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Understanding a Federal Tax Lien Part I

Understanding a Federal Tax Lien Part I:

A federal tax lien is the government’s legal claim against your property when you neglect or fail to pay a tax debt. The lien protects the government’s interest in all your property, including real estate, personal property and financial assets. A federal tax lien exists after:

The IRS:

* Puts your balance due on the books (assesses your liability);

* Sends you a bill that explains how much you owe (Notice and Demand for Payment); and

You:

* Neglect or refuse to fully pay the debt in time.

The IRS files a public document, the Notice of Federal Tax Lien, to alert creditors that the government has a legal right to your property. For more information, refer to Publication 594, The IRS Collection Process (PDF) .

Next week – How do you remove a lien against your property?

(IRS.gov) (TTT 12/04/18)

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What’s the Difference Between a Levy and a Lien?

What’s the Difference Between a Levy and a Lien?

A levy is a legal seizure of your property to satisfy a tax debt. Levies are different from liens. A lien is a legal claim against your property to secure payment of your tax debt, while a levy actually takes the property to satisfy the tax debt.

A federal tax lien comes into being when the IRS assesses a tax against you and sends you a bill that you neglect or refuse to pay it. The IRS files a public document, the Notice of Federal Tax Lien, to alert creditors that the government has a legal right to your property. You have the right to appeal if the IRS advises you of the intent to file a Notice of Federal Tax Lien. Your appeal rights are explained in IRS Publication 1660, Collection Appeal Rights (PDF).

When filed, the Notice of Federal Tax Lien is a public document that alerts other creditors that the IRS is asserting a secured claim against your assets. Credit reporting agencies may find the Notice of Federal Tax Lien and include it in your credit report. An IRS levy is not a public record and should not affect your credit report.

(www.IRS.gov) (TTT 11/27/18)

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Taxpayers Now Have More Time to Challenge a Levy

 

Taxpayers Now Have More Time to Challenge a Levy

The IRS reminds individuals and businesses that they have additional time to file an administrative claim or bring a civil action for wrongful levy or seizure. Tax reform legislation enacted in December extended the time limit from nine months to two years.

Here are some facts about levies and the extension of time to file a claim or civil action:

  • An IRS levy permits the legal seizure and sale of property to satisfy a tax debt. For purposes of a levy, the term “property” includes wages, money in bank or other financial accounts, vehicles and real estate.
  • The timeframes apply when the IRS has already sold the property it levied. Taxpayers can make an administrative claim for return of their property within two years of the date of the levy.
  • If an administrative claim is made within the extended two-year period, the two-year period for bringing suit is extended for one of two periods, whichever is shorter:

    o Twelve months from the date the person filed the
    claim.
    o Six months from the date the IRS disallowed the
    claim.

  • The change in law applies to levies made before, on or after December 22, 2017, as long as the previous nine-month period hadn’t yet expired.
  • Anyone who receives an IRS bill titled, Final Notice of Intent to Levy and Notice of Your Right to A Hearing, should immediately contact the IRS. By doing so, a taxpayer may be able to make arrangements to pay the liability, instead of having the IRS proceed with the levy.

(Tax Reform Tax Tip 2018-123)   (TTT 11/13/18)

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IRS Appeals – Specific Dollar Settlements

IRS Appeals – Specific Dollar Settlements

What is “IRS Appeals?” The Office of Appeals is an independent organization within the IRS that helps taxpayers resolve their tax disputes through an informal, administrative process. Their mission is to resolve tax controversies fairly and impartially, without litigation. Appeals reviews cases after the IRS has made its decision, offering an objective point of view on each appealed case.

What is “Specific Dollar Settlements? A Specific dollar settlement is the settlement of a case for a percentage or stipulated amount of the tax in controversy that approximates the amount that would have been reached by computing the tax.

The IRS Office of Appels has issued guidance on when specific dollar settlements are appropriate. There are four areas:

* The case is a small tax case. The term “small tax case” means a non-docketed or docketed case that would qualify for “S” case procedures, if docketed.

* There are nonrecurring issues.

* The settlement only affects years under Appeals’ jurisdiction.

* There is a single entity/taxpayer.

For more information IRS 2018-ARD 139-1 Appeals Memorandum: Specific dollar settlements: form 5402 July 5, 2018. (TTT 10/23/18)

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IRS Email Subscriptions (IRS Tax Tip 2018-97)

IRS Email Subscriptions (IRS Tax Tip 2018-97)

The IRS issues tax information by email for many different audiences. Here are some of the electronic subscriptions people can request by visiting the e-News Subscriptions page on IRS.gov: * Guidewire: People who sign up for Guidewire receive email notifications when the IRS issues advance copies of tax guidance, such as regulations, revenue rulings, revenue procedures, announcements, and notices. * e-News for Tax Professionals: Provides the latest national news for the tax professional community, as well as links to resources on IRS.gov and local news and events by state. * Outreach Corner: Provides organizations such as businesses and non-profits articles content that they can use in their own communication products and newsletters. * Tax Statistics: Supplies information about the most recent tax statistics. * Quick Alerts: Provides tax professionals and tax software providers with the latest information about e-file issues and events. * IRS Newswire: Provides news releases issued by IRS National Media Relations Office in Washington, DC.

Here are some other electronic subscriptions the IRS offers: * Alerts from Office of Professional Responsibility * e-News for IRS Continuing Education Providers * Modernized e-File News for Partnerships * e-News for Payroll Professionals * e-News for Small Business * e-File News for Large Businesses * Foreign Accountant Tax Compliance Act News & Information * Employee Plans * Indian Tribal Governments News * Tax Exempt Bond Community Update * Exempt Organization Update * Federal State & Local Governments The IRS also offers Consejos Tributarios del IRS, a newsletter in Spanish.

(TTT 10/16/18)

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Get Your Refund Faster: Tell IRS to Direct Deposit your Refund…

Get Your Refund Faster: Tell IRS to Direct Deposit your Refund…

The best and fastest way to get your tax refund is to have it electronically deposited for free into your financial account. The IRS program is called direct deposit. You can use it to deposit your refund into one, two or even three accounts.

Eight out of 10 taxpayers get their refunds by using Direct Deposit. It is simple, safe and secure. This is the same electronic transfer system used to deposit nearly 98 percent of all Social Security and Veterans Affairs benefits into millions of accounts.

Combining direct deposit with IRS e-File is the fastest way to receive your refund. IRS issues more than 9 out of 10 refunds in less than 21 days. You can track your refund using our Where’s My Refund? tool.

Direct deposit is easy to use. Just select it as your refund method through your tax software and type in the account number and routing number. Or, tell your tax preparer you want direct deposit. You can even use direct deposit if you are one of the few people still filing by paper. Be sure to double check your entry to avoid errors.

(IRS.gov) (TTT 10/9/18)

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Extension filers have until October 15th to file

Extension filers have until October 15th to file

Did you request an extension of time to file your tax return? If so, the deadline for filing is coming up — it’s Oct. 15. When you file, don’t forget to take advantage of tax credits from the American Recovery and Reinvestment Act that you may be eligible for. You could be eligible if you bought a new home or car, or went to college or made your home more energy efficient. The fastest and easiest way to complete and file your return is to e-file. You can do it for free through Free File on this website, IRS.gov. If you’re due a refund, you’ll get it faster if you opt for direct deposit.

(IRS.gov) (TTT 10/2/18)