Wednesday, July 30, 2008


If it's free it's for me! In a world where the cost of everything continues to go up I am all over anything I can get free. More and more service based companies are cutting back on the things they use to offer as incentive to do business with them. The tax industry is riding that wave also. There is good news though. If you call the right tax firm they have the ability to get information for you when you're not sure what’s going on. The fee for this service can range from 650- 900 dollars. A lazy tax consultant will just guess as to your actual liability amount and you get charged for what he "guesses" you owe. Many companies base their fees on what you owe so they guess high and hope you don't object. This service is called a practitioner call. They can provide you any information they need to handle your case. This is especially important if you have any tax returns from previous years. These older returns are very suspect to the IRS, therefore each one of these returns will be hand audited. A good tax company will use the information they get from the IRS to file your returns. Why? To get you through step one of the audit process. The first thing an auditor looks for is accuracy of the numbers. Down to the penny! This is just one benefit of the practitioner call. For more info on this potentially free service, call around and see who will offer it.


The economy is hurting and we all know it. The IRS knows it too. We have been receiving more and more calls about folks getting 1099-C's turned in on them. This takes most people by surprise. They thought that they were done with the whole ordeal, and then they get a notice saying they owe the IRS money. Most of the time it gets blown off as a mistake by the IRS. It is no mistake! On December 20, 2007, the Mortgage Forgiveness Debt Relief Act was put into effect. Usually when you have a cancellation of debt by a lender, it has to be included as income on your taxes. This act now allows tax relief from a portion of that forgiven debt. The act only applies to your primary residence and only to forgiveness or cancellation on money used to buy, build or substantially improve your primary residence. You can also apply the act to refinancing debt incurred up to the amount of the principal balance of the old mortgage right before the refinance. There are a lot of details that can't be covered in a short post. For more info consult with a PROFESSIONAL.


The Nike philosophy is a universal truth that can save you money! As a senior tax consultant in a major tax resolution firm, I see cases all the time that could have been half the price for resolution. Every 4 years you don't handle a tax liability, it DOUBLES! I understand when folks tell me that they got scared. Fear and procrastination will cost them much more than they think. The common symptom most people have with tax problems is analysis paralysis. Action is what ignites every success. Action is what produces results. Knowledge is only potential power until it comes to someone who knows how to get himself to take effective action. If you want to reduce the amount you have to pay the IRS, then do your home work on some PROFESSIONAL TAX RESOLUTION FIRMS and JUST DO IT!

Tuesday, July 29, 2008


Have you ever greeted someone with a hug or kiss and you could feel them knifing you in the back? If you have been around for more than a week I'm sure you have run into people who are nice to your face but really don't care a thing about you.
Unfortunately, the IRS has figured out that they can get much more information from tax payers by acting like they are there to help you. They will be down to earth and friendly. BEWARE… they have an agenda. They want you to tell them important information they need to do their job, COLLECTING YOUR MONEY! They need banking info, job info, anything they can use to ENFORCE COLLECTIONS! The IRS is a SUPER COLLECTIONS AGENCY. All their employees are trained to lull you into a false sense of security that they're going to HELP YOU. Make no mistake, they are there for one purpose and that is to collect. In 2007, over 4 million LEVIES and LIENS were issued. To do that, they need SOURCES (ie. banks, job etc.) A lot of times they get you to volunteer to write it all down and send them all the info they need to ENFORCE COLLECTIONS on you via a form called a 433 a, b or f. If you fill this out and send it to them, THEY HAVE YOU! Don't be unaware of their tactics. Get a PROFESSIONAL ORGANIZATION to help you.

Thursday, July 24, 2008

Do you have a tax lien?

Tax liens can be filed by the IRS 10 days after a balance due notice or demand for payment has been sent to the tax payer. Lien's are a public notice to the tax payer's creditors that the goverment has claim against the tax payer's property.

The IRS will only release a notice of federal tax lien within 30 days of the tax payer paying their liability in full or if an offer in compromise is accepted and the terms of the agreement fulfilled.

Liens are filled in the courthouse of the county of residence of the taxpayer. Most people believe that the IRS reports this to the credit bureaus. This is not the case. The federal tax lien is public notice and the credit bureaus pick it up there. Having a lien on your creidt reort will damage your credit score.

If you questions about tax liens or other tax problems contact Effectur.

Taking Care of Your IRS Problem

When you owe the IRS, or are behind in filing your tax returns; there are three things you can do.

The first is to do nothing and let the IRS enforce collections and take care of your problem for you. This is never a good idea. Although the IRS can prepare and file a return for you, known as a substitute for return or SFR, they will prepare it in the best interest of the treasury. Meaning, they will not take into account any deductions you may be able to take advantage of, and then they will assess a tax liability against you. This will put you into the collections process; mandating that you take action or have the full collection forces of the IRS come after you.

The second thing you can do is handle it yourself. This is also not a good idea. Unless you know how the IRS works and what options are available for you, you will never know if you have gotten the best deal that is available for you. It is not the IRS’s job to get you into your best possible result, it is their job to collect from you. AND it is never a good idea to prepare your own tax return. Always have a professional do it for you so that you can be sure to take advantage of all possible deductions you may have and to avoid costly mistakes and errors that can cause you many many headaches.

The Third and best way to handle your situation is to hire a reputable tax resolution firm. They will know how the IRS works, what options are available to you and get you the best result possible. You wouldn't go to court without a lawyer would you? So why would you want to face the largest bill collector on your own. A reputable firm will have your best interest in mind. Have great communication with clients, have great customer satisfaction scores and deliver what they promise.

You always want to be proactive with the IRS and deal with them on your own terms.

Coming soon: How to know your tax resolution firm is reputable.

Levy notice from the IRS and what it means to you.

Like so many tax payers, this could happen to you. You get a certified letter form the IRS. When you pick it up from the post office and open it, you read that the IRS intends on levying certain assets.

Don't panic!

This means that you have not responded to the IRS's other letters they have been sending you. The IRS can not levy you until you have been through the collection due process. Simply put, they have to notify you of a balance due and give you time to respond.
If you get a CP 504, intent to levy, there is still time to handle your problem.
You do need to get moving right away, because doing nothing will only result in the IRS taking your assets away.

If you are unsure of what steps to take next, it might be time to hire a reputable tax resolution firm. A tax resolution firm can help you out tremendously; they know how to deal with the IRS and can get you back onto the road to recovery and peace of mind.

Tuesday, July 15, 2008

The Collections Process and the IRS

The IRS is required by law to follow specific steps when notifying a tax payer of a tax liability. This is the Collections Due Process. The IRS has to follow these rules step for step. They only need to send notices to the last know address of the tax payer.

The process starts with a balance due notice, form CP14 or CP11. The balance due notice states how much is due and from which tax year.

After 10 days of sending the Balance Due Notice the IRS will send a second notice of demand for payment with form CP 501.

10 days after the CP501, a CP503 is sent with the same demand for payment.

When all the above notices are ignored, the IRS will send a CP504, Notice of Intent to Levy. This is always sent via certified mail.

In most cases a final notice of intent to levy is sent. This is letter L 1058. This step may be skipped by the IRS.

If the taxpayer ignores or fails to respond to all the notices, a Levy is placed against the taxpayer and a notice is then sent to the taxpayer informing them of the levy. The Levy Notice is form 668.

If you are in IRS collections, you may need help to handle the IRS. You want to act quickly when you start receiving these notices and not wait until you are levied which can leave you with no money that may be used to get help. It is always best to be proactive with the IRS. You want to deal with the IRS on your terms not theirs.

Monday, July 7, 2008

Never Say Never

The very first thing you have to know is there many blogs on the net that tell you they know how the IRS works.They will tell you the IRS works one way and if you have a problem the IRS will do this every time because after all they are a methodical organization.The problem with that is they are living in a test tube world .They base all there outcomes on generic circumstances and the letter of the law.They are the same people who believe one day computers will replace you at your job.After all computers are capable of doing anything we can right?
To dispel this myth I will only be using real actual cases to show you there is another realm of possibilities that are availble to the common tax payor who has
representation for there IRS issues.