For many Greater Columbus Ohio small business owners, and families, it can seem that the government has simply been throwing money around and not paying attention to what is done with it, or collecting what is due.
After all, there is a backlog of notices that the IRS is STILL sending out, which delayed the beginning of their acceptance of tax returns this year until February 12.
Many of these backlogged notices are being sent out with WRONG information, but it is still causing great panic among those who receive them.
If you have received a notice from the IRS, get help here:
But if you believe that simply because there is an administrative backlog, that the IRS won’t come hunting for ways to recapture lost revenue … you’d be wrong.
But there are limits to the IRS’ power, and we can help you stand up for yourself…
1) They must “consider” settling your debt.
(Internal Revenue Code 7502):
We’re talking here about the Offer in Compromise (OIC), and they are indeed authorized to settle for less than the full amount that you owe. In fact, they always have to listen to an offer.
But be careful — not everyone qualifies for an offer in compromise. The IRS has very rigid guidelines for examining an offer in compromise. The IRS will look at your household income, living expenses and asset values, and determine if they can collect the FULL amount owed from you. In most cases, to accept a compromise, the IRS has to be convinced that they will never collect the full amount owed from you. If so, then they can agree to settle for a lower amount, representing what can be paid and recovered.
Usually, you need help for this process.
2) The IRS MUST give you notice before a levy, and give you the right to an appeal.
(Internal Revenue Code 6330 and 6331(d)):
The IRS must send you a letter before they can take your property, and give you 30 day notice beforehand. This letter is called a “Final Notice of Intent to Levy”. After you receive a Final Notice, tax laws give you 30 days to file an appeal to dispute the IRS levy, stop it from happening, have a hearing with an IRS appeals officer to reach an alternative solution to levying, and, ultimately if all else fails, petition the US Tax Court for additional review. This is called a “collection due process appeal” — and all IRS enforcement is on hold while you exercise your rights to appeal.
3) The IRS can only levy or seize your property when it results in financial recovery
(Internal Revenue Code 6331(f) and 6331(j)(2)(c)):
This is known as the “no equity rule”. In other words, the IRS can only seize your property if it results in payment to them. For example, if you have a Camaro that is worth $10,000 and has a $10,000 loan on it, an IRS seizure will only get your bank paid on the loan. There will be nothing left for the IRS as there is no equity in it for them. Because of that, they legally cannot seize it. Same is true for your Greater Columbus Ohio house. The no equity law eliminates the vast majority of IRS seizures.
4) The IRS only has 10 years to collect your unpaid tax debt
(Internal Revenue Code 6502):
After 10 years expires, the IRS must, by law, put a credit on your account for the amount that cannot be collected, and move your account balance to zero. The time to collect begins when the IRS first puts a balance due on its books, and ends 10 years later. The end is known as the “IRS collection statute expiration date”. By law, owing the IRS is not forever.
And, of course, with our help, it’s much, much less.
We’re in your corner.
Chuck Franklin CPA, LLC