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Types Of IRS Pain


  1. IRS LIENS (You Lose Your Credit)
    Federal Tax Liens will make your life miserable. Federal Tax Liens are public records that indicate you owe the IRS. They are filed in the county where you live or have your business. They go on your credit report, making it difficult to finance a car or a home. You cannot transfer a clear title to your house.
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  2. IRS LEVY (You Lose your Money)
    A levy means you just lost your money from your bank account or your paycheck or your account receivable. An IRS levy is the act of seizure of your money by the IRS from someone else. The person, company or bank on whom the IRS serves the levy must comply or face their own IRS problems.

    An IRS bank levy is only for the particular day the levy is received by the bank. The bank is required to remove whatever is in your account that day (up to the amount of the IRS levy) and send it to the IRS in 21 days unless notified otherwise by the IRS. This type of levy does not affect any future deposits made into your bank account unless the IRS issues another Bank Account Levy.

    An IRS Wage Levy keeps going from paycheck to paycheck. It is filed with your employer and remains in effect until the IRS notifies your employer that the wage levy has been released. Most wage levies will take so much money from your paycheck that you won't have enough money to live on. The additional paperwork will irritate your boss.
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  3. WAGE GARNISHMENT (You're working for the IRS now)
    The IRS wage garnishment is filed with your employer. Your boss is required to collect a large percentage of each of your paychecks and pay it to the IRS until it is fully paid or the IRS agrees to release the garnishment. Your payday is now a payday for the IRS.
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  4. IRS PENALTIES (You Get Punished)
    The IRS penalizes millions of taxpayers each year. They have so many penalties that it's hard to understand which penalty you've received.

    When you do not file and do not pay your tax liability it increases by 50% in a short period of time. To make matters worse, the IRS charges you interest on penalties. IRS interest is compounded daily and you have to pay income tax on any penalty you do pay the IRS. You might find out about the IRS problems years after they have occurred, when they are full grown monsters.

    Some IRS penalties can be as high as 75%-100% of the original taxes owed. Even if you could pay the taxes owed, the extra penalties make it impossible to pay off the entire balance.

    The IRS imposes penalties to punish taxpayers and keep them in line. The IRS does forgive penalties. Before you pay the IRS any penalty amounts, you may want to consider requesting the IRS to not punish you because it wasn't your fault.
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  5. AUDITS(Finders, Keepers; Losers, Weepers)
    The IRS can audit you by mail, at their offices or at your place. A "mail" audit may be just for missing documents. An "at their office" audit will be more documents plus demands for explanations. The IRS is looking for unreported income or improper deductions. An "at your place" audit will be done by highly trained Revenue Agents and often gets expanded to other tax years and many more problems. While at your place, a "lifestyle audit" also occurs. Audits are serious business. Always get professional help.
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  6. PAYROLL TAX (You Lose Your Business)
    The IRS wants past due payroll taxes paid. The penalties assessed on delinquent payroll tax deposits/filings will choke a horse. How you handle the IRS agent will determine whether you stay in business or are liquidated by the IRS. The continued non-payment of employees' withheld income tax is a crime. Do not meet with any IRS representatives about payroll taxes until you have met with a professional to discuss your options.
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  7. IRS SEIZURES (You Lose Your Property)
    A seizure means you just lost your property like your business equipment or inventory or your land or your boat or your house. The IRS has extensive powers when it comes to Seizure of Assets. Those powers allow them to seize your property and to sell it. This happens if you keep avoiding the IRS. The IRS seizure is the ultimate act of their collection efforts.
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  8. UNFILED TAXES (You Lose Your Freedom)
    Failure to file tax returns may be a criminal act punishable by one year in jail for each year not filed. The IRS may file "SFR" (Substitute For Return) Tax Returns for you. This is the IRS's version of an unfiled tax return, which is actually an inflated tax assessment against you. You always have the right to file your own return, no matter how late it is. You don't go to jail when you can't pay, but you might if you don't file.
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