“Does hiring a Tax Attorney stop the IRS from bothering me?”

Not immediately.  Although you have partnered with us and we have submitted your Power of Attorney to the IRS, you will remain in “Collection Status” with the IRS.  While you are in Collection Status, the IRS will continue to send you letters/notices and may even levy you.

Your Tax Attorney can obtain a one-time short term Collection Hold* (30-60 days) during which time the IRS will temporarily stop its collection activity (i.e. – levy).  However, during this Collection Hold period, you must provide us with the information that we requested from you and submit all supporting documents within the agreed-upon deadline.  The Collection Hold will lapse if we do not receive this information.

Once your Offer in Compromise has been filed, you will be removed from “Collection Status.”  When this has occurred, the IRS will not act to collect the tax liability (i) while it is investigating and evaluating your offer, (ii) for 30 days after it rejects an offer, and (ii) while you appeal an offer rejection.

Please call your Tax Attorney to discuss the details of a Collection Hold.

“I just received an Intent to Levy.  What do I do next?”

The Intent to Levy (or Final Notice of Intent to Levy) means that you may be levied within 30 to 60 days.  At this time, you have three options:

Your first option is the short term Collection Hold (see above).

Your second option is an Installment Agreement.  The Installment Agreement will remove you from “Collection Status” for as long as you continue to make the monthly payments to the IRS.  As the name implies, this is a short term solution designed to give you some breathing space while we get your resolution petition together.  You should elect this option if you feel you cannot get the information/documents together within approximately 45 days.  The Installment Agreement payment will be based on your financial situation. Therefore, you will need to complete the “Levy and Wage Garnishment Questionnaire” and return it to our office along with your most recent pay stub.  Unfortunately, the Installment Agreement payments cannot be applied toward your Offer in Compromise amount.

Your third option is to wait and see if your will be levied while immediately providing information and documents to us.  The Intent to Levy is not a guarantee that you will be levied.  Many people do not want to commit to a monthly payment to the IRS, and prefer to wait until they receive a Notice of Levy from the IRS.  Once you receive this notice, our office will work to have the levy released as soon as possible.  In order to release the levy your Tax Attorney will need: (1) Power of Attorney, (2) Levy and Wage Garnishment Questionnaire, (3) Notice of Levy, (4) most recent Pay Stub (5) Contact Information for your Payroll or Bank Representative.  Furthermore, you MUST be in tax return compliance with the IRS.  If you elect this option, please make sure that you have all of this information immediately available.

What does “Tax Compliance” mean?

Generally, “compliance” means that you have done everything that the IRS requires of you (other than pay your taxes).  If you fail to meet the IRS “compliance” requirements, your Tax Resolution options are very limited.  The rationale behind “compliance” is that if you wish the IRS to grant you some sort of relief (e.g. – release of levy, settlement), you must meet your basic tax obligations.  Compliance most commonly requires that you FILE ALL TAX RETURNS; “compliance” also requires that you pay quarterly Estimated Tax Payment, or make Federal Tax Deposits (when necessary).  Your Tax Attorney independently verifies your “compliance” status (most tax resolution companies stacked with sales agents or other unqualified “tax consultants” do not).  Please discuss with your Tax Attorney if you feel you have not met your “compliance” requirements.

“I just received IRS letters stating that I have to pay them an Installment Payment.  What happened to my settlement?”

This means that your Tax Attorney set you up on an Installment Agreement as a means to stop (or prevent) a garnishment or levy against you.  This acts as a very limited trade-off to release your income/funds from the levy.  The Installment Agreement is a short-term resolution strategy, and your Tax Attorney is still working hard toward your Offer in Compromise or Penalty Abatement Petition.  Please help us by completing all documents that we have sent you and returning to our office as soon as possible.

“Since hiring the Firm, I continue to receive statements from the IRS.  What do they mean and why do I still get them?”

The IRS must continue to inform you of your tax liability and the penalties and interest that have accrued as this is part of satisfying due process.  Please keep these documents for your records.  Although your Tax Attorney has a current Power of Attorney on file for you with the IRS, you will continue to receive documents from the IRS.  In fact, we have specifically requested that the IRS continue to send you these statement and notices for your records.  Receiving these notices are both normal and positive.

“Why do I have to fill out all of this paperwork?”

Your Tax Attorney relies very heavily on information that you provide to us.  Your chances for relief are directly related to the quality of the information that you give to us.  The more information and arguments that you give to us, the better chance we have against the IRS.  If you are serious about solving your tax problems, please take the time and effort to review and complete our questionnaires and other documents.  Also, supporting documents that you provide to us will be very helpful to you since this is the “evidence” that we use to bolster your case.  If you need help with this process, please contact your Tax Attorney.

“What happens if I cannot pay my Installment Agreement?”

If you cannot pay your Installment Agreement and stop paying the IRS, then you will be placed back into “Collection Status.”  While you are in Collection Status, the IRS resume sending you letters/notices and may even levy you.

If paying the Installment Agreement presents an economic hardship (you are unable to pay necessary bills), then please complete the “Levy and Wage Garnishment Questionnaire” and submit to our office along with a current pay stub.  We will review your financials to see if we can negotiate a lower Installment Agreement amount (or even place you in Uncollectible Status).

Your Tax Attorney does not advise you to stop making payments to the IRS at any time; the default may create more hardship in the long term by placing your account back into “Collection Status.”

“My employer just gave me a Notice of Levy on my paycheck.  What do I do now?”

First, immediately gather all of the documents that we need to release your levy: (1) Power of Attorney, (2) Levy and Wage Garnishment Questionnaire, (3) Notice of Levy, (4) most recent Pay Stub (5) Contact Information for your Payroll Representative.  Second, take all steps to make sure that you meet all “compliance requirements” (see above).  Third, complete all paperwork given to you by your employer.

You should advise your employer that you are working to solve the problem and see if he/she will help you in any way.  Our ability to react quickly to release the levy completely relies on your ability to provide the requested information and meet the compliance requirements.

If you have a Revenue Officer assigned to your case, you must complete the Personal Financial Information Questionnaire and submit to our office as soon as possible.  Please contact your Client Services representative to request any forms or clarification of this process.

“All of the funds in my bank account are frozen.  What is going on?”

The IRS has most likely “levied” the funds in your bank account.  A Bank Levy is a one-time seizure of funds.  If there is no money in the bank account at the time the levy is placed, you do not have to worry.  Please contact your bank to check if there is any money in the account.  Only the funds that are in the account at the time the levy is placed are affected by the levy.

If there is money in the account, it will be held by the bank for 21 days.  At the end of 21 days, the funds are turned over to the IRS.  If the 21 days have not yet expired, immediately gather all of the documents that we need to release your levy: (1) Power of Attorney, (2) Levy and Wage Garnishment Questionnaire, (3) Notice of Levy, (4) most recent Pay Stub (5) Contact Information for your Bank Representative.  Second, take all steps to make sure that you meet all “compliance requirements” (see above).

“I just received a document request letter for my Offer in Compromise.  I thought I already sent this information to you?”

Although you may have previously provided documents to the IRS, they continue to request UPDATES to the information that you had provided.  This is normal procedure and signifies that the IRS is seriously considering your Offer.  Do not be alarmed or annoyed.  Please comply with all requests by the IRS, as this will greatly speed the progress of your case.  Please contact our Client Services department with any questions.

“My Offer in Compromise has been rejected.  What happens next?”

If the IRS has “rejected” your offer, you may have received one of two documents from the IRS: (1) a Preliminary Analysis, or (2) a Rejection of your Offer.  Neither signifies the end of the road.  The IRS is likely claiming that you have the ability to pay your tax liability in full. Your Tax Attorney will review their analysis and respond to this claim.  If we need any additional information from you, we will contact you.

If you have received a Preliminary Analysis, please fax the into our office as soon as possible.  Make sure to include the “Income/Expense table (IET)” and the “Asset/Equity Table (AET).”  Your Tax Attorney will comb through these documents to contest the IRS preliminary findings.

If you have received a rejection of your offer, please do not worry.  Your Tax Attorney will exercise your rights to appeal and will ensure that your case remains open.  Please fax our office the letter that you received.  Your Tax Attorney will review the rejected and appeal by the deadline, if there is any information that we will need from you, we will let you know.

If your Offer in Compromise has been rejected, Your Tax Attorney will submit a Notice of Appeal, which will transfer your case into the Appeals Department of the Offer in Compromise office.  An Appeals officer will be assigned to your case, and will review the case from the beginning.  Please understand that many cases are rejected and sent to the Appeals Department.  This is because the Offer in Compromise Department does not have the capability of accepting expenses beyond the amounts that the IRS has designated.  The appeals officer has the ability to accept more expenses based on your personal situation.  Therefore, it is imperative that we can verify all of your expenses to give your Offer the highest chance of being accepted.

“There was an IRS Agent/Officer at my door and they keep calling me.  What should I do?”

Please get the name and contact information for this Revenue Officer and let them know you have retained a U.S. Tax Court Attorney to represent you.  Then ask them to contact your Tax Attorney.  The IRS Revenue Officer should not come to you if you have a Power of Attorney on file with the IRS.  Once your Your Tax Attorney is able to discuss the case with this IRS Officer, we will let you know the necessary steps that need to be taken.

“I keep receiving notices from my state.  Aren’t you handling that?”

Unfortunately, unless the Firm’s Tax Attorney has a special Power of Attorney filed with your State’s Taxing Authority and the state tax representation was part of the scope of services as defined in the Engagement Agreement, we cannot represent you with respect to your home state’s tax liabilities.  Please consult with your Tax Attorney.

“Do I have to pay the IRS while I am working with your Firm?”

Yes!  The IRS requires you to pay all taxes that are due and file all tax returns when they are due.  If you are required to pay Estimated Tax Payments or Federal Tax Deposits, hiring any Federally Authorized Tax Practitioner does not allow you to stop making these payments.  We are helping you take care of your tax problems from the past.  Please do not make new problems while you are working with us.

“A tax lien shows on my credit report.  What is going on with that?”

The IRS files Federal Tax Liens on almost everyone who hasn’t paid their taxes once they have been assessed.  The lien attaches to everything tangible (such as your house), will show on your credit report and operates to secure the Government’s interests in all of your property and assets.  The lien is meant to announce to the world that you owe the IRS and transforms your IRS tax liabilities into secured debts.  This Federal Tax Lien will automatically be removed if you (1) pay the liability in full, or (2) have your Offer in Compromise accepted and pay that amount in full.  Therefore, please complete your applicable Questionnaire and return to our office as soon as possible.  This information will be imperative for us to complete your Offer in Compromise.

“Can you remove the Federal Tax Lien from my house?”

If you are currently selling your home and have found that there is a lien filed against the property, this will not prevent you from selling the home and you will not need to remove the lien from the house.  However, any proceeds (money) from the sale will be paid to the IRS until the lien is paid in full – and then the lien will be removed.  We recommend that your complete your Guide for Taxpayer Questionnaire and return it to our office as soon as possible.  If your Offer in Compromise is submitted, accepted and paid, then the lien will be automatically removed.

If you are refinancing your home, your Tax Attorney can subordinate the lien which will allow for the new lender to be the #1 lien holder and in most cases the bank will continue with the refinancing.  For more information on Lien Subordination, please contact your Tax Attorney.