MEMORANDUM TO SMALL BUSINESS OWNERS WITH IRS PROBLEMS

From:  Van Lanier, Senior Partner

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There is no question that dealing with the IRS can be intimidating.  It can also be dangerous, especially for small business owners who are laser-focused on earning a living and often put taxes on the back burner.  

It has been my experience that when a self-employed person has an IRS problem, it is usually one of the following:    

PAYROLL TAXES - If you have unfiled and/or unpaid payroll taxes, you want to fix that immediately.  Left unchallenged, the IRS can assess the Trust Fund Recovery Penalty against you as the “responsible person,” and that tax debt cannot be discharged in bankruptcy.  There are ways to avoid this, but they require experienced analysis and quick action to block adverse IRS action while a solution is developed.  Payroll liabilities are the number one problem for self-employed people.  Hoping to catch up next quarter is not the solution.

UNFILED TAX RETURNS – For many self-employed people the last thing on their mind is filing a tax return.  Once the first year is missed, they fear that filing the next year will alert the IRS to the missing return, so they don’t file . . . then the next year is ignored, and so on.  After several years, the IRS finally starts sending letters along with penalites and interest.  By then, the taxpayer’s business and personal financial records are often in disarray or missing.  What to do?

IRS Policy Statement P-5-133 allows a delinquent taxpayer to become current by filing only the last Six (6) years of missing tax returns.  If records are unavailable, tax returns can be prepared using IRS data from your master file, reasonable estimates, the Cohan Rule, and IRS ratios.  It is vital to prepare and file missing returns, before the IRS alledges "willful failure to file," which is a federal offense, not just a nuisance.     

BACK TAXES OWED - You know that ignoring those IRS Collection Notices is not a good idea.  Sooner or later the IRS will file a Federal Tax Lien against you and begin enforced collection (levy and seizure). The law provides alternatives to IRS enforced collection.  These include several types of Installment Agreements; placing your account in Current Not Collectible status; potential bankruptcy discharge; and in rare cases an Offer in Compromise settlement. 

However, before chasing one of those "pennies on the dollar" radio ads, you should know the facts:  Last year IRS closed 6,105,145 delinquent accounts.  Of the 33,591 Offers in Compromise submitted, only 7,199 were accepted by IRS.  That's about 1/10th of 1 percent of delinquent accounts closed by an Offer in Compromise.  See here:  OICMills.com 

IF YOU NEED HELP, CALL ME.  Every taxpayer has a unique set of circumstances.   When you call me, I will listen to your story and answer all your questions.  I will explain the tax resolution process and what you can expect.  At the end of the call, you will be equipped to make an informed decision.  You can reach me directly at 703-437-4140, ext. 1.  If you prefer, we can meet via Zoom or in my Herndon office.  If the IRS has become a problem, I have the know-how and 45 years of experience to help you resolve it.   

Don't ignore the IRS, whatever you do.  The IRS is one federal agency that will not go away, just because you ignore it.  The IRS is not your friend and it has unprecedented power to collect taxes and make your life miserable if it has to.  There is no need to put yourself at risk when reasonable solutions are available.  If you are ready to put the IRS behind you, call me.  I will help you do it.  

You can learn what to expect if you hire us HERE.

"After wasting $5,000 with an out-of-town debt relief company that failed to solve my tax problem, I found Van Lanier at NOVA Accounting in Herndon.  He immediately stepped in, protected me from an IRS levy, and negotiated a settlement I could afford.  His calm demeanor and negotiating skills saved the day!”

                          --- Kate P., Ashburn, VA