How Divorce Can Affect Your Taxes

Divorce - Tax Issues
Just as with many other things in life, divorce can also affect your taxes. When it comes to divorce, you should not let your emotions take over. Divorce tax issues are some of the most common tax issues that people in the US face. You need to consider your CPA's advice on how to file your return. Community property states will treat certain issues differently than other states. There are basis of property issues, transfers between spouses, etc. to consider.

Innocent Spouse's tax liability: An important divorce tax issue.

If you qualify for "innocent spouse", then you may not be liable for paying the entire amount that you jointly owe. You may only have to pay a portion, or none of the balance that is due. Most married couples file their returns jointly. However, at the time you seek divorce, you may not want to pay your husband's taxes, especially if you didn't benefit from the income. It is very hard to win the IRS over to your way of thinking. Please see the section on innocent spouse under the "FAQ" tab,

Some Other Common Divorce Tax Issues:

Issue 1- You are getting divorced and you are wondering whether you still have to pay all of the taxes on your joint return. Even if you didn't benefit from the money, such as in the case of under reported income, you are still liable for 100% of the tax. The Internal Revenue Service seeks to collect the balance that is due from any one of the parties. But if you qualify for "innocent spouse", then you will not have to pay the additional tax that is due.

Issue 2- One of the many divorce tax issues that most people face is whether they should inform the IRS that they are getting divorced. There is no need to. If you file married filing separate, then the IRS will know. If money is owed from previously filed years as married filing joint, then when resolving the liability, you will report your status on the 433a form you fill out.

Issue 3- If you are wondering whether or not you can deduct legal expenses incurred on your divorce, then the answer is no. You cannot deduct these expenses. Legal expenses relating to property and taxes are deductible. Have your attorney give you a separate accounting. Expenses for the collection of alimony is deductible, as alimony is taxable.

Issue 4- Before you finalize your divorce, it is advised that you get your joint credit report from the major three credit reporting agencies; even if you completely trust your spouse. Many people may get into debt without the knowledge of their spouse. Credit issues come into play when considering a joint payment plan for any delinquent balance, as well as qualifying for innocent spouse.

I can help those residing in different areas with their prior years taxes and returns. My practice is devoted primarily to representing taxpayers before the IRS. I specialize in helping people with tax problems, IRS problems, and give you the advice to your issues at hand.

Check out our website www.taxproblem.org for free advice.

Think Again

So, You Think You Have Your IRS Situation Handled?

Do You Really Have The Monthly Payment Plan/Installment Agreement That You Think You Have?

Think Again! I don't care who negotiated it for you - chances are it is not a valid agreement. What's your computerized two digit agreement status code? Do you have a copy of the 433D Form in your hand signed by not the revenue officer, but the manager or branch chief? If not, I would be very concerned. Even if you do have both of the above, there are three things that you can do innocently to break the agreement. This is why over 90% of the people I meet with do not have a valid installment agreement. Without one, the IRS can and will take collection action. Your spouse's paycheck, your social security, your company retirement, etc., can all be seized!

Has Anyone Pulled Your Record Of Account For Years Surrounding The Years You Owe?

I have found many mistakes in them. You may have a refund coming. Or since a year wasn't included in the agreement the IRS can now seize your paycheck, etc., to pay it. Even if that year was never mentioned in the discussions to get the agreement in the first place!

Do You Owe Payroll Taxes From A Corporation?

I can save you money with legal ways you probably haven't considered yet, and can possibly cut your taxes in half.

Did You Apply The Statue Of Limitation Rules To See If There Are Any Years You Don't Have To Pay?

You don't have to file a bankruptcy (and ruin your credit) to do this!

Did You Know Over 90% Of Bankruptcies, In My Opinion, Are Not The Best Way To Handle The IRS?

If you owe a lot of money to people other than the IRS and need creditor protection, or some years you owed were assessed over three years ago and qualify for a discharge (you never have to pay it) then a bankruptcy will help. Most other reasons don't hold water - find out why.

Do You Qualify For An Offer In Compromise?

This is where the IRS will take less money and forgive the rest! I can probably tell you within fifteen minutes on the phone if you qualify.

Do You Think The IRS Can't Touch You Because You Are Earning Money Off The Books, And Are Essentially Hiding Out?

Then think again!

I Have Talked To A Lot Of People Who Are Afraid To Find Out That What They Spent A Lot Of Time And Money For Was Not Valid!

It's human nature to not want to accept big errors. What will it take? Are you going to wait for the IRS to seize your house, paycheck, or spouse's paycheck? In community property states, marriage makes your spouse's income subject to levy for taxes you owed prior to marriage! Does the IRS need to seize your business, life savings or retirement plan before you realize you are not protected? You now have a free and easy way to find out how to best handle your IRS situation. I invite you to have the courage to face it!

IRS Solutions

First some questions, then the IRS solutions...

1. Do you disagree with what the IRS is charging you an hour and what they quickly want you to pay?
   
   Read Appeals
   
    


2. Do you want to know how a bankruptcy can offset your tax liability?
   
   Read Bankruptcy
   
    


3. Are you looking for a tax advisor and want to know the qualifications to look for?
   
   Read Best Way To Select A Tax Advisor
   
    


4. Do you have returns that are not filed for yourself personally or your business? This includes form numbers such as 1040, 1120, 1065, 941, 940. etc. For these IRS solutions
   
   Read Delinquent Returns
   
    


5. Are you being charged taxes or income attributable to your spouse? They haven't paid, and you want protection?
   
   Read Innocent Spouse
   
    


6. Are you about to be audited, or currently going through an IRS audit?
   
   Read IRS Audit
   
    


7. Do you want information on tax liabilities relating to different IRS forms?
   
   Read Irs Forms
   
    


8. Do you want information on handling various collection letters and notices?
   
   Read Letters And Notices
   
    


9. Are you concerned about the IRS filing a lien or levy on you or your company?
   
   Read Liens And Levies
   
    


10. Are you interested in settling your debt with the IRS by paying less than the total amount owed? (Because of your lack of ability to pay, not because you think you have a good reason to get the penalties removed.)
    
    Read Offer In Compromise
    
     


11. Is the IRS currently charging you with unpaid taxes, no matter what type?  Do you not owe it or are you seeking IRS solutions to either reduce it, or to make affordable payments? You may also at this time be seeking a way to stop the IRS from taking your house, car, paycheck, etc. Do you owe money on tax returns you have not actually sent in to the IRS yet?
    
    Read Owing
    
     


12. Do you have a corporation or LLC that owes payroll taxes?
    
    Read Payroll Tax
    
     


13. Are you concerned about the penalties and interest charged to you ?
    
    Read Penalties And Interest
    
     


14. Are you scared of dealing with the IRS?
    
    Read Scared Of IRS
    
     


15. Think IRS matter is handled?  Think Again!
    
    Read Think Again

Scared Of IRS?

ARE YOU SCARED OF THE IRS?

Some People Say, "I'm Scared Of The IRS", Is That You?

The IRS relies on taxpayers being scared of the consequences of not filing on paying their taxes. They pray on that fear to effectively get people to file and pay, not only their taxes, but high amounts of interest and penalties.

Scared Of An IRS Seizure?

Although many IRS representatives will try to get your business by telling you that the IRS will seize your house, car, bank account, wages, land, etc., the truth is that seizures don't happen that often. If you make the effort to file any delinquent returns and to negotiate any taxes owed, the IRS won't try to seize your property. 

Why You Should Not Be Scared Of The IRS Seizing your assets!

Because educated taxpayers with experienced representatives know they have ways to avoid being a victim of the IRS. They only have as much power as we allow them to have. Unfortunately, we are so scared, or wait to the last minute to get help, that we allow ourselves to be frightened by unprofessional tax representatives.




We get many calls each week from people who never took out the time to search the Internet for complaints against the company they want to hire. So if you are saying in your head "I'm scared of the IRS", contact us now!



Call us now at 713-774-4467 and you will not need to be scared of the IRS Seizing your hard earned money!

Penalties And Interest

Penalties, Interest, And Ways To Reduce Your Liability

There are a lot of false promises being made to consumers by representatives concerning the removal of interest and penalties. Many people use that as a way to justify paying representation fees." If you can save me $20,000. of interest and penalties, I will gladly pay you $2,000." is an example. Unfortunately, interest is hardly ever waved, and penalties are not waved nearly as often as people are led to believe.

Reducing IRS Penalties

Removing penalties on your first late personal tax return form 1040 should be easy. It's pretty much a given. After you pay the liability you can call and request a penalty removal. Just tell them that you forgot to file on time, or thought that you did. Or you could fill out form 843 claim for refund.  I would still try to prove reasonable cause and not willful negligence was the reason.



You may use form 843 for any years of personal returns, or other returns that you want to claim a penalty abatement for.

Reducing Interest

Interest is charged when there is a balance due. When a tax liability is reduced or abated, the corresponding interest will be too. When a penalty is abated, the interest on that penalty must be abated too. Interest can be abated if it can be shown that it is attributable in whole or in part to an unreasonable error or delay by an officer or employee of the IRS. You have to prove...

• a) That the error or delay occurred in connection with 'a procedural or mechanical act' or a 'managerial act' associated with the case.
  
   


• b) The error or delay occurred after the IRS contacted the taxpayer 'in writing' about the case.
  
   



• c) No 'significant aspect' of the error or delay can be attributed to the taxpayer's actions.

If you want to request relief of interest charged due to an error or delay I encourage you to do so. I have never attempted to do this given the IRS posture in defending these claims. It is hard for an honest practitioner to justify charging the fees necessary to defend this, given the odds against it. You of course can try this on your own. I would look further into how cases are settled and what the taxpayer advocate has to say about it. A lot of research will be necessary. You can always appeal a decision  against you if the facts are in your favor.

The Three Ways To Reduce Your Tax Liability In General Are:

• a) Pull your record of account and make sure the IRS has recorded your payments. Make sure if they removed any penalties they took off the related interest. Make sure you file original returns for any years that they filed a SFR (substitute for return). Make sure you file original reports for any payroll report, under code 6020b that the IRS filed.
  
   


• b) Amend any returns that you think are not correct. Submit proof with the return and your copy of new return and the amended version. Do not be afraid of an audit by doing this. Submitting your documentation will prove your case, so they will see little chance in auditing you.
  
   


• c) Apply for penalty abatements according to the instructions in this site.
  
   

For more information, please see the IRS Appeals page.