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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
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Experience:  15years with H & R Block. Divisional leader, Instructor
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In 2010, I sold my home in Brooklyns Park Slope area for approximately

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In 2010, I sold my home in Brooklyn's Park Slope area for approximately $750K. I had brought this house approximately 22 years ago for about $99K. I never lived in the house, but rented out 2 apartments, to my niece and sister for very little rent. In 2007, I decided to renovate the house, which I did so that I could rent the 2nd floor for income. Unfortunately, the entire rental of the apartment went to pay the mortgages that I had taken for the reparations. My sister who was ill remained living there and I charged her only $300 per month for rent, which she paid intermittently. In 2010 she was diagnosed with cancer, and the tenant who was paying for the mortgage moved out. I made the decision to sell the house. In 2/11, I sold the house for $799.00, and from that money I paid the mortgage and brought an apartment for my sister. I was now debt free. I don't recall being told by my attorney that I would have to pay a capital gain. I live in a Mitchell Lama apartment, I'm 70 years old, I've returned to work, my yearly income is approximately $100K with pension/ss and my salary. I went to my accountant who had gotten me an extension on my taxes yesterday and he told me i would have to pay $600,000 in taxes, which of course is impossible. My question is should I consult a tax lawyer and have them accompany me to the IRS to be put on a payment plan. or should i meet with them without a lawyer and would I be eligible for an offer in compromise. Is it also possible to offer them the apartment that I brought for my sister which for $110K. She passed away in November 2011, and my nephew is living there. Please advise.
Submitted: 2 years ago.
Category: Tax
Expert:  Robin D. replied 2 years ago.

Robin D :

Hello and thank you for using Just Answer,
You cannot offer the other apartment in exchange for the tax debt. The IRS could seize the property and sale it, but they only do that is they feel the sale would result in the tax debt being paid. If you sale the apartment to help with the debt, please know that the sale will result in a tax reporting requirement also.
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. The IRS generally approves an offer in compromise when the amount offered represents the most they can expect to collect within a reasonable period of time.
An installment agreement allows you to make a series of monthly payments over time. The IRS will not accept an Offer In Compromise unless all other options for payment have be tried, thi sinclude setting up a payment plan.
You may contact the IRS by phone or in person, or you may submit Form 9465 , Installment Agreement Request, through the mail. You do not need a tax professional to do this.
If you decide to pursue an offer in compromise, I suggest you look to using a tax professional (an attorney is not required) that you trust and have a relationship with. The forms are many and can be complicated.

Customer:
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7525
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and 8 other Tax Specialists are ready to help you
Expert:  Robin D. replied 2 years ago.
Our chat has ended, but you can still continue to ask me questions here until you are satisfied with your answer. Come back to this page to view our conversation and any other new information.

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Expert:  Robin D. replied 2 years ago.

Hello again,

The system advised that you responded but nothing came through. If you had a response please repost. Here is a copy of my post to you:
Robin D :

Hello and thank you for using Just Answer,
You cannot offer the other apartment in exchange for the tax debt. The IRS could seize the property and sale it, but they only do that is they feel the sale would result in the tax debt being paid. If you sale the apartment to help with the debt, please know that the sale will result in a tax reporting requirement also.
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. The IRS generally approves an offer in compromise when the amount offered represents the most they can expect to collect within a reasonable period of time.
An installment agreement allows you to make a series of monthly payments over time. The IRS will not accept an Offer In Compromise unless all other options for payment have been tried, this includes setting up a payment plan.
You may contact the IRS by phone or in person, or you may submit Form 9465 , Installment Agreement Request, through the mail. You do not need a tax professional to do this.
If you decide to pursue an offer in compromise, I suggest you look to using a tax professional (an attorney is not required) that you trust and have a relationship with. The forms are many and can be complicated.

Customer:
Customer: replied 2 years ago.
Robin - very satisfied with your response - I just paid you the fee. I may check with you again.
Expert:  Robin D. replied 2 years ago.
Yes, please come back any time you have a tax question. You can request my assistance. Best wishes

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