Eliminating Tax Penalties Due to Reasonable Cause

If you have made a mistake on your tax return that is later discovered by the IRS, you will be charged interest on the amount you owe. In addition, the IRS has the discretion to assess penalties requiring you to pay extra. But this doesn’t mean that you will have to pay these penalties. Working with a tax lawyer in Los Angeles or elsewhere can help in getting the penalties reduced or even dropped.

About one-third of all IRS penalties are abated and your odds of having your penalties dropped are much higher if you work with a tax attorney on your case. In order to convince the IRS to remove the penalties they have imposed, you need to convince them of special circumstances that lead to “reasonable cause” for you to not have made a correct filing initially.

This goes beyond just admitting that you made an honest mistake. Here are a few of the scenarios that the Law Offices Of Jeffrey B. Kahn, P.C.  know that the IRS will consider to be reasonable cause for an erroneous tax filing:

  • A death or serious illness in the family.
  • Incorrect advice given by an IRS agent in person or over the phone.
  • The loss of records because of a fire or natural disaster.
  • An error made by your tax preparer.

If you feel that you are being unfairly punished for a problem with a tax filing that was beyond your control, your best bet is to contact an IRS attorney from our firm who can review the facts in your case.

An experienced attorney with the Law Offices Of Jeffrey B. Kahn, P.C. may be able to help you get your tax penalties reduced or eliminated. Learn about the circumstances a tax attorney can use to plead your case with the IRS.

Warding Off a Tax Levy with a Payment Plan

If you owe more in taxes than you can afford, you have several options to avoid going into default and incurring a tax lien or levy. One way to avoid protracted tax levy and lien issues with an IRS lawyer is to enter into a payment plan. Working with the Law Offices Of Jeffrey B. Kahn, P.C. is one of the most effective ways to negotiate a payment plan with the IRS that is right for you.

Depending on how much you owe will drive how much verification information/documents that IRS requires to consider a payment plan.  If you owe more than $50,000 in taxes, the IRS will require full verification of your financial information.  Likewise, if you are self-employed, you can expect the IRS to look at your financial information. No matter how much you owe, the IRS will be looking to set up a payment plan that will erase your debt within 60 or 72 months. If you owe more than you can pay within that timeframe, you’ll want to hire in tax lawyer in Fairfield or elsewhere to work on an Offer of Compromise to potentially reduce your debt.

You have a strong chance of having your payment plan accepted if you owe less than $10,000 and meet certain requirements including:

  • Having filed taxes on time for the previous five years while paying in full and not having requested an installation agreement.
  • Showing the IRS that you are unable to pay your tax bill in full.
  • Agreeing to pay your debt within three years.

Working with a tax attorney lawyer is the best way to assure that you get a payment plan that works for your situation and prevents IRS collection action to be taken against you.