Solutions for IRS Tax Issues

The IRS demanded my client pay $450 a month on her $25,391 tax debt. She was terrified. She couldn't afford it. But when I discovered what the IRS was hiding in their calculations, everything changed: The IRS was operating under the assumption that my client was living with her boyfriend. Although he wasn't liable for the tax, he made $90k a year, which, according to the IRS, meant he had money available to cover my client's expenses. She did live in his home, so on the surface, their logic seemed sound. But here's what they missed - she wasn't just living there. She was renting the top floor under a formal lease agreement. She was a tenant in his house and she paid rent like any other tenant would. Recognizing that detail changed the entire trajectory of the case. I argued that her boyfriend's income was irrelevant to her financial situation. Her expenses were based on a rental agreement that she was legally obligated to pay in full. We had the lease to prove it. The IRS couldn't dispute that. Instead of the $450 monthly payment they demanded, I negotiated a $100 partial pay installment agreement. Over time, the statute of limitations ran out on the remaining balance. My client ended up paying $5,200 of the $25,391 that was owed. This case reinforced something I wrote about last week - you don't have to take no for an answer when dealing with the IRS. When you understand the rules they're playing by, options open up that other people can’t see. Most taxpayers would have accepted that $450 payment plan, struggled financially for years, and paid the full amount owed. But knowing how to challenge the IRS's assumptions, provide a coherent argument based on the Internal Revenue Manual, and present the right documentation made a $20,000 difference in my client's life. That's the power of understanding administrative tax law. You know when and how to push back.

Owe Back Taxes? Here’s How to Handle It Like a Pro! Let’s be honest—falling behind on taxes can feel overwhelming. But if you’re a small business owner dealing with back taxes, don’t panic! The IRS wants to collect, not punish, and you have options to get back on track. Step 1: Assess the Damage First, figure out exactly how much you owe by checking your IRS account online or calling the IRS. Don’t forget penalties and interest—they add up fast! Step 2: Don’t Ignore IRS Notices If you've received a letter from the IRS, read it carefully and respond by the deadline. Ignoring notices can lead to liens, levies, or even wage garnishments. Step 3: Explore Your Payment Options The IRS offers several ways to resolve back taxes: ✅ Short-Term Payment Plan – If you can pay within 180 days, this is your best bet. ✅ Long-Term Installment Agreement – If you owe under $50K, you may qualify for monthly payments. ✅ Offer in Compromise (OIC) – If paying the full amount would cause serious financial hardship, you may be able to settle for less. ✅ Penalty Abatement – If you have a good reason (illness, natural disaster, etc.), you might get penalties reduced. Step 4: Keep Future Taxes in Check 📌 Make estimated tax payments – If you’re self-employed, set aside funds quarterly. 📌 Automate tax savings – Open a separate account for taxes to avoid surprises. 📌 Work with a tax pro – A good CPA or tax attorney can help you avoid IRS trouble in the future. Owing back taxes is stressful, but taking action now can prevent bigger problems later. If you’re feeling stuck, reach out to a tax professional—you have more options than you think! #SmallBusiness #Taxes #IRS #TaxRelief #EntrepreneurTips

Once Form 1099-DAs start to hit people's mailbox early next year, pretty much all the crypto investors will be on IRS' radar. If you have been heavily involved in crypto but never reported your crypto taxes, the clock is ticking. You can either wait for the time bomb to explode, or you can take action now to minimize the damage. The IRS has expanded its Voluntary Disclosure Program (VDP) to include unreported crypto activities, but late-2024 updates to Form 14457 show a tougher stance. If you’ve fallen behind on reporting crypto taxes, this may be your last best chance to come forward before enforcement ramps up. 🔍 What’s Changed in Form 14457? - Willfulness admission now required - Expanded narrative detailing people, platforms, and transaction types - Full payment expected unless financial hardship is documented - Documents must be ready at the start—returns, records, narratives - Only 45 days to submit full disclosure after preliminary approval (1 extension allowed; a second removes you from the program) - Preclearance decisions can be issued within days, meaning your materials should be ready before applying. 🕰️ Why Consider the VDP? If you didn’t report your crypto transactions from previous years, e.g., trading, staking, DeFi, etc., VDP offers a rare chance to: - Avoid criminal charges - Resolve multiple years at once - Limit exposure to fraud penalties (up to 75%) - Stay ahead of increasing IRS scrutiny (think Form 1099-DA and blockchain tracing tools) Waiting until the IRS contacts you closes the door on VDP eligibility. 🧑💼 How We Can Help At Chainwise CPA, a tradename of Polygon Advisory Group, LLC, our licensed CPAs and EAs specialize in crypto tax compliance and planning. We’ve helped clients: - Reconstruct crypto transaction history - Fix cost basis errors - Prepare accurate amended returns ready for VDP filing We also provide IRS representation service and can assist you with VDP filing. For serious or high-risk cases involving potential criminal exposure, we can refer you to experienced tax attorneys in our network who regularly handle VDP submissions and negotiations with IRS Criminal Investigation. 📬 If you need help cleaning up previous years and preparing for VDP submission or amended tax return filing, reach out. Getting ahead of this now is far better than waiting for a letter from the IRS. Act before it's too late! #CryptoTax #IRSVDP #TaxCompliance #CryptoCPA #CryptoInvestors #Form14457 #CryptoReconciliation

You've got a tax bill that's making your eyes water, but you can’t settle it due to your current financial situation. You're stuck between a rock and a hard place – or more accurately, between the IRS and your basic living expenses.  What do you do? The Currently Not Collectible (CNC) status could be the financial breathing room you've been gasping for. The CNC status lets you hit the pause button on your tax debt.  If the IRS agrees that paying your taxes would leave you unable to cover your basic living expenses, they might put your account in CNC status. But it isn't a "get out of jail free" card.  Your tax debt doesn't vanish into thin air. It's more like the IRS saying, "Okay, we'll stop knocking on your door for now."  They won't come after you for collection while you're in this status. But (there's always a but, right?), here's the thing: Interest and penalties will keep piling up.  It's the law.  Which means while you're catching your breath, that debt will continue growing. So, what's the takeaway here?  If you owe IRS taxes but can’t pay due to your financial situation, CNC status could be your life raft.  It's not a permanent solution, but it can give you the breathing room you need to get back on your feet. But always keep this in mind: tax troubles are like quicksand – the more you struggle alone, the deeper you sink.  Don't be afraid to reach out for help.  Whether it's CNC status or another solution, there are ways to work with the IRS and keep your head above water.  Rooting for you.