So an IRS payment plan and negotiating one is both an art and a science. Let’s talk about the science side of things. So IRS payment plans start based on a formula and the formula looks at the available assets that a taxpayer has and the IRS determines whether the taxpayer could full pay or substantially pay the liability based on the value of those assets. So for example if you owe the government $50,000 and you have $50,000 sitting in your bank account, the IRS is going to want that absent some good reason. So they go through your expenses, they look at your house, in certain cases they look at the equity in your house, can you borrow against any assets, things like that. If they determine that you don’t have sufficient equity in your assets, then it becomes an income and expense analysis they look at your various sources of income they usually average it over a three-month period and then they’ll look at your ordinary and necessary living expenses. So the real kicker with this is the term ordinary and necessary. The IRS has standards and they’re based on both national standards and local living standards on how much things should cost. So like for example, with your housing the IRS has an average based on where you live of how much housing is in your area. If you go to.
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If I Owe Money to the IRS How Do They Look at Credit Cards?
The IRS considers necessary they won’t write in minimum credit card payments and will require you to pay a monthly installment.
I Owe Money to the IRS, How Will the IRS Look at Educational Expenses?
The IRS considers those children to be adults.
If I Owe Money to the IRS Are They Going to Take My House?
The IRS is playbook so generally speaking if you’re proactive in resolving your tax liability your house is generally safe.
Can Tax Debt Get Discharged in Bankruptcy?
This video will provide you information on the discharge of tax debt during bankruptcy.
Will the IRS Waive Interest and Penalties?
The liability so with interest interest on tax liabilities.
Will the IRS Take My Car?
The IRS we had a long history of doing really nasty things to people in the early to mid nineties.
What Actions Will the IRS Take Against Me If I Owe a Liability?
The government so what happens as time passes is the IRS we take an increasingly serious action against.
What’s the Strategy for Dealing With IRS Collection Cases?
The IRS completely out the window and just start with the client so we take a client situation and every situation.
What Is an IRS Audit?
So IRS audits have a lot of bad connotations that surround them but on a very basic level an IRS audit is the IRS coming in and checking that your tax return was filed correctly. What the IRS is looking for in an IRS audit is they’re looking for one of two things. Number one they’re looking for any income that wasn’t reported or income that wasn’t reported correctly and number two any expenses and/or credits that were not being accounted for properly or not taken appropriately. The combination of income and expenses contributes to your taxable income and the amount of tax you pay so essentially what the IRS is doing is they’re coming in and just verifying that the information is correct. Now what I tell my clients is that tax returns tell a story. So for example you were sitting, you’re watching this video and you have a tax return and that tax return contains a treasure trove of information about you. It tells whether or not you’re married, it tells whether or not you have kids, it says where you live, it says where you earn income from and it says to some limited degree