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IRS Tax Representation
Navigating the complexities of IRS issues can be daunting, but you don’t have to face them alone. At Fernandez CPA Firm, we are dedicated to providing expert IRS tax representation services to protect your rights and achieve the best possible outcomes.
Our experienced team is committed to supporting you through every step of the IRS process, ensuring your financial health and peace of mind.
By partnering with Fernandez CPA Firm, you gain access to a wealth of expertise and personalized strategies designed to resolve your tax issues efficiently and effectively. Whether you are facing an audit, need help with penalty abatement, or require assistance with negotiating tax debts, our IRS tax representation services are here to support you every step of the way.
We’ll try to cooperate fully with the IRS, because, as citizens, we feel a strong patriotic duty not to go to jail.
– Dave Barry
IRS Tax Representation Services
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Audit Defense
Penalty Abatement
Offers in Compromise
Installment Agreements
Innocent Spouse Relief
Wage Garnishment and Tax Levy Release
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Frequently Asked Questions About Tax Resolution
1. What happens during an IRS audit?
An IRS audit is a detailed examination of your tax return and financial records to ensure accuracy. It can involve initial correspondence, requests for additional documentation, and potential in-person interviews.
The IRS may scrutinize receipts, bank statements, and other evidence to support the information on your tax return. It’s crucial to be well-prepared and to consider hiring a tax professional to navigate the complexities and ensure your rights are protected
2. How can I reduce or eliminate IRS penalties?
IRS penalties can often be reduced or eliminated through various methods, such as demonstrating reasonable cause, seeking penalty abatement, or entering into an Offer in Compromise (OIC).
Providing evidence of circumstances beyond your control, such as a natural disaster or serious illness, can support a request for penalty relief. Consulting with a tax professional can help you understand your options and effectively negotiate with the IRS .
3. What is an Offer in Compromise (OIC)?
An OIC is an agreement between a taxpayer and the IRS to settle tax debt for less than the full amount owed. To qualify, you must demonstrate that you are unable to pay the full tax liability or that paying it would create financial hardship.
The IRS considers your income, expenses, asset equity, and ability to pay when evaluating an OIC application. A tax professional can help you prepare and submit a compelling OIC proposal.
4. How do I respond to an IRS notice?
Responding to an IRS notice promptly and accurately is crucial. The notice will detail the specific issues or discrepancies found in your tax return. You should gather the requested documentation and respond within the specified timeframe.
If the notice involves a complex issue or if you disagree with the IRS’s findings, consulting with a tax professional can ensure your response is thorough and effectively addresses the IRS’s concerns.
5. Can the IRS garnish my wages or seize my assets?
Yes, the IRS has the authority to garnish wages, levy bank accounts, and seize assets to collect unpaid taxes. If you receive a notice of intent to levy, it’s important to act quickly to resolve the issue.
Options include negotiating a payment plan, seeking an OIC, or proving financial hardship. Professional representation can help protect your assets and negotiate favorable terms with the IRS.
6. What is Innocent Spouse Relief?
Innocent Spouse Relief provides relief from joint tax liability if your spouse (or former spouse) improperly reported or omitted items on your tax return without your knowledge.
To qualify, you must prove that you were unaware of the errors and that it would be unfair to hold you responsible. A tax professional can assist in preparing the necessary documentation to support your claim.
7. How can I stop wage garnishments and tax levies?
To stop wage garnishments and tax levies, you must address the underlying tax debt. Options include entering into an installment agreement, submitting an OIC, or requesting Currently Not Collectible (CNC) status if you are unable to pay due to financial hardship.
Professional representation can negotiate with the IRS on your behalf to halt collection actions and find a manageable resolution.
8. What documents do I need for an IRS audit?
For an IRS audit, you need to provide comprehensive documentation supporting your tax return. This includes income statements, receipts for deductions and credits, bank statements, and records of major financial transactions.
Keeping organized records throughout the year can make the audit process smoother. A tax professional can help ensure you have all the necessary documentation and present it effectively to the IRS.
9. What are the different types of IRS audits?
Effective tax planning requires meticulous record-keeping. Essential documents include income statements, expense receipts, investment records, and any documents related to deductions and credits. Keeping organized records ensures that you can substantiate your claims if audited and helps in accurately preparing your tax returns.
Additionally, maintaining records of any major financial transactions, such as the sale of property or investments, is crucial. These documents provide the necessary information to calculate capital gains or losses and ensure that you report all taxable events accurately. Regularly updating and reviewing your financial records with your CPA can streamline the tax planning process.
10. How can I prepare for an IRS audit?
Preparing for an IRS audit involves gathering all relevant financial documents, understanding the focus of the audit, and organizing your records.
Conducting a self-audit can help identify potential issues before the IRS does. Consulting with a tax professional can provide guidance on how to present your case and what to expect during the audit process.
11. What is Currently Not Collectible (CNC) status?
CNC status indicates that you are unable to pay your tax debt due to financial hardship. While in CNC status, the IRS temporarily suspends collection activities, such as wage garnishments and levies. However, interest and penalties continue to accrue.
To obtain CNC status, you must provide detailed financial information proving your inability to pay. Professional representation can help you navigate the application process.
12. How can I negotiate a payment plan with the IRS?
Negotiating a payment plan, or installment agreement, with the IRS allows you to pay your tax debt over time. To set up a plan, you need to submit an application and provide financial information.
The IRS offers various types of installment agreements, depending on the amount owed and your financial situation. A tax professional can help you determine the best option and negotiate favorable terms .
13. What should I do if I have unfiled tax returns?
If you have unfiled tax returns, it’s important to address the issue promptly to avoid penalties and interest. Gather your financial records, file the missing returns, and consult with a tax professional to ensure accuracy and compliance.
If you owe back taxes, options like installment agreements or OICs can help manage the debt. Professional guidance can help you navigate the process and mitigate potential penalties.
14. How do I handle a Notice of Federal Tax Lien (NFTL)?
A Notice of Federal Tax Lien (NFTL) indicates that the IRS has a legal claim against your property due to unpaid taxes. To resolve an NFTL, you must pay the tax debt in full, enter into a payment plan, or negotiate an OIC.
In some cases, you may qualify for lien withdrawal or subordination. A tax professional can help you understand your options and negotiate with the IRS to resolve the lien.
15. What are the benefits of hiring a tax attorney or CPA for IRS representation?
Hiring a tax attorney or CPA for IRS representation provides expert guidance and negotiation skills to resolve your tax issues. These professionals understand IRS procedures and can effectively communicate on your behalf.
They can help reduce penalties, negotiate payment plans, and provide peace of mind by ensuring that your rights are protected and your case is handled with the utmost professionalism.
16. What is the statute of limitations for the IRS to audit my tax return?
The IRS generally has three years from the date you file your tax return to audit it. However, if you omit more than 25% of your gross income, this period extends to six years.
There is no statute of limitations if you file a fraudulent return or fail to file altogether. Knowing these timelines is crucial for maintaining proper records and being prepared for potential audits. Professional tax advisors can help you understand and comply with these requirements.
17. How can I protect myself from tax fraud and identity theft?
Tax fraud and identity theft are serious concerns. To protect yourself, ensure you keep your Social Security number and other sensitive information secure. Regularly monitor your financial accounts and credit reports for any suspicious activity.
If you suspect that your identity has been stolen, report it to the IRS immediately. The IRS provides resources and assistance for victims of tax-related identity theft, and working with a tax professional can help safeguard your personal information.
18. What is a tax lien, and how can it affect my credit?
A tax lien is a legal claim by the government against your property due to unpaid tax debt. It can affect your credit score and make it difficult to obtain loans or credit.
To remove a tax lien, you must pay your tax debt in full or negotiate a payment plan with the IRS. In some cases, you may qualify for a lien withdrawal or subordination, which can minimize the impact on your credit. Consulting with a tax professional can help you navigate the process and protect your financial reputation .
19. What should I do if I receive an IRS audit notice?
If you receive an IRS audit notice, don’t panic. Carefully read the notice to understand what information the IRS is requesting. Gather all relevant documentation and consider consulting with a tax professional to help you prepare and respond.
A professional can guide you through the audit process, ensure you provide accurate information, and represent you in communications with the IRS. Prompt and thorough responses can help resolve the audit efficiently and favorably.
20. How does an IRS audit affect my future tax filings?
An IRS audit can have implications for your future tax filings. If the audit reveals errors or discrepancies, you may need to amend previous returns and ensure accuracy in future filings. The IRS may also impose penalties or interest on unpaid taxes.
To avoid future issues, consider working with a tax professional to review and correct any identified errors, stay compliant with tax laws, and develop strategies to minimize your tax liability moving forward.
21. What should I do if I can't pay my tax bill in full?
If you can’t pay your tax bill in full, it’s important to address the issue promptly to avoid penalties and interest. The IRS offers several options, such as setting up an installment agreement to pay the debt over time, applying for an Offer in Compromise to settle the debt for less than the full amount, or requesting Currently Not Collectible (CNC) status if you are facing financial hardship.
Consulting with a tax professional can help you determine the best course of action based on your financial situation and ensure that you comply with IRS requirements.
22. How can I ensure my tax preparer is qualified and trustworthy?
Ensuring your tax preparer is qualified and trustworthy involves checking their credentials and background. Look for preparers with recognized certifications such as CPA (Certified Public Accountant), EA (Enrolled Agent), or tax attorneys with a specialization in tax law.
Verify their standing with professional organizations, read reviews, and ask for references. Additionally, ensure they have a Preparer Tax Identification Number (PTIN) issued by the IRS. Working with a reputable tax professional can provide peace of mind and ensure your taxes are handled accurately.
23. What is the role of an enrolled agent (EA) in IRS representation?
An enrolled agent (EA) is a tax professional authorized by the U.S. Department of the Treasury to represent taxpayers before the IRS. EAs are skilled in all areas of taxation and can assist with audits, collections, and appeals.
They must pass a comprehensive exam covering tax law and continue their education to maintain their credentials. EAs can provide valuable assistance in negotiating with the IRS, preparing tax returns, and ensuring compliance with tax laws.
24. How does bankruptcy affect my tax liabilities?
Filing for bankruptcy can affect your tax liabilities in several ways. Some tax debts may be discharged in bankruptcy, depending on the type of bankruptcy filed and the nature of the tax debt.
For instance, income tax debts may be discharged if they meet specific criteria, such as being at least three years old and having been assessed at least 240 days before the bankruptcy filing.
However, other taxes, like payroll taxes, typically cannot be discharged. Consulting with a tax professional and a bankruptcy attorney can help you understand the impact of bankruptcy on your tax liabilities and explore the best options for your situation.