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410-484-4900
Maryland Tax Lawyer - Jack I. Hyatt, Attorney at Law - 410 - 484 - 4900 - 24/7
Click On Link www.marylandtaxlawyer.info
We can help to:
Have you received a notice from the IRS that there is a deficiency in your taxes? Have you received a notice that the IRS plans to file a lien on your property or garnish your wages for past taxes? Have you received a bill from the IRS for taxes from a joint return for which it is unfair to hold you responsible? Have you received a letter f rom the IRS about your Earned Income Tax Credit (EITC or EIC)? Do you owe a tax debt that you are not able to pay? If any of these things has happened to you, we can help. Call Maryland Tax Lawyer Jack Hyatt 410-484-4900 24/7. We can help with:
If any of these things has happened to you, then the we can help you. To learn if you qualify for the assistance of call 410-484-4900. Examples of issues that can result in lower taxes for you are: Taxation of New U .S. Taxpayers - the rights and responsibilities of US Taxpayers. Your federal income tax filing status - the five filing statuses available to taxpayers. Dependent Exemptions - whom you can claim as a dependent. Child Care Tax Credit - the tax credit for work-related child care expenses. Child Tax Credit - a tax benefit for people with low or moderate incomes. Earned Income Tax Credit - a tax benefit for working people who earn low or moderate incomes. This is a different credit than the child tax credit. Innocent Spouse Relief - Has the IRS sent you a bill for taxes owed on a joint return, but you believe it would be unfair to hold you responsible for these taxes? You may be able to do something about it. Injured Spouse Claim - Did you file a joint return with your spouse and expect a refund, but now the IRS is keeping the refund to pay a debt of your spouse? You may be able to do something about it. Individual Taxpayer Identification Number (ITIN) - If you cannot get a valid Social Security Number, then how are you to file a tax return? Here's how. Jack I. Hyatt is experienced in providing practical and effective solutions to tax, IRS, business, estate planning and asset protection problems. Every taxpayer deserves a fair defense against the IRS. I can save your family, business, home, and way of life from IRS abuse. If your IRS debt has you cornered and you want to stop it dead in its track, contact me today. I have the knowledge you need to fight and beat the IRS. Call Maryland Tax Lawyer Jack Hyatt 410-484-4900. Do you need to stop or prevent your personal or business finances from descending a slippery slope of tax problems. Call Maryland Tax Lawyer 410-484-4900.
We provide services to find practical solutions and achieve eliminate:
Tax Levys A Tax levy, under United States Federal law, is an administrative action by the Internal Revenue Service (IRS) under statutory authority, without going to court, to seize property to satisfy a tax liability. The levy "includes the power of distraint and seizure "by any means".[1] The general rule is that no court permission is required for the IRS to execute a section 6331 levy.[2] For taxpayers in serious debt to the IRS, the most feared weapon in the IRS arsenal is the tax levy. Using the powers granted to the IRS in the Internal Revenue Code, the IRS can levy upon wages, bank accounts, social security payments, accounts receivables, insurance proceeds, real property, and, in some cases, a personal residence. Under Internal Revenue Code section 6331, the Internal Revenue Service can “levy upon all property and rights to property” of a taxpayer who owes Federal tax. The IRS can levy upon assets that are in the possession of the taxpayer, called a seizure, or it can levy upon assets in the possession of a third party, a bank, a brokerage house, etc. All future statutory references will be to the Internal Revenue Code unless noted otherwise. Procedural requirements The Fifth Amendment of the Constitution forbids the government (whether state or federal) from taking an individual’s property without due process of law. This rule applies to an IRS levy. To comply with the U.S. Constitution, the IRS must provide the taxpayer notice of the coming levy and an opportunity to be heard.[3] Under §6330(a)(2), the IRS must send to the taxpayer a notice by either personal hand delivery, or through certified mail, or left at the taxpayer's usual place of business. The notice must arrive at least thirty days prior to the levy taking place. The “Notice of Intent to Levy” must include “in simple and nontechnical terms the right of a person to request a hearing during the 30 day period” before the levy will be effective. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. This hearing is referred to in IRS correspondence as the “Collection Due Process” or CDP hearing. The notice will include the IRS Form 12153 which the taxpayer can fill out and mail in to request a hearing. A taxpayer is entitled to one CDP hearing for each tax period (tax year) to which the levy applies. The hearing must be held before a neutral, impartial hearing officer “who has had no prior experience with the respect to the unpaid tax…”[4] At the hearing the taxpayer may raise challenges to the collection actions, may seek innocent spouse relief, and may present alternative collection actions such as installment agreements or an offer in compromise. Under certain limited circumstances the tax debtor may challenge the underlying tax liability. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. If the taxpayer is unhappy with the decision at the CDP hearing, he or she may contest the decision at the United States Tax Court or at a feder Post procedural matters If none of the above procedures effectively stops the levy, the IRS can proceed to take the property of the taxpayer. While the IRS can levy on most items of property, subject to limits imposed under section 6334. The list of property exempt from levy is short, and may not apply to some taxpayers. Once the IRS has the “green light” to levy, it can then demand that the taxpayer's employer send a portion of the taxpayer's wages to the IRS. The IRS can order a bank at which the taxpayer holds an account to send the proceeds in the bank account to the IRS. Social security proceeds and state and federal tax refunds can be levied easily. OFFER AND COMPROMISE The Offer in Compromise (or OIC) program, in the United States, is an Internal Revenue Service (IRS) program under 26 U.S.C. § 7122 which allows qualified individuals with an unpaid tax debt to negotiate a settled amount that is less than the total owed to clear the debt. A taxpayer uses the checklist in the Form 656, Offer in Compromise, package to determine if the taxpayer is eligible for the offer in compromise program. The objective of the OIC program is to accept a compromise when acceptance is in the best interests of both the taxpayer and the government and promotes voluntary compliance with all future payment and filing requirements. • Qualifying conditions At least one of three conditions must be met to qualify a taxpayer for consideration of an OIC settlement: • Doubt as to Liability — Debtor can show reason for doubt that the assessed tax liability is correct • Doubt as to Collectibility — Debtor can show that the debt is likely uncollectable in full by the IRS under any circumstances • Effective Tax Administration — Debtor does not contest liability or collectibility but can demonstrate extenuating or special circumstances that the collection of the debt would "create an economic hardship or would be unfair and inequitable." This Offer in Compromise program is available for any taxpayer, but is primarily used by individuals that are elderly, disabled, or have special extenuating circumstances. • Doubt as to collectibility Doubt as to collectibility means that the taxpayer will never be able to fully pay the tax bill. The IRS will consider a settlement based on the following formula: Settlement Amount = (monthly disposable income x a number of months) + the net realizable equity in the taxpayer's assets. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Disposable income is monthly income minus allowable monthly expenses. It is important to recognize that the IRS will not allow all expenses that you may actually have. Common disallowed expenses are college tuition payments for a dependent and credit card payments (disallowed since they represent unsecured debt). The number of months over which disposable income must be calculated into the offer amount is based on the smaller of the number of months remaining until the Collection Statute Expiration Date (CSED) for the tax debt OR either 48 or 60 months, depending on the payment option for the OIC which the applicant is selecting. Net realizable equity in assets is the quick sale value of the asset (often 80% of Fair Market Value (FMV)) minus any liabilities which are secured by the asset (e.g., a loan). As an example, if a taxpayer has a home worth $100,000 and owes $50,000 on the home, the IRS will calculate the net realizable equity in the asset as follows: ($100,000 x .80) - $50,000 = $30,000. The IRS expects, in this example, that the $30,000 will be included in the Offer amount. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. If a taxpayer believes he or she qualifies, the taxpayer completes a financial statement on a form provided by the Internal Revenue Service. Wage earners and self-employed individuals use Form 433-A. Form 433-B is for Offers involving all other business types. These financial statements identify all assets and liabilities as well as disposable income. Partial payment Effective July 15, 2006, the IRS made changes to the Offer in Compromise program requiring that an up-front twenty percent, non-refundable payment plus USD$150 be submitted along with the Offer of Compromise in the case of a cash offer. An Offer submitted without the required fees is subject to rejections without appeal. After the IRS receives the Offer, the IRS has two years to make a decision. If the decision is not reached by that time, then the Offer is automatically accepted.[1] Under the Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA 2005) if a taxpayer chooses to make payments over time, i.e. monthly, the taxpayer must include with the offer the first month's payment. The taxpayer is not required to submit the 20%, which applies only to the lump sum payment option. Then during the time that the offer is being considered by the IRS, the taxpayer must keep making the monthly payments to keep the offer current. If the taxpayer fails to make the payments, the offer will be returned to the taxpayer. In the case of both the $150 application fee and either the 20% down payment or the monthly payments, a low income taxpayer may be exempt from both. The taxpayer should review the Form 656A to determine whether these fees and payments apply to them. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Effect of an Offer in Compromise on IRS levy or lien An Offer in Compromise will have no effect upon a tax lien. The lien will remain in effect until the offer is accepted by the IRS and the full amount of the offer has been paid in full. Once the offered amount has been paid, the taxpayer should request that the IRS remove the lien. An offer in compromise will stop tax levies under section 301.7122(g) of the US Federal Tax Regulations. That regulation states that the IRS will not levy upon a taxpayer's property while a valid offer in compromise (an offer that has been accepted for processing) is pending and, if rejected, for thirty days after the rejection. If the taxpayer appeals the rejection, the IRS cannot levy while the appeals process is ongoing. If a levy is in place when the offer is submitted, it is not automatically released. How Long Can the IRS Collect Back Taxes or Audit My Tax Return? Many people incorrectly believe that the IRS can collect back taxes until the day you die. Some believe the IRS can collect taxes even after you are dead. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Fortunately, the law isn't that bad. The statute of limitations limits the time during which an action can be brought by the IRS for a tax audit and the time for IRS tax collection activities. Generally, there is a 3-year statute of limitations for the IRS auditing a tax return and a 10-year statute of limitations for the IRS collecting tax. You should be aware that the states may be very different. California, for example, has NO statute of limitations on the collection of back taxes. Under section 6501(a) of the Internal Revenue Code (Tax Code) and section 301.6501(a)-1(a) of the Income Tax Regulations (Tax Regulations), the IRS is required to assess tax within 3 years after the tax return was filed with the IRS. Similarly, under 301.6501(a)-1(b) of the Tax Regulations no proceeding in court by the IRS without assessment for the collection of any tax can begin after the expiration of 3 years. Under section 6501(e) of the Tax Code and section 301.6501(e)-1 of the Tax Regulations the statute of limitations is 6 years if the taxpayer omits additional gross income in excess of 25% of the amount of gross income stated in the tax return filed with the IRS. If the tax return was prepared by the IRS under the authority of section 6020(b) of the Tax Code the statute of limitations does not apply. See section 6501(b)(3) of the Tax Code and section 301.6501(b)-1(c) of the Tax Regulations. The statute of limitations does not apply in the case of a false tax return or fraudulent tax return filed with the IRS with intent to evade any tax. See section 6501(c)(1) of the Tax Code and section 301.6501(c)-1 of the Tax Regulations. For assessments of tax or levy made after November 5, 1990, the IRS cannot either collect or levy any tax 10 years after the date of assessment of tax or levy. See Section 6502(a)(1) of the Tax Code and section 301.6502-1 of the Tax Regulations. Court proceedings must also be started by the IRS within the 10 year statute of limitations. Section 301.6502-1(a)(1) of the Tax Regulations. For assessments of tax or levy made on or before November 5, 1990, the IRS cannot either collect or levy any tax 6 years after the date of assessment of tax or levy. See section 6501(e) of the Tax Code. However, if the 6 year period ends after November 5, 1990, the statute of limitations is 10 years. In order to come under the 6 year statute of limitations, the 6 year period must end prior to November 5, 1990. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. The 10 year statute of limitations can be extended by agreement between the taxpayer and the IRS provided the agreement is made prior to the expiration of the 10 year period. See section 6501(c)(4) of the Tax Code and section 301.6501(c)-1(d) of the Tax Regulations. Make sure you understand the starting date for the running of the statute of limitations, any exceptions to the tolling of the statute of limitations, the last day that the IRS can audit a tax return, and the last day that the IRS can collect overdue tax on a tax return. Statute of Limitations on Taxpayer to Claim a Tax Refund A taxpayer may file a claim for a tax refund of an overpayment of any tax within 3 years from the time the tax return was filed with the IRS or 2 years from the time the tax was paid to the IRS, whichever period is the last. If no tax return was filed with the IRS, the claim may be made within 2 years from the date that the tax was paid to the IRS. See section 6511(a) of the Tax Code. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Under section 6511(d)(1) of the Tax Code a taxpayer may file a claim within 7 years if the tax refund pertains to a bad debt under section 166 or 832(c) or in connection with a loss from a worthless security under section 165(g). How to Survive an IRS Audit We all dread the thought of having the IRS tell us it wants to review a previous year's tax return. If you get audited, your best bet is to seek out a qualified tax professional. But if you're a do-it-yourself type of person, here are a few tips you can use to help you survive the audit process. Don't ignore the notice. You generally have 30 days to respond to an audit notice. If you don't respond, the IRS can take action, such as automatically adjusting your tax liability, and the next correspondence you'll receive is a bill. Read and follow the notice. The audit notice will give you specific information as to what items are being examined. Knowing what's being scrutinized will help you determine what you need to bring to the audit, so you can substantiate the items in question. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Organize your records. Making the auditor's job easier will win you some points. The auditor will at least believe that you're an organized person and that all of your items are documented and justified. Don't be afraid to group the items in question, or attach an adding-machine tape that matches the tax return. That will allow the auditor to quickly review the important issues. Don't believe those who tell you that you can just throw your records in a bag, drop it on the auditor's desk, and shout, "You figure it out!" That just doesn't work. Remember, it's your legal responsibility to prove your deductions. Replace missing records. If you're going through your records and find that some of them are missing, call for duplicates immediately. Don't just go to the audit and claim that the records are missing or lost. That does you no good at all. At best, the auditor will request that you obtain the records. At worst, the deduction in question will be denied, since there are no supporting documents. Bring only what you're asked for. Leave at home any additional records and items not requested in the original audit notice. That way, if the auditor is curious about something else on the tax return, but the item was not on the original audit notice, you can politely tell him or her that those records are at home. It's likely that the issue will be dropped right there. Don't be a jerk! Contrary to popular opinion, all of the employees at the IRS are people, too. They have wives, husbands, and kids, and they're employed at the IRS because they're working in their chosen profession. And make no mistake -- they are trained professionals. Taking out your frustrations on an auditor will get you nowhere. Insulting the auditor verbally will not solve any problems. And assaulting one physically is a federal offense. Remember, these people are just trying to do their jobs. Be courteous, even if the auditor is not courteous to you or seems unreasonable. If you arrive at the audit with a large chip on your shoulder, you might make the auditor less willing to see things in your light. Provide only copies. Don't bring original documents to the audit. If you do bring originals, do not give them to the agent. Request that the agent make copies and give the originals back to you. Once you hand over your original documents, there's a very good chance that they will be misplaced or lost. Then you're the one left holding the bag, since the IRS isn't responsible for documents lost in its possession. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Stay on point. The auditor will be able to obtain some valuable information in what seem to be simple and friendly discussions. Asking about an expensive new car that you might have purchased, or that vacation to the Greek Isles, might give the auditor reason to believe that you're not reporting all of your income and thus expand the scope of the audit. When you meet with the auditor, in essence, you're providing testimony. So answer as many questions as possible with a simple "yes" or "no" response. If you must expand or explain, keep it brief and very much to the point. Don't give the auditor a reason to expand the audit because of your tendency to ramble on. Know your rights as a taxpayer. Remember that an audit is like a small trial. It is an adversarial exercise. So while you can disagree without being disagreeable, you must know your rights, the audit process, and the law behind the deductions you are claiming. Settling any difference at the audit level is generally best, but if you can't come to an agreement, you have rights that allow you to request a conference with the IRS Appeals Division. Be aware that appeals officers are even more senior than agents, with much more experience and knowledge behind them. If you're making a specious argument that the tax law doesn't support, the appeals officer will quickly shoot it down. However, if the issue is complicated and your argument is founded in tax law and court cases, the appeals officer can make quick work of the analysis -- and might just find in your favor. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. Again, your best bet if you're audited is to retain the services of a qualified and experienced tax pro who can argue your case without passion or prejudice. Such a person already knows the most effective ways to help you quickly resolve a conflict with the IRS. Hiring such a person is not cheap, but quality services never are, and you could pay a lot more if you don't hire a professional and the audit doesn't go well. The tax code has become so complicated that you're unlikely to know the law as it applies to your tax return and your rights as a taxpayer. That's why a qualified tax pro can be worth every dollar of his or her fee. But again, for those of you who decide to go the do-it-yourself route, stick to the game plan we've discussed here. And if you ever decide to remove your own appendix, well, good luck with that, too. For more tips on your taxes, learn about: •How to cut your taxes in 60 seconds. •What tax bracket you're in. •How to avoid tax scams. •How to get organized for the IRS. When he's not dealing with tax issues, Fool contributor Roy Lewis is a motivational speaker who lives in a trailer down by the river. He understands that The Motley Fool is all about investors writing for investors. You can take a look at the stocks he owns, as long as you promise not to ask him which stock to buy. He'll be glad to help you compute your gain or loss when you finally sell a stock, though. Call Maryland Maryland Tax Lawyer Jack Hyatt 410-484-4900. What to do if you missed the rally – "Investors are most bullish in two years," reports Reuters – yet they've yanked $100 billion out of stocks funds since 2009. If you missed the rally too, you must get back in – safely. Follow along as a professional invests $250k in a long/short portfolio of stocks, options, and ETFs. This is the first opportunity since June 2010, by invitation only. Enter email below. Call Maryland Tax Lawyer Jack Hyatt 410-484-4900 |
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