My tax problem is…
… notice from the IRS demanding payment / for unfiled returns!”
4 Steps to DECODING your notice, TAKING CONTROL of your tax issue, and GETTING the IRS OUT of your life…
once and for all!
Is your IRS notice one of these? They’re the most common IRS notices that our clients receive. Click on one to learn more!
CP2000. CP19. CP503. CP504. CP90. CP297. CP91. (We need to make these a certain type of button. My inclination is to think that there is a shortcode I can use to do this.
#1 – Relax! Don’t Panic!
I’m not just saying this a fluffy kumbaya thing. I say it because panicking is one of the EASIEST ways to sink your case.
For one, obviously, it’s easier to solve a problem if you’re calm and not panicking. Panicking leads to bad decisions, and digging the hole deeper. I can’t count the number of times I have seen people panic, call the IRS, and get talked into a payment deal that they couldn’t possibly afford (only to default and have an even BIGGER problem down the road)!
Secondly, the IRS is much more likely to worth with you in a fair manner if you are cool, calm and collected (they get people calling at them swearing, yelling or freaking out daily). Be professional, and you’ll get a lot more mileage, even if you go it alone, or with a professional.
#2 – Figure out if your notice is the result of an IRS error.
Don’t bank on this, but I hear about and see IRS errors enough to know you should look for them first. For example, is it related to identity theft? Is the amount they are claiming you owe because of a W-2, 1099, or K-1 that was filed incorrectly? Did you make a typo on your tax return?
If you are looking at your notice, and genuinely do not know why they claim you owe what they’re saying you owe, you should get on the phone with them (use the number at the top of their notice) and tell them so.
However, if you do know that you owe what they’re claiming, don’t use this as a bad-faith attempt to stall out the IRS. That lowers your credibility with them, and makes them want to proactively hunt you down, rather than wanting to work with you.
#3 – Figure out where you are on the IRS collections process.
Is this just an initial “hey, please pay us”, or “we’re going to start siphoning your wages if you don’t respond”?
Regardless of where you are on the list, you need to deal with the problem. But further back in the process, you have more time.
#4- Is the notice a symptom of a larger problem that needs to be solved?
A notice just says “you owe us money”. But there’s an untold story behind the notice that represents the real basis for your tax issue:
Why didn’t you pay? Why couldn’t you pay? Would you have paid if you could? Did you know that you had to pay, or is this coming totally out of the blue? Was it a unique life situation in that year that caused the problem?
If the answer is “it was a simple mistake I can pay now”, maybe no further introspection is required. Just pay it and move on with your life!
But, if the notice and your tax problem is really just a symptom of an problem in your life…such as job loss, a failed business, a medical condition…or you truly just don’t have the money to pay, you need to start thinking about what your next step is. The IRS is not going to forget, and they’re not going to forgive, unless you proactively approach them with a proposed solution to your tax problem!
#5 – Figure out what to do about your notice.
Candidly, some people can almost always solve their tax problem without professional help!
- Do you know you owe, and it’s a small amount you can just pay now?
- Is the amount less than $10,000, and you know you owe?
- Are you the “weekend warrior” type who doesn’t mind learning a thing or two about the IRS to resolve your small balance due?
Then consider doing it yourself!
But what if one of these is your tax problem?:
- Large balance due
- You don’t think you owe the amount
- You simply don’t have the money to pay!
- The IRS is threatening to take your wages or bank account money
- You have business taxes in the mix too
- Your tax problem came from a traumatic life event such as job loss, medical condition, or failure of a business.
If you are one of the millions of people who have a tax problem like the ones listed above, there is a treasure trove of options available to solve your tax problem, and get the IRS out of your life, once and for all!
But like any valuable, the treasure needed to solve your IRS problem is stored in a well-fortified vault. So what’s the key to the IRS vault?
The hundreds of pages of dense rules, regulations, and laws!
Master those laws, and you can crack the IRS safe each and every time to get a fair resolution that gets the IRS out of your life, once and for all!
But try to track the safe and fail? And just as easily end up with a poor resolution that takes too much money out of your pocket, that you’ll default on later, and wind up with an even bigger problem!
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