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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 4491
Experience:  Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
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my wife and I owe back taxes from her freelance business for

Resolved Question:

my wife and I owe back taxes from her freelance business for each year since 2006 and are too scared to go to anyone for help
Submitted: 1 year ago via LegalInfo.
Category: Tax
Expert:  Lane replied 1 year ago.

NPVAdvisor :

Hi,

NPVAdvisor :

First, I should tell you that, in my 28 years of experience, people ALWAYS do much better when they get to the IRS before the IRS gets to them

Customer:

Hi

Customer:

we just have no ideal how to go forward, we are both in our 50's and know our best earning years are behind us.

NPVAdvisor :

Don't "awfulize" (I'm not making light) it's just that most of the horror stories aren't true, and changes are that if you start putting things together so you can get something to them before they

NPVAdvisor :

a few things:

Customer:

we went to a small tax firm that said they could talk to the irs but they basically did nothing after collecting $2000 from us

NPVAdvisor :

that's atrotious

NPVAdvisor :

(1) was she always profitable? IT profits that are txed, not gross revenue

NPVAdvisor :

(2) Did you know that if you end up owing less than $50,000 in most cases you can set up an installment agreementonline?

Customer:

yes, she is a graphic designer with very little overhead except software and laptop

Customer:

it is more then $50,000 I believe

NPVAdvisor :

OK lets start with bvallparking how much you might owe.... di you file at all?

NPVAdvisor :

ok, there are two things that come to mind intuitively

NPVAdvisor :

(1) an installment plan (you can still submit one, it'll just need t be done with paper)

Customer:

no we were too scare. I work for a company and always paid the most for my w2 but I thought I would draw attention to her if I filed separately

NPVAdvisor :

(2) there is something called an offerncompromise

Customer:

we have $30000 but I believe we own about $85000

NPVAdvisor :

OK take a minute and look at this link: from there: (I'll give you the full link in a minute)

NPVAdvisor :

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. We consider your unique set of facts and circumstances:



  • Ability to pay;

  • Income;

  • Expenses; and

  • Asset equity.


We generally approve an offer in compromise when the amount offered represents the most we can expect to collect within a reasonable period of time. Explore all other payment options before submitting an offer in compromise. The Offer in Compromise program is not for everyone. If you hire a tax professional to help you file an offer, be sure to check his or her qualifications.

NPVAdvisor :

and now see this:

NPVAdvisor :
Like Print

IRS Announces More Flexible Offer-in-Compromise Terms to Help a Greater Number of Struggling Taxpayers Make a Fresh Start

IR-2012-53, May 21, 2012

WASHINGTON — The Internal Revenue Service today announced another expansion of its "Fresh Start" initiative by offering more flexible terms to its Offer in Compromise (OIC) program that will enable some of the most financially distressed taxpayers to clear up their tax problems and in many cases more quickly than in the past.

"This phase of Fresh Start will assist some taxpayers who have faced the most financial hardship in recent years," said IRS Commissioner Doug Shulman. "It is part of our multiyear effort to help taxpayers who are struggling to make ends meet."


Today’s announcement focuses on the financial analysis used to determine which taxpayers qualify for an OIC. This announcement also enables some taxpayers to resolve their tax problems in as little as two years compared to four or five years in the past.


In certain circumstances, the changes announced today include:



  • Revising the calculation for the taxpayer’s future income.

  • Allowing taxpayers to repay their student loans.

  • Allowing taxpayers to pay state and local delinquent taxes.

  • Expanding the Allowable Living Expense allowance category and amount.

Customer:

ok, I do want to ask how do you hire a tax professional we can trust the last one didn't even give us our w4s back when he said he was putting together our back taxes

NPVAdvisor :

first, here's a link to that last one:

Customer:

ok

NPVAdvisor :

You're in Wisconsin?

Customer:

yes

NPVAdvisor :

You really DO have to be careful, as you've learned...

NPVAdvisor :

One of the safes routes to go is to use a Tax attorney

Customer:

yes

NPVAdvisor :

there's a category called EA (Enrolled Agent) and they really are very knowledgable, but that's als where there's been some abuse

NPVAdvisor :

THe IDEAL is a tax attorney, who is CPA and EA ... THese individuals have a lot more to nloe AND the training is just such that there's a descipline there

NPVAdvisor :

sorry for the typo (more to LOSE)

NPVAdvisor :

hang on a sec and let me look at something:

Customer:

ok Thank so much .....we feel like we have been waiting for the ax to fall for the past 8 years

Customer:

and it is hard on our marriage, like we don't deserve to be happy

NPVAdvisor :

First of all ... you are not alone

NPVAdvisor :

secondly, once you take that first step with someone that's competent (and you've already gained some experience there) you'll start to feel the relief

NPVAdvisor :

I will tel you this Don't go with someone who wont give you a fulle picture of what to expect

NPVAdvisor :

and what the range of possibilities are

Customer:

ok

NPVAdvisor :

Nex. I think your best bet is to use fnd -law or the WI BAR listings to look for specialties and o some phone interview.... I think you'll start t see sme patterns emerge

NPVAdvisor :

now,,, juuust a second here

NPVAdvisor :

http://www.attorneys.com/tax/wisconsin/ ... what I'm giving you here is just a starting place... you've been out there for 8 years .... make talking to some of these folks a project ... with an end in mind

Customer:

I will start that search for someone that is a tax lawyer, cpa , and ea.

Customer:

oh Thank you

NPVAdvisor :

just one more, OK?

Customer:

ok

Customer:

Going on this site is the best thing I have done in the past 5 years already

NPVAdvisor :

:)

NPVAdvisor :

Use this one to check on credentials and complaints http://www.wisbar.org/Directories/LawyerSearch/Pages/Lawyer-Search.aspx

Customer:

it is the truth ....fear takes away all happiness

NPVAdvisor :

soo soo true and the shame is there ARE options

Customer:

I will use all 3 links and will research every day to get this moving forward

NPVAdvisor :

you might have to bite the bullet a bit, or given that you have bsomething to work with you mayb e able to make an acceptable offer

Customer:

I can only hope

Customer:

I would be happy to be flat broke but free of this burden

NPVAdvisor :

but start with the interview process as a phase.... AND ... wait to take action until you've met with atleast 4 or five so you can kind of categorize

Customer:

ok

NPVAdvisor :

does NOT have to happen that wsy ... just be proactive

Customer:

I will be from now on

Customer:

now that I have plan and hope

NPVAdvisor :

three weeks emms untiutively right

Customer:

3 weeks? should that be the interview stage

NPVAdvisor :

take that tiem to do as many phone interviews as you can and resist the urge to go with the first one that makes you feel good

Customer:

ok I understand

Customer:

if it sounds to good to be true, it usually is

NPVAdvisor :

art more than science.... but if you haven't hear from them in this amount of time ( AND you can even document if it did pop up that you're looking for help)....

NPVAdvisor :

you'll be better able to pull that trigger and sit down and engage with someone

Customer:

will do

NPVAdvisor :

I DON'T want to give you pie in the sky ... but if you get to them first you're much more in the driver's seat

NPVAdvisor :

I hope this has helpd

Customer:

I know it will be hard but it is a road back

Customer:

You have helped more in 20mins then anyone has helped in 7 years

NPVAdvisor :

.... AND if you want to get back to me just say "For Lane Only" at the beginning of your questions

NPVAdvisor :

THank YOU ... my seratonin levels just sent up

Customer:

Thank you, XXXXX XXXXX

Customer:

bless you sir

NPVAdvisor :

by the way, the links here will stay active... just bookmark and come back here if you want to look at the OIC stiff agains

NPVAdvisor :

THan you so much

NPVAdvisor :

Also, if you want to copy and paste this ... this address will being you right back here: http://www.justanswer.com/tax/7w804-wife-owe-back-taxes-freelance-business.html

Customer:

I am doing so now

Customer:

Thank you again.

NPVAdvisor :

Great ... By the way in another life MANY moons ago, I spent a summer in Madison Beautiful place

NPVAdvisor :

YW

Customer:

it is a beautiful place my wife when to school there

Customer:

I will get started putting a plan together for my search and interviews

NPVAdvisor :

Believe it or not was a musucian years ago marched with the scouts (if that means anything to you)

NPVAdvisor :

very good

NPVAdvisor :

If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better … That's the only way they will pay us here.


HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question.

Customer:

you are excellent

Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 4491
Experience: Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
Lane and 4 other Tax Specialists are ready to help you
Expert:  Lane replied 1 year ago.

Thank you so much for the rating Russ.

GO get 'em.



As a follow-up, this book has helped me and so many others to take an approach to life that brings back the happiness (without the promise of immediate gratification) .. grab a used copy when you can.

I re-read it when I need a refresher

http://www.scribd.com/doc/257928/-Mastery-by-George-Leonard

Thanks again,
God Speed
Lane

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Lane
Lane
JD, MBA, CFP, CRPS
3630 Satisfied Customers
Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986