This
guide contains:
Background on tax relief agencies
Features and qualities to look for in tax relief agencies
How
to find the best tax relief agency for you
This
short guide was created to help you understand the basics
of tax relief agencies, and to help you choose the right
tax relief agency for you. We do not offer any tax relief
services ourselves, so you can be assured that all of
the information in this guide is independent and unbiased.
Background
on tax relief agencies
If you or your business is experiencing trouble with
the IRS or any state or local taxing authority, you
should take comfort to know that there are firms across
the country that specialize in helping individuals and
businesses work through their tax issues and problems.
Features
and qualities to look for in tax relief agencies
Here are some of the common services offered by such
tax relief firms:
Offer
in Compromise (OIC)
An 'Offer in Compromise' is an agreement between a taxpayer
and the IRS that resolves the taxpayer's tax liability,
almost always for less than the full amount that is
owed. By allowing consumers to 'settle' their tax debt
for less than the total amount owed when meeting certain
guidelines, the OIC program has helped the IRS increase
overall tax revenue (under the theory that something
is better than nothing) and reduce collection costs.
A tax debt can be legally compromised when meeting one
of the three guidelines:
-there
is a doubt as to whether the assessed tax amount is
correct or not,
-there
is a doubt as to whether the taxpayer could ever pay
the full amount of tax owed, or
-the
taxpayer demonstrates that there are exceptional circumstances
that payment of the assessed amount would create an
economic hardship or would otherwise be unfair and inequitable.
Penalty
Abatement
Penalty abatement is a process where the taxpayer can
challenge and negotiate any penalties and interest (not
the principal, however) that have accrued under certain
circumstances:
-reasonable
cause- innocent mistakes, ignorance of the law,
death, serious illness, unavoidable absence, and so
on.
