How Can You Help Me with My IRS Problem?

by Tom Buck

comic-text-help-me-retro-banner_7JrtMf_L(1)We are fortunate to have had a large number of people for whom we have arranged successful outcomes. These happy folks and other professionals refer taxpayers with IRS problems on a regular basis. When we are contacted by a new prospective client this is how it normally progresses.

Because I have been an advocate for people with IRS problems for over thirty years, I have become quite adept at determining the range of possible outcomes. In order for me to determine if we can help, we always offer an initial FREE consultation.

The time we spend on this initial consultation varies, but it is not unusual for me to spend in excess of thirty minutes, and sometimes considerably longer. The primary purpose is to learn exactly what the issue(s) might be. After having done this work for so many years, I am usually able to determine two things: 1) whether this is a problem I can help resolve, and 2) what will be involved if I can help.

The most common issues we deal with are either IRS audits or IRS collection problems. If the IRS has informed the taxpayer that they are auditing a particular year or years, we first determine what the major issues are. Then we discuss what nature of documents the taxpayer has to support the items in question.

If the taxpayer has good records AND the tax return was properly prepared in the first place, the result of the audit can very possibly be a “no change”. This is the ideal outcome because it means there will be no additional tax due as a result of the audit.

If the IRS problem is a matter of collections, this means that the IRS has already perfected it claim against the taxpayer. In this case the taxpayer most likely does owe the amount the IRS is trying to collect. There are numerous causes for the IRS to have the right to collect a balance due.

The more common causes are: 1) the taxpayer filed a tax return showing a balance due, but did not pay the balance due in full, 2) the IRS has audited a tax return(s) and determined that additional tax is due (in this case the assumption is that the taxpayer has exhausted any means of reducing the audit balance results), 3) if the taxpayer did not file an original tax return, the IRS will file a return, known as an SFR (Substitute for Return) based on information it has on its computers (this almost always results in a much higher tax due that would have been the case if the taxpayer filed), 4) there are penalties for late filing of tax returns or late payment of taxes due. Check out next week’s post for in depth information on IRS penalties.

To be sure there can be other reasons for the IRS to be taking aggressive collection action, but these are the main ones. By the way, if the IRS has filed an SFR, it is almost always possible to file an actual return using all appropriate deductions and exemptions. In the vast majority of cases, this results in a dramatic reduction in the amount the IRS claims to be due.

In these collection cases, there are occasional situations in which we can reduce or completely eliminate the amount due. However, in most cases, there will remain some amount of tax due. In these situations we will help the taxpayer arrange a negotiated payment schedule. Please see previous postings regarding Offer-In-Compromise and installment payment plans.

The main thing I would like to stress is this: during our initial consultation, I will be able to determine what the outcome of our representation should be. Assuming we can help ( meaning we expect to save more in taxes than it costs for us to provide the necessary services) we will explain what the result of our work should be. This is based on working hundreds of IRS problem cases.

If the taxpayer decides to engage our help, we will bring to bear all of our considerable experience and knowledge of how the IRS works. More often than not, it will be necessary to convince the IRS that we are right and that their position is wrong. We spend considerable time these days in educating IRS agents what the law means and why our position is correct. It also helps to have the tenacity of a bull dog. In other words, once we know what the outcome should be, we don’t stop until we have achieved the desired result.

While Buck, CPA, llc still does tax preparation for clients, I have much more satisfaction (and fun) fighting for the rights of our clients in these adversarial audit and collection situations. Our motto pretty much says it all: We defend our fellow citizens against their government by making sure the IRS obeys the rules.