If you are seeking face-to-face tax help, the IRS has Taxpayer Assistance Centers (TACs) located across the country. Note that TACs are closed on federal holidays and generally operate on a first-come, first-served basis. Visit “Contact Your Local Office” on the IRS website to find the addresses and phone numbers of TACs in your state.
If you want to check the status of your Federal tax refund, you can do it online, by telephone, or even with a smartphone application.
The IRS provides a “Where’s My Refund?” online tool that tracks your tax refund by providing 3 simple alerts: Tax Return Received, Tax Refund Approved, and Tax Refund Sent. To use this online tool, visit the IRS’s Tax Refund Center. Note that you will need to enter your personal information – including your Social Security Number (SSN), filing status, and tax refund amount (in exact whole dollars).
To check the status of your refund by telephone, call the IRS Refund Hotline at 1-800-829-1954.
To check the status of your refund using a smartphone, download the “IRS2GO” application from the app store. This will allow you to communicate with the IRS and request your refund status using your mobile device.
Question: I received a Notice of Federal Tax Lien via certified mail for unpaid back taxes and I’m scared and don’t know what to do. Can you help?
Answer: Yes. A Notice of Federal Tax Lien (NFTL) is public record and is generally filed with the County Recorder where you reside. A federal tax lien will also negatively impact your credit report scores. It is notice to all your other creditors that the IRS has a secured interest in all your real and personal property you have now and acquired in the future.
A federal tax lien will make it very difficult, if not impossible, for you to purchase a home, vehicle and other property on credit. It may also prevent you from accessing the equity in real property you may have built up over the years.
However, the IRS has several different solutions that can resolve your NFTL if you qualify. You can resolve a federal tax lien by paying it in full or if that is not an option you can find out if you qualify for a “Release of Lien”, a “Lien Subordination”, a Lien Discharge” or “Lien Withdrawal”.
It is important to keep in mind that IRS problems didn’t just happen overnight and will take some time to resolve. The good news is that generally you won’t have to meet or even speak with the IRS while we’re retained.
It’s important to consult with a tax resolution professional to see which Lien relief solutions you may be eligible for before the IRS starts enforcing aggressive collection action against you. We can help protect what you have and preserve your rights!!
Do you have an issue with the IRS and cannot find the right phone number? See the list of IRS hotlines below:
- Tax Help Line for Individuals: 800-829-1040
- Tax Help Line for Businesses: 800-829-4933
- Order Tax Forms and Publications: 800-829-3676
- Information Return Reporting: 866-455-7438
- Employer Identification Numbers (EINs): 800-829-4933
- Help Line for Tax Exempt and Government Entities (TEGE): 877-829-5500
- Help Line for Forms 706 and 709: 866-699-4083
- Help Line for Excise Tax and Form 2290: 866-699-4096
- Help Line for FBAR and Title 31: 866-270-0733
- Special Hotline for U.S. Military (Disaster or Combat Zone): 866-562-5227
- Telephone Assistance for Overseas Taxpayers: 267-941-1000 (not toll-free)
- Telephone Assistance for the Deaf (TDD): 800-829-4059
For more phone numbers, please see “Telephone Assistance.”
Keep in mind, the IRS is understaffed so expect long hold times. The best time to call is early in the morning.
A Lakewood, OH resident, Thomas Klocker was sentenced to six months in prison and ordered to pay nearly $1.8 million in restitution to the IRS for claiming false write-offs and not declaring income. Kloker diverted funds from his metal sales business for his personal use to purchase a waterfront residence, maintain his luxury yacht and take vacations. He also misrepresented personal expenses by falsely reporting them as business expenses.
Although this took place in 2007, it remains to date the largest amount owed in back taxes.
Telecommunications mogul Walter Anderson was sentenced in 2007 for failing to pay a whopping $200 million in taxes to the IRS. Although in 1996 he earned over $126 million, his federal return showed only $67,939 in income and he paid $495 in taxes.
He avoided paying taxes on earnings of $365 million by using shell companies, aliases, offshore tax havens and secret drop boxes. One of the shell companies was the Smaller World Foundation, where Anderson hid hundreds of millions of dollars. He claimed that he planned to use the Foundation’s money to promote world peace, family planning and space exploration.
During his sentencing hearing, friends, relatives and business associates testified that “he was a caring man who just made the mistake of trying to avoid paying his fair share of taxes, and wasn’t motivated by personal greed or the pursuit of luxury.”
Anderson was sentenced to nine years in federal prison, but a federal judge ruled that because prosecutors botched the plea deal, Anderson did not have to back the $200 million to the IRS.
A resident of Germantown, TN, Larry Thornton was sentenced to one year in prison and ordered to pay more than $10 million in restitution for failing to pay more than $8 million in employment taxes.
Thornton owned 2 companies, First Touch Payment Solutions, a credit card processing company and Software Earnings, Inc. (SEI) which produced and installed check processing.
Beginning in 2007, Thornton stopped paying the taxes withheld from his employees paychecks at SEI and failed to file Forms 941, the Employer’s Quarterly Federal Tax Returns, and did the same in 2010 to his First Touch employee’s taxes. During that time, he collected more than $6.8 million and also did not pay the employer’s matching share of FICA taxes. He also failed to file personal and corporate tax returns.
Thornton spent the money instead on personal expenses, including house and condominium payments, vehicle, yacht and motorcycle loan payments, personal travel, and start-up funding for his wife’s beauty boutique.
Deputy District Attorney General Caroline Ciralo said, “Payment of employment taxes is not optional. The sentence that Mr. Thornton received today reflects not just the harm that his actions caused to the U.S. Treasury but also the financial risks he place on his employees by deliberately not filing their W-2 forms with Social Security.”
The IRS is now prosecuting Payroll cases more aggressively than they had in the past. Contact our Attorneys for a confidential consultation if you have a payroll tax issue.
Billy Floyd, of Monroe, NC was indicted on charges of interfering with the due administration of the Internal Revenue laws and filing false tax returns.
It was alleged that Floyd filed amended tax returns for the years 2000-2002 showing his tax liability reduced to zero. In 2010 he again filed amended returns but included the tax year 2003, all reduced to zero.
The returns were not accepted by the IRS and Floyd was required to pay his tax liabilities. Floyd submitted fake “Surety Bonds” to the IRS in the amount of $500,000. Although Surety Bonds are real, they are not accepted as a legal way to pay taxes.
Floyd then filed a civil suit against the IRS claiming that income tax is illegal. The case was dismissed by the court.
During that time, the IRS seized Floyd’s property. At the public sale of the property, Floyd told potential buyers that the sale was illegal and they would not receive clear title. He also threatened to sue anyone who purchased the property. The property was not sold at the auction, so in another attempt to stop another pending sale, Floyd filed bogus liens on the property.
Floyd’s trial is pending, but he faces a statutory maximum of 3 years in prison for each of the 6 counts of the indictment plus monetary penalties.
Saul Hyatt, from Weston CT., pleaded guilty to one count of concealing over $1.5 million in income by using an undeclared bank account in Panama.
Hyatt registered a Panamanian Corporation, The Centennial Group, which bought and sold duty-free alcohol and tobacco products. Both products were shipped to warehouses in the US and the profits, totaling $1,627,832 were wired to the account in Panama. Hyatt used some of the money to buy a Mercedes Benz SL 550R and pay for $19,000 in interior design and goods.
Federal law requires individuals to report any financial interest and account information and list the country the account is located in. All income earned from foreign financial accounts that have a value of more than $10,000 must file with the Department of Treasury a Report of Foreign Bank and Financial Accounts (FBAR). Sentencing is scheduled for Jan. 6, 2017, where Hyatt faces a statutory maximum sentence of 5 years in prison. He has agreed to file true and accurate tax returns to pay the IRS all taxes and penalties owed. He will also pay a penalty for failure to disclose his foreign accounts in the amount of $854,465.
Contact our Attorneys today if you have a Foreign Bank Account.
Here are some of the most important, according to AccountingToday, 2016 tax-planning considerations for individuals:
- Accelerate Deductions and Defer Income: It sometimes makes sense to accelerate deductions and defer income. There are plenty of income items and expenses you may be able to control. Consider deferring bonuses, consulting income or self-employment income. On the deduction side, you may be able to accelerate state and local income taxes, interest payments and real estate taxes.
- Bunch Itemized Deductions: Many expenses can be deducted only if they exceed a certain percentage of your adjusted gross income (AGI). Bunching itemized deductible expenses into one year can help you exceed these AGI floors. Consider scheduling your costly non-urgent medical procedures in a single year to exceed the 10 percent AGI floor for medical expenses (7.5 percent for taxpayers age 65 and older). This may mean moving a procedure into this year or postponing it until next year. To exceed the 2 percent AGI floor for miscellaneous expenses, bunch professional fees like legal advice and tax planning, as well as unreimbursed business expenses such as travel and vehicle costs.
- Make Up a Tax Shortfall with Increased Withholding: Don’t forget that taxes are due throughout the year. Check your withholding and estimated tax payments now while you have time to fix a problem. If you’re in danger of an underpayment penalty, try to make up the shortfall by increasing withholding on your salary or bonuses. A bigger estimated tax payment can leave you exposed to penalties for previous quarters, while withholding is considered to have been paid ratably throughout the year.
- Leverage Retirement Account Tax Savings: It’s not too late to increase contributions to a retirement account. Traditional retirement accounts like a 401(k) or individual retirement accounts (IRAs) still offer some of the best tax savings. Contributions reduce taxable income at the time that you make them, and you don’t pay taxes until you take the money out at retirement. The 2016 contribution limits are $18,000 for a 401(k) and $5,500 for an IRA (not including catch-up contributions for those 50 years of age and older).
- Reconsider a Roth IRA Rollover: It has become very popular in recent years to convert a traditional IRA into a Roth IRA. This type of rollover allows you to pay tax on the conversion in exchange for no taxes in the future (if withdrawals are made properly). If you converted your account this year, reexamine the rollover. If the value went down, you have until your extended filing deadline to reverse the conversion. That way, you may be able to perform a conversion later and pay less tax.
- Get Your Charitable House in Order: If you plan on giving to charity before the end of the year, remember that a cash contribution must be documented to be deductible. If you claim a charitable deduction of more than $500 in donated property, you must attach Form 8283. If you are claiming a deduction of $250 or more for a car donation, you will need a contemporaneous written acknowledgement from the charity that includes a description of the car. Remember, you cannot deduct donations to individuals, social clubs, political groups or foreign organizations.
- Give Directly from an IRA: Congress finally made permanent a provision that allow taxpayers 70½ and older to make tax-free charitable distributions from IRAs. Using your IRA distributions for charitable giving could save you more than taking a charitable deduction on a normal gift. That’s because these IRA distributions for charitable giving won’t be included in income at all, lowering your AGI. You’ll see the difference in many AGI-based computations where the below-the-line deduction for charitable giving doesn’t have any effect. Even better, the distribution to charity will still count toward the satisfaction of your minimum required distribution for the year.
- Zero out AMT: Some high-income taxpayers must pay the alternative minimum tax (AMT) because the AMT removes key deductions. The silver lining is that the top AMT tax rate is only 28 percent. So you can “zero out” the AMT by accelerating income into the AMT year until the tax you calculate for regular tax and AMT are the same. Although you will have paid tax sooner, you will have paid at an effective tax rate less than the top regular tax rate of 39.6 percent. But be careful, this can backfire if you are in the AMT phase-out range or the additional income affects other tax benefits.
- Don’t Squander Your Gift Tax Exclusion: You can give up to $14,000 to as many people as you wish in 2016, free of gift or estate tax. You get a new annual gift tax exclusion every year, so don’t let it go to waste. You and your spouse can use your exemptions together to give up to $28,000 per beneficiary.
- Leverage Historically Low Interest Rates: Many estate and gift tax strategies hinge on the ability of assets to appreciate faster than the interest rates prescribed by the IRS. An appreciating market and historically low rates create the perfect atmosphere for estate planning. The past several years presented a historically favorable time, and the low rates won’t last forever.