1. Q: Can you guarantee me that you can settle my outstanding tax debt for 'pennies on the dollar?'
A: I do not know for what amount I can settle your tax debt until I fully evaluate the specific facts of your case and your financial circumstances. The IRS on October 25, 2004 issued a consumer alert that advised taxpayers to beware of promoter’s claims that tax debts can be settled for pennies on the dollar through the Offer in Compromise Program. The purpose of my free 15-minute consultation is to get an idea of the nature of your tax problem and determine how I can help you. After I understand your case, I will be better able to tell you what I can do to help you.
2. Q: Can you get the IRS to release the garnishment on my wages?
A: Yes. But to do so, I will need to get certain financial information from you to explore the options for resolving your tax debt other than garnishment of wages that the IRS will accept.
3. Q: Can I get a garnishment released before my next payday?
A: Yes, it is possible. We must act quickly to contact IRS with financial information about you and a clear plan for resolving your tax debt without garnishment. With complete financial information, IRS can within 1 – 2 business days fax a release of garnishment to your payroll department. Be sure to have a specific contact person in your payroll department, as well as their fax and telephone numbers when you contact me.
4. Q: The IRS levied my bank account, and I am expecting a deposit in a few days. Can you help me get the levy released? Will the bank send to IRS the money deposited after the levy?
A: Yes, I can help; however, by law, your bank can hold the funds in your account at the time of the levy for 21 days. The levy reaches only those funds in your account at the time of the levy. Thus, amounts deposited in your account after the levy will not be paid over to IRS. Within the 21 days that the bank by law is allowed to hold the funds in your account for IRS, we can work to get the levy released by formulating a plan acceptable to IRS to resolve your outstanding tax debt.
5. Q: Can you get the IRS to release the lien it has filed against me?
A: The IRS is required to release a lien filed against you in certain circumstances; however if a full payment or a bond for the tax is not offered to IRS, getting a lien released can be difficult. Based upon certain facts and circumstances, however, the law does permit the IRS to release its lien even though the lien is still enforceable and has not been paid in full. We can examine your particular facts and circumstances to determine whether it would be worthwhile to seek a release of lien in this situation.
6. Q: I am trying to purchase a home, but cannot get a loan because IRS has filed a Notice of Federal Tax Lien against me. Can you help?
A: The IRS often will allow your mortgage lender to have a first lien on the property you want to purchase even though IRS has previously filed a lien against you. To achieve this purpose, we will seek a Certificate of Subordination from the IRS. Most lenders will agree to lend you money to purchase your home with this Certificate of Subordination.
7. Q: I received a Statutory Notice of Deficiency from IRS. Can you help me if I do not live in Washington, D.C.?
A: Yes. To respond to the Statutory Notice of Deficiency, our firm will:
1) File a Petition in the United States Tax Court in Washington, D.C., where we will challenge the amount of tax IRS says you owe.
2) File an Entry of Appearance with the Tax Court indicating that we are representing you in the case.
3) Designate Washington, D.C. as the place of trial. This is a document that lets the Tax Court and IRS know that if your case goes to trial, the trial would be held in Washington, D.C. We will try our utmost, however, to settle your case without a trial. If your case does go to trial, you will be required to travel to Washington, D.C.
8. Q: What does your fee include, and will it change during the course of your representation of me?
A: Our representation includes coordinating with you the gathering of all documents and completion of forms required to be filed with the IRS to accomplish the objective you agree to have us pursue. It is very important for you to cooperate and participate fully in gathering this information and forwarding it to us as soon as possible. Once we have all of the required documents and forms, our representation includes initial negotiations with IRS on your behalf, a request for reconsideration of any initial adverse decision by IRS, and, if you decide to further appeal a further adverse decision, one administrative appeal before the IRS Office of Appeals. Our fee for these services will not change during the course of our representation. We will advise you of the fee to provide this representation before we begin working for you.
9. Q: In addition to IRS, I also owe state taxes. Can you help me with my state tax debt?
A: Often, we can assist with resolving state tax debts. We are licensed to practice law in the District of Columbia. Maryland and Virginia, however, also recognize our representation of taxpayers in their states. Whether we can represent you in your state simply depends on whether your state will accept our representation.
10. Q: If I hire you to resolve my federal tax problem, will it cost more for you to represent me in resolving my state tax debt?
A: Often, much of the information that we obtain for resolving your federal tax debt can be helpful in resolving your state tax debt, provided your state will accept our Representation, and further provided that you are trying to accomplish the same objective at the federal and state levels. For these reasons, the fee will probably be higher to represent you before the IRS and your state tax agency, but it should not be very much higher. We can give you an exact fee for both your federal and state tax cases once we know your particular facts and circumstances and whether your state will accept our representation.
11. Q: When is the IRS required to issue a Lien Release?
A: The IRS is required to issue a release of the Notice of Federal Tax Lien within 30 days after the taxpayer satisfies the tax due (including all penalties and interest) or within 30 days after IRS accepts the taxpayer’s bond guaranteeing payment of the debt. Also, the IRS must release a lien within 30 days after the tax debt becomes unenforceable, depending on the statute of limitations on collection. All requests for release of lien should be in writing.
12. Q: Does the IRS ever allow another debt to take priority over the IRS’s lien?
A: Yes. A lien subordination is the IRS’s agreement to permit another lien (e.g., mortgage or other security interest) to take priority over the IRS’s lien. (The IRS simply agrees to allow another debt secured by the taxpayer’s property to be paid before the tax covered by the IRS’s lien when, otherwise, the IRS would have a legal right to collect the tax covered by its lien first.) The typical situation for lien subordination is the purchase of a home when the IRS has already filed a lien against the taxpayer. A lender is not likely to provide the taxpayer a mortgage loan unless the lender’s security for the loan (e.g., mortgage or deed of trust) is placed ahead of the IRS. Generally, the IRS may subordinate its lien if subordination is determined to increase the amount the United States may realize or the collection of the tax liability will be easier. Also, IRS may subordinate its lien if the taxpayer pays an amount equal to the interest to which subordination is requested.
13. Q: What happens when the IRS files a lien against the wrong person?
A: The IRS will issue a Certificate of Nonattachment of the Federal Tax Lien when shown proof that a Notice of Federal Tax Lien was filed against the wrong person.
14. Q: Under what circumstances will the IRS withdraw a lien?
A: Yes. The IRS has the authority to withdraw a Notice of Federal Tax Lien against the taxpayer when IRS has prematurely filed the Notice or otherwise filed the Notice not in accordance with administrative procedures and when it will facilitate your payment of the tax, as when removal of the lien allows additional credit to pay the tax. Also, the IRS may withdraw a notice for any reason considered to be in the best interests of the government. Withdrawal of the Notice is not mandatory.
15. Q: Under what circumstances can IRS collection actions or offers in compromise be appealed?
A: IRS collection actions, such as IRS’s filing of a federal tax lien and/or notice of levy can be appealed within the IRS Office of Appeals in Collection Due Process Hearings. Offer in compromise appeals are determined by the overall reasonableness of your offer and also by the manner in which the IRS calculated your tax. (Often the IRS personnel in Appeals are more experienced and have greater authority to resolve cases.)
16. Q: What is the best way to contact you?
A: Whether you contact me by telephone (toll free for outside the Washington, D.C. metropolitan area), fax or email, I will respond no later than 24 hours after I receive your communication. Clients have said that they have found it helpful to write a short narrative identifying their problem, the tax years involved and the taxes, penalties, and interest owed for each year, and having before them the most recent correspondence from IRS before they contact me. I find it helpful, too. The quicker we can focus on the particular facts of your case, the quicker we can devise a solution.