IRS Liens. IRS Levy. Tax Consultant. Offer in Compromise Tax Help How does the IRS “know” that a taxpayer “should” file a return? By law, many entities must report the income they pay to individuals. A 1099 MISC/DIV/INT/B or a K-1 are just some of the income reporting documents that are filed directly with the… Read More

If you request an extension of time to file by the tax deadline and you paid at least 90 percent of your actual tax liability by the original due date, you will not face a failure-to-pay penalty if the remaining balance is paid by the extended due date. If both the failure-to-file penalty and the… Read More

Failure to File or Pay Penalties: Eight Facts IRS Tax Tip 2012-74, April 17, 2012 The number of electronic filing and payment options increases every year, which helps reduce your burden and also improves the timeliness and accuracy of tax returns. When it comes to filing your tax return, however, the law provides that the… Read More

I used to joke that since interest is calculated daily, wouldn’t the IRS computer burn out at 12:01 am…just based on attempting to calculate the client’s new balances? The concept of the assessed balance avoids this potential daily burn-out. All the IRS computer needs to remember is the benchmark of the assessed balance on each… Read More

Looking back to our $10,000 tax assessment, the interest is 4% or $1.10/day and the penalty is $50/month. If it logically takes the IRS computer time to process and mail out a bill, easily fifty days has passed. Let’s not forget the failure to estimate penalty (call it $820 for this example). The first bill… Read More

The assessment of tax is part of what we are told is the “assessed balance”. As we know, the IRS charges penalty and interest (P&I). Currently (and reviewed quarterly) the IRS interest rate for underpayments is 4%, compounded upon itself, accrued daily. That is not so bad, I wish that I had credit cards at… Read More

This 23c date is the assessment date; the legal date that sets in motion the ten-year Collection Statute Expiration Date (CSED). This also starts the Collection Process. This notion of the assessment starting the CSED clock is important to teach you at this level as it sets the stage for later discussions. Congress did not… Read More

Objective To understand the importance and definition of the Assessment of a tax liability and the statutory periods of collection and expiration. To understand the differences between Assessment, Collection and Refund Statutory Expiration Dates. To understand the relationship of penalties and interest with the assessment periods. To understand the relationship between Liens and Levies in… Read More

Of course, there is no fun in only having clients that only have refunds, you would not be here, thirsty for knowledge. Let’s work through what happens when the best laid plans of mice and men do not equal a happy refund taxpayer. You produce a 1040 for a MFJ married couple that results in… Read More

Let’s start with the fundamental part of our careers, the assessment. The assessment (or “bill”) starts everything in Collections. The assessment has its own life, an entire set of Internal Revenue Code (IRC) and is misunderstood by many people. Your knowledge in the preparation of a tax return, all the CE, all the interactions with… Read More