Do you owe back payroll taxes to the IRS? If so, you're likely wondering what your repayment options are. Failing to make arrangements to settle this debt in a timely manner can put your business at risk. The good news is that you can get business tax relief from an IRS installment payment plan. 
Possible Consequences of Unpaid Payroll Taxes
The IRS takes unpaid payroll taxes very seriously. Legally, failure to submit these taxes each quarter is a crime and business owners can be subject to imprisonment for neglecting this requirement. Along with jail time the IRS can also levy substantial financial penalties for non-compliant employers. 16 days after the deadline for filing your Form 941 you can be subjected to a 33 percent penalty in addition to the original tax owed. If the debt remains unpaid the IRS has the authority to close your business and intercept any payments from your clients to settle the debt. Once the IRS decides to pursue your business for failure to submit payroll taxes the agency can also take action against anyone connected to the business including employees, accountants and shareholders.
Get Assistance from a Tax Professional
Since the IRS takes such a strong stance against companies that owe unpaid payroll taxes it's wise to get assistance from a tax professional that has experience dealing with this particular issue. While you have the choice to represent yourself in these proceedings doing so can be overwhelming, especially if you don't know all of your tax settlement options. Hiring a tax resolution specialist can ensure that you get access to the tax relief provisions that are available to you.
Take Action Right Away
Whatever action you decide to take it's essential that you do so right away. Waiting too long can give the IRS time to close your business, place you in jail or investigate all of your employees. As the time goes by the amount of your penalties and interest also add up quickly. Even if you're able to keep the IRS from physically closing your business the amount of debt you may have to pay back can be enough to sink your company. If you set up an IRS installment payment plan, however, you'll have the opportunity to decide how much of your debt you can repay so that your payments don't swallow up your operating income.
Settling a past payroll tax debt with the IRS can be intimidating. Seeking the advice of a qualified tax resolution specialist, though, can help you get through this process without negatively affecting your business's bottom line.
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If you're facing wage garnishment you may be unclear about the process. It's important to find out exactly how the wage garnishment procedure works so that you can make plans to repay your debt as quickly as possible and stop wage garnishments. To do this you'll need to clear up a few wage garnishment myths: 
1. My employer has to ask my permission before garnishing my wages.
This is untrue. Once your employer receives a notice that your wages are subject to garnishment, he or she is legally obligated to comply immediately. Your boss does not have to inform you of the garnishment.
2. I won't receive any notice before my wages are garnished.
Legally, the government is not required to inform you of an upcoming garnishment. However, individuals generally receive several notices before collection action is taken.
3. I can't stop wage garnishment from happening once I get a final notice.
A final notice is issued after several previous notices have been disregarded. After you receive a final notice you'll have 30 days to either request a hearing or establishing an arrangement for repayment. If you do not take these steps within the 30 days your wages will be garnished.
4. The government has to leave me enough money to cover my expenses.
The government does not have to consider your other financial expenses during the garnishment process. Legally, you can be left with less than $200 on each check if you're single and less than $300 if you're married.
5. If my wages are garnished, my employer can fire me.
Your employer cannot fire you for one wage garnishment levy. However, if you have two garnishments your employer can legally terminate your employment. This also applies if you have more than one debt that is being repaid through garnishment at the same time.
6. Child support and back taxes are the only debts that can be collected through garnishment.
While taxes and child support are the most common debts that are collected by wage garnishment other debts can also be repaid through this procedure. Student loans, past due court fines and civil monetary judgments can all be collected in this manner.
7. The government can only garnish my wages for one debt.
This is an important myth to clear up, since you can be fired for more than one wage garnishment as mentioned above. If you have multiple past due debts the government can garnish your wages for all of them at the same time.
Wage garnishment poses real financial risks to employed individuals. Understanding the truth about some common wage garnishment myths and consulting a tax resolution specialist can help you decide how to resolve your past debts quickly.
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The IRS offers many income tax incentives and deductions to small business owners. Among these provisions are deductions for health insurance, asset depreciation and credits for those affected by the Alternative Minimum Tax (AMT). Business owners who take advantage of this tax help for small business from the IRS may be able to significantly reduce their tax liability. 
Health Care Tax Credit
Companies that employ 25 or fewer workers and pay at least half of their employees' health insurance costs may be eligible for the health care tax credit. To qualify employee wages must fall between $25,000 and $50,000 annually. Through 2013 company owners can claim up to 35 percent of their costs as a tax credit on their business tax return.
Deduction for Self-Employed Health Insurance
A recent change in the tax law allows self-employed taxpayers to deduct a portion of their own health insurance costs from both their business income and their self-employment taxes. To claim this deduction, taxpayers must be paying for their own insurance costs.
Section 179 Depreciation Deduction
The Section 179 depreciation provision allows taxpayers to write off the entire cost of equipment and computer software in one tax year rather than depreciating it gradually over the course of its useful life. Depending on the purchase, this deduction can greatly help to offset business income and reduce tax. The Section 179 depreciation deduction can be used on purchases up to $500,000, but the provision began being phased out in early 2012. In order to claim a Section 179 deduction a business must have a profit for the year.
Additional Deduction for Bonus Depreciation
Bonus depreciation is a tax provision that enables business owners to write off depreciation even if the business reported a loss. Typically, depreciation can only be used as a business expense to offset income, but by claiming this deduction, taxpayers can claim these costs even if they had no taxable income that year. This option is only valid on new purchases of equipment or other assets.
Auto Depreciation
The IRS has expanded the first-year depreciation allowances for cars, trucks, and other vehicles that are placed into service for business use. Taxpayers should consult the IRS guidelines to learn exactly how much they can deduct for their business vehicles.
General Business Credit
In 2010 the IRS allowed business owners who were affected by the Alternative Minimum Tax to claim their General Business Credit deductions. Prior to that year taxpayers who were subject to AMT were disallowed from these deductions.
The IRS has extended several credits and deductions that can provide tax help for small business owners. Taxpayers who need assistance navigating the tax guidelines should seek the advice of a qualified tax resolution professional.
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Tax liens can cause a financial headache for individuals who owe back taxes to the IRS. Once a lien is imposed, individuals may lose access to their property, cash and other assets. To avoid falling into this situation, it's best for taxpayers to learn how to prevent tax liens in the first place. 
About Tax Liens
Basically, a tax lien is a claim that the government places on your assets. This lien serves as a way of notifying courts that the federal government has the right to seize your property in case of a bankruptcy proceeding or if you decide to sell your property for any reason. In a way, the lien also serves as form of security against the outstanding balance you owe.
How a Tax Lien Can Affect You
A tax lien typically "freezes" your credit and assets. This means that you won't be able to apply for additional financing while the lien is in place, which can be particularly difficult for taxpayers who run a small business. Tax liens are also enforceable against assets you acquire after the lien is imposed. If a tax lien is placed on your assets, the notice will be a matter of public record, which means it may appear in your local newspaper. The tax lien will also appear on your credit report, potentially damaging your credit for some time. If you're trying to sell real estate that has been affected by a tax lien you won't be able to complete the sale until the lien is removed.
Avoiding Tax Liens
Since tax liens have such a negative impact it's wise to take steps to prevent them. The best way to avoid a tax lien is to establish a payment plan with the IRS. This serves to inform them that you do intend to repay your back tax debt. If you're unable to keep up with the payments or if you fall into financial difficulty you may receive a collection notice from the IRS. You can try to appeal this action to gain some more time. But if the appeals procedure seems daunting or if you need additional help, contact a tax resolution specialist who can recommend other tax relief options such as an offer in compromise.
Learning how to prevent tax liens can be a financial lifesaver for taxpayers who owe back taxes to the IRS. By getting help from a qualified tax resolution specialist, you can prevent or remove tax liens efficiently.
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Do you owe back taxes to the IRS because a life emergency prevented you from filing your return on time? If so there's a possibility that you'll qualify for an IRS relief provision called penalty abatement. If you're able to get an abatement, you may be able to have your late filing penalties forgiven. However, qualifying for this provision is not easy and the IRS will not offer it to you simply because you made an error on your forms or forgot to send in your return on time. If you'd like to inquire about receiving penalty abatement don't deal with the IRS alone. Request the assistance of a qualified tax resolution specialist. 
What is Penalty Abatement?
In short, penalty abatement is when the IRS forgives any outstanding late filing or payment penalties on your account. You'll still owe the back tax amount but without the compounded penalties that accrue during each month the payment is late. Generally, this provision is only extended to taxpayers with legitimate emergencies that prevented them from sending in their returns on time or contributed to mathematical errors that resulted in an underpayment of tax.
Qualifying for an Abatement
Typical situations that qualify for a penalty abatement include the death or prolonged illness of a family member, a medical emergency or rehab stay for the taxpayer himself or a natural disaster that causes the taxpayer to lose his tax documents. You might also qualify for abatement if you acted on incorrect advice from a tax professional that resulted in you paying too little tax. However, to claim that situation, you'll have to apply for abatement within one to four years after the tax was due.
Why You Need a Tax Resolution Specialist
Even if you have the necessary circumstances getting penalty abatement from the IRS is tricky. Revenue agents must decide if your tax underpayment was due to mathematical error or fraud. In most cases, the IRS assesses a 25 percent penalty if an individual paid too little tax due to a math mistake. However, cases that the IRS considers fraudulent are subject to a 75 percent penalty as well as continual interest and late filing penalties. To make the case that your return involved a clerical error you need the assistance of a tax resolution specialist who can help you avoid incriminating yourself and help you supply proof of your claim.
Qualifying for IRS penalty abatement is a complicated procedure so make sure you don't try to deal with the IRS alone. Hiring an experienced tax preparation help professional can help you receive this IRS tax relief provision.
As tax time approaches taxpayers may be wondering if there are any options they can use to lower their income taxes. In order for any deduction to count for the tax year, it must have been made by December 31. Here are 6 tips to reduce your 2011 taxes. 
Contribute to a Qualified Charity
To claim the deduction, you must make the donation to a registered non-profit organization and you'll need to get proof of your contribution from a cancelled check, a credit card transaction, or a receipt from the organization itself. Remember to qualify as a deductible contribution the donation should have been made prior to December 31.
Make Home Improvements That Improve Energy Efficiency
The IRS allows taxpayers to claim deductions for certain energy efficient home improvements such as installing a tankless water heater, solar lighting panels, or upgrading to energy efficient windows. Depending on the type of home improvement done, you may qualify to deduct up to 30 percent of the installation and purchase price as a deduction.
Adjust Your Investment Portfolio
You can deduct up to $3,000 per year in capital losses and you can carryover the excess losses to future years. If your portfolio is showing lots of taxable gains as of the beginning of December, you might consider selling some of your stock shares to reduce the impact of those gains as much as possible.
Top up Your Retirement Accounts
Making the maximum allowable contribution to your retirement plans is a great way to take a tax deduction. The IRS allows taxpayers to contribute up to $5,000 to IRA plans and senior taxpayers can contribute up to $6,000. These contributions can go a long way to help with tax liability.
Use Your IRA to Make a Charitable Donation
If you're over the age of 70 1/2, you can claim an additional charitable donation deduction by having a donation sent directly from your IRA plan. Instead of claiming this donation as an itemized deduction, you'll be able to exclude the amount you donated from your gross income for the year.
Claim the Small Business Health Care Tax Credit
Small business owners who pay for at least half of their employees' health care premiums may qualify to claim up to 35 percent of these costs as a tax credit on their business income.
As tax time approaches, many taxpayers may be worried about their impending bill from the IRS. By using these tips to reduce 2011 taxes and consulting with a qualified tax resolution specialist you can substantially reduce your tax liability.
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If the tax deadline for last year passed you by you might think it's too late to file your return. The truth is you can file a tax return at any time even if the deadline has come and gone. However, the sooner you submit your return the better off you'll be. Here are five reasons to file delinquent tax returns to the IRS. 
1. Neglecting to File a Return is Illegal.
First of all, not completing your federal income tax return is technically a crime. Tax law requires that all taxpayers who have earned enough money to report their income to the IRS do so by the filing deadline each year. The IRS has placed several people in jail simply for failing to complete their income taxes on time.
2. The IRS Assesses a 25 Percent Penalty for Late Filing.
Another reason to file a delinquent return is that it helps you lessen the impact of late filing penalties. The IRS charges a 25 percent penalty immediately when your return is not filed by the tax deadline. This penalty even applies to taxpayers who receive tax extensions. All the extension does is give the taxpayer more time to complete their forms. The tax they owe is still due by the deadline. It's best for those who apply for extensions to send in a payment based on an estimate of their tax liability before the filing deadline for that year.
3. You May Be Subject to More Penalties.
On top of late filing penalties you will also accrue failure to pay penalties on the amount of tax you owe. This penalty is compounded monthly so your tax bill will continue to grow until you settle your account. In addition to the penalties, your account will also generate interest which you'll be responsible for paying.
4. The IRS May Prepare a Return for You.
While this may sound like less work for you it's really not. If the IRS prepares your return the agency will limit your deductions and exemptions to the bare minimum which will cause you to pay more in income tax.
5. You Won't Qualify for Tax Relief Until You File for Past Years.
Should you need to take advantage of tax relief provisions such as an offer in compromise, you won't even qualify to apply for them if you have unfiled tax returns that have not been filed. Clearing up your outstanding tax record will make it easier for you to request tax relief.
In short, it's always in your best interest to file delinquent tax returns to the IRS. If you need assistance preparing your forms, consider hiring a tax resolution specialist to assist you.
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All employers who hire workers have to submit payroll taxes to the IRS each quarter. Problems arise when a business doesn't have the funds to pay these taxes on time. Companies may run into trouble when their customers don't pay their invoices on time because this may cause them to run out of the money they need to submit their taxes to the IRS. Legally, the IRS can close a business for failure to pay payroll taxes in a timely manner. If you fall behind on your payroll taxes there are a few steps you can take to settle your account. 
Get Current on Your Past Returns
The first thing to do is to get caught up on your entire past payroll tax returns. If you haven't submitted a few of them due to concerns about funds complete those and send them in right away. You should do this even if you don't have the money to pay the taxes you owe. Once you've completed the past forms set aside enough money to pay the payroll taxes that are due for your most recent quarter. Then make sure that you complete your forms and pay your payroll taxes from there forward. This will leave you with only the back payroll taxes to settle and will likely keep the IRS from closing your business.
Don't Contact the IRS on Your Own
To settle the back payroll taxes it's essential that you don't talk to the IRS by yourself. Revenue agents may attempt to get to you to incriminate yourself in a phone conversation by asking questions about how your business is run or the number of employees you have. Make sure that no employees in the office speak with IRS agents about the business.
Enlist the Help of a Tax Specialist
Hiring the assistance of a qualified tax resolution specialist is a great way to protect yourself from IRS collections. There are several tax relief programs that you may qualify for including an offer in compromise or penalty abatement. An offer in compromise may allow you to have your entire tax debt forgiven while penalty abatement can help you avoid paying any additional late filing penalties on top of your back payroll taxes. An experienced tax resolution specialist can assist you to apply for these and other relief provisions.
If you're behind on your payroll taxes don't panic! By completing all of your past returns, paying your current tax due, avoiding contact with the IRS and getting a tax specialist to help you you'll be able to settle your payroll tax problems and keep your business open.
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While most individuals are familiar with common deductions such as home mortgage interest, charitable donations and self-employment expenses, there are many other tax deductions that can lower an outstanding balance or increase a refund. Here are 10 of the most overlooked tax deductions. 
1. State Income Taxes
If you paid a balance due on your state income tax returns last year you can write off those taxes as an itemized deduction. Enter the amount of state and local income tax you paid on Line 5 of Schedule A.
2. Military Homebuyer Credit
Military members qualified to use the First-Time Homebuyers Credit for homes they purchased during the first four months of 2011. If you're a member of the Armed Forces and you purchased a home in early 2011, you may still qualify for the Military Homebuyer Credit on your 2011 return.
3. Section 179 Depreciation
Business owners and self-employed taxpayers who place a new asset in service that has a useful life of less than 20 years have the option to write off all of the depreciation at once in one tax year. This is commonly used for small equipment such as computers and office machines.
4. Travel Expenses
You may be able to write off the cost of gas, airfare and up to 50 percent of your meals on business travel. However, if your employer reimbursed you for those expenses you won't be eligible to claim the deduction.
5. Energy Efficient Home Improvements
Installing energy-saving appliances and modifying home construction to use alternative energy is another way you can reduce your taxes. If you made an energy-saving purchase in 2011, you can write off up to $500 of small adjustments and up to 30 percent of appliances.
6. Refinance Home Points
If you refinanced your home this tax year you can deduct the points you paid to complete the transaction. These points are deducted on Schedule A along with your mortgage interest.
7. Travel for Charitable Organizations
Mileage you accrue while assisting a charitable organization is also deductible. This includes travel to and from the organization's building, job site or drop-off location.
8. Employment Search Expenses
The costs you incurred while searching for a new job may be deductible if you were searching for employment in the same field as your previous job. Qualified expenses include mileage, the cost of printing resumes and fees paid to an employment agency.
9. Moving Expenses
You can also deduct the cost of relocating more than 50 miles for a new job. Eligible expenses include mileage, truck rental and packaging expenses.
10. The American Opportunity Credit
If you went back to school this tax year, you can deduct up to $2,500 of your college tuition and expenses on your return. This credit is refundable, which means you can receive some of it as a refund.
Taking advantage of the 10 most overlooked tax deductions can help you receive a larger refund this year. If you need help determining your eligibility for any of these tax breaks and customized tax planning, contact a tax resolution professional.
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Have you missed filing a couple of your past federal income tax returns? If so, you may be feeling nervous about what action the IRS may take against you. While there are potentially harsh financial consequences for not reporting your income to the IRS, you can easily clear up any unfiled tax returns by preparing your forms and submitting them as soon as possible. If you're wondering what you can do about unfiled tax returns you may find this information helpful. 
Why You Need to File Past Returns
There are several reasons why you should file your unfiled tax returns from previous years. For one thing, submitting your past forms keeps you in compliance with federal tax law. This alone can contribute to your peace of mind. Along with the conscientious benefit of filing your previous returns, you'll also benefit financially. If you owe outstanding balances from previous years, your account with the IRS has been accruing interest and late filing penalties all this time. Filing your previous years' returns will help you clear up any outstanding charges.
How to Get Started
The first thing you need to do is collect all of the necessary documents to prepare your past returns. You'll need to get copies of IRS Form 1040 for the years you haven't filed, as well as the supporting documents and schedules you'll need to complete. For example, if you need to report self-employment income, you must complete Form 1040 along with Schedule C "Profit or Loss From Business". If you plan to itemize your deductions, you'll need to complete Schedule A. You will also need to track down receipts and paperwork that support the deductions and income you'll report on your past return.
Submit the Returns with Any Necessary Payments
Even though the previous years' returns may be long overdue, you should still submit them to the IRS as you would a current year's return. The IRS does not allow taxpayers to file past returns electronically, so you'll have to complete paper forms and mail them to the appropriate mailing address for your state of residence. If you calculate that you owe a balance, enclose the voucher from Form 1040-V along with either a check or money order. If you're unable to pay your entire balance in full you can arrange an installment plan that will help you pay your balance gradually.
Clearing up unfiled tax returns doesn't have to be a complicated process. By preparing your forms and filing them, you can place your account back in good standing with the IRS. If you need assistance filing your forms, seek help from a qualified federal tax resolution professional.
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