Common Myths Related to the IRS Tax Settlements

With years of experience in resolving various tax problems, it is time for me to explore the common myths surrounding the IRS tax settlement. So if you or someone you know owes taxes to the IRS, just do everyone a favor and read the following top tax settlement myths. 

Bankruptcy isn't an option in settling back IRS taxes

It is true that you can file personal bankruptcy, but there are myriad rules to be followed. Within Chapter 7 bankruptcy, all old 1040 tax returns could be fully discharged even if there are tax liens against your home.  

Tax resolution lawyers can wave a magic wand and cut down my taxes and penalty charges

No, this is not correct. An individual in sound financial standing cannot avoid paying the IRS taxes without good reason, and as a matter of fact, these people should pay the required taxes in full. Also, be careful of those fraudulent firms who claim to lower your penalty charges and interest automatically, as there is no such type of procedure in the IRS. 

IRS tax settlement firms are really fraudsters

There are some people who think that all tax settlement companies are a complete scam. We know that this is not true. Whenever someone comes to us, we provide tax consultation for a fixed flat fee. Someone then tells them that they could get it done cheaper or can choose to do it themselves or by a regular CPA. Then, a year later, they come to us again and say, “I wasted a year and lots of money by not hiring you... Will you help me now?” You have to be very careful not to fall victim to scam companies, and you should only get involved with an established firm where tax consultation is not a hobby. 

The IRS filed a tax lien against the properties which are in my spouse’s name

Tax liens could be filed against any of your properties. Unlike judgment liens, the IRS doesn’t need a court ruling to file a federal tax lien. Therefore, if a tax lien is addressed to your spouse’s property, it doesn’t mean that there is a lien against the property.

The IRS can't do anything if I don't open their letters

It doesn’t matter whether you open the IRS’s letters or not, as they can enforce a collection action after specific time frame. Furthermore, you may lose right to tax court and important appeal rights if you don’t open the letters. 

The IRS must produce a court order to levy my wages or bank accounts

No, they don’t. The IRS will send you 3 letters, and if no action has been taken by you, they’ll just wait thirty more days after the final letter has been sent. After that, they have full rights to levy your wages. 

If I simply get rid of my assets by gifting to my friends and family, the IRS can’t touch me or my property

The IRS will consider this approach as fraudulent, and they are allowed by law to disregard the gift. Second, it will take extra work for the IRS to undo the fraudulent conveyance, and this definitely will anger them further. 

It’s a daunting task for many people to get their IRS tax settlement accepted. That’s why we have created a free comprehensive guide, “7 Steps to Sanity,” which provides full guidance in reaching the best possible settlement. Just enroll now to receive your copy.