Question 1

Will the IRS take my home?

Accepted Answer

This is a common misconception many of my clients have. The IRS and some tax representation companies are equally guilty in fear mongering taxpayers. The reality is that this is a very uncommon practice of the IRS. The few cases where I have seen the IRS take this action have been where the taxpayer took a tax protestor stance with regards to their tax obligations. It is so important to have an attorney by your side so you don't fall for these fear mongering tactics employed by some in the IRS. While the IRS has the power to take your home, this can normally be avoided.

Question 2

What is the difference between a Revenue Agent and a Revenue Officer?

Accepted Answer

Both work for the IRS, but they have very different responsibilities. Revenue agents are generally tasked with conducting audits (or examinations). Revenue Officers' primary responsibility is to collect past due taxes and get taxpayers to file past due tax returns. Both have the ability to summons information in order to complete their job.

Question 3

What is an IRS summons?

Accepted Answer

A summons is commonly used by revenue agents and officers alike to force a meeting with the taxpayer and to review pertinent documents to do their job. 26 U.S.C. S 7602 provides the IRS with the power to examine books and records and to interview the person responsible for the data and underlying tax liability. The IRS is allowed to do this provided they are acting in good faith (this is a very slight burden to prove). A heavy burden then turns on the taxpayer to show abuse of process in order to prevent the enforcement of a summons.

Question 4

What is the difference between a lien and a levy?

Accepted Answer

For purposes of the IRS, a lien is not the taking of property, but simply a public filing which makes other creditors aware that the government has a legal right to your property. The lien protects the government's interest in all your property. A levy, on the other hand, is when the IRS actually takes property. This can come in the form of wage garnishments, bank levies, and seizing of property.

Question 5

What is the difference between a tax law firm and a tax representation company?

Accepted Answer

A law firm is owned by lawyer(s) and operates under the rules as set out by the state bar of where the law firm resides. This binds the law firm to ethical practices as set out in the rules of professional conduct. A tax representation company operates in a gray area. Tax representation companies will normally make it clear to you that they are not a law or CPA firm in order to get around the state's rules of professional conduct for CPAs and attorneys. While both will be able to represent you before the IRS, only a law firm must abide by the rules of professional conduct. This statement should be carefully considered because a simple Google search will pull up a number of problems taxpayers have had with tax representation companies.

Question 6

How long will it take for my Offer in Compromise?

Accepted Answer

This depends on a number of factors (amount of the tax liability, documentation needed, and whether an appeal is necessary). In many cases, an offer can be prepared and reviewed by the IRS within 7 months. This can take longer if an appeal is necessary.

Question 7

I have been told by another company that they can settle my tax debt for little to nothing?

Accepted Answer

While this may be possible, I would think long and hard about going with a company that is making big promises with little to no information about your case. You may have been talking to a salesperson, and not the person who is actually going to do the work. Only after a careful review of your case can a determination be made on your settlement potential.

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