Monthly Archives: April 2017


Offer in Compromise Success ($500 settlement on $68,000 income tax debt): Our tax resolution team announce another successful IRS settlement. Our client, Joseph M. from Hutchinson, MN reached out for our helping hand November 15th, 2015. At that time, Joseph owed the IRS $68,000. He had all of his returns filed, so he was fine with being tax compliant. He earns $6K per month but Joe has $2000 per month in court-ordered child support, which he pays. He also has health insurance that was increasing an additional $300 per month. He had no assets of any kind. Our team, the best IRS help, proved to the IRS that Joe could only pay a total of $500 to settle his $68,000 income tax debt. Now Joe has the Fresh Start he deserves. He will be required to file his tax returns on time and pay whatever he owes for 5 straight years. We congratulate Joe. Who else wants to find out if your income tax debt can be settled?



Private Collection of Some Overdue Income Taxes

Starting this month, the IRS will begin sending letters to a select group of taxpayers whose overdue federal income tax accounts are being assigned to one of four private-sector collection agencies.


We all know how abusive collection agencies can be and have been. We can all imagine a collection agency employee using the power of the Federal Government to abuse a financially struggling taxpayer so that they can collect a commission. We can all imagine a collection agency collector abusing a struggling taxpayer and denying them their rights.


This is a new program that was authorized under a federal law enacted by Congress in December 2015 which enables these designated contractors to collect, on the government’s behalf, unpaid tax debts. Taxpayers being assigned to a private collection agency would have had multiple contacts from the IRS in previous years and still have an unpaid tax bill.

John Koskinen, the IRS Commissioner stated, “The IRS is taking steps throughout this effort to ensure that the private collection firms work responsibly and respect taxpayer rights. The IRS also urges taxpayers to be on the lookout for scammers who might use this program as a cover to trick people. In reality, those taxpayers whose accounts are assigned as part of the private collection effort know they have a tax debt.”

How Does the New IRS Program Work?

The IRS will always notify a taxpayer before transferring their account to a private collection agency (PCA). First, the IRS will send a letter to the taxpayer and their tax representative informing them that their account is being assigned to a PCA and giving the name and contact information for the PCA.

Only four private collection agencies are participating in this program: CBE Group of Cedar Falls, IA; Conserve of Fairport, NY; Performant of Livermore, CA; and Pioneer of Horseheads, NY. The taxpayer’s account will only be assigned to one of these agencies, never to all four. No other private collection agencies are authorized to represent the IRS.

Once the IRS letter is sent, the designated PCA will send its own letter to the taxpayer and their representative confirming the account transfer. To protect the taxpayer’s privacy and security, both the IRS letter and the PCA’s letter will contain information that will help taxpayers identify the tax amount owed and assure taxpayers that future collection agency calls they may receive are legitimate.

IRS Penalty Abatement – IRS Tax Attorney – IRS Penalties



It seems like the Internal Revenue Service (IRS) loves punishing taxpayers with income tax penalties and interest. Income Tax penalties began as a way to encourage prompt payment of taxes owed to the government. IRS penalties are added to overdue income tax debt so often now that the extra charges have become a primary money maker for the IRS. According to the Internal Revenue Service Data Book, 2014 $25.5 billion dollars of civil penalties were assessed.

The best IRS help team at Flat Fee Tax Service, Inc. will work to help you, the taxpayer, who may qualify for removal of IRS penalties or penalty abatement.

What is an IRS penalty abatement? IRS penalty abatement is defined as removal of certain penalties assessed by the IRS.

Two common penalties that can meet criteria for possible abatement are:

  • Failure-to-File: “A failure to file penalty may apply if you did not file by the tax filing deadline”. (IRS Tax Tip 2013-58, April 18, 2013)
  • Failure-to-Pay: “A failure to pay penalty may apply if you did not pay all of the taxes you owe by the tax filing deadline”… (IRS Tax Tip 2013-58, April 18, 2013)

Each of these income tax penalties is calculated a bit differently. Although both are capped at a maximum of 25% of your unpaid tax. The Failure-to-File penalty is generally 5% of your unpaid tax for each month the return is late. The Failure-to-pay penalty is generally .5% of the unpaid tax for each month it is late. The IRS will assess penalties for partial months.

As an example: If you owed $100,00.00 on your individual income tax return and filed an extension, but paid the total when the extension is due on October 15, your penalty would be approximately $3,000.However, if in the same circumstance you do not file an extension, your failure-to-file penalty may be capped, resulting in a much higher total IRS liability.

Interest generally accrues on unpaid tax in addition to penalties until the debt is paid in full. According to, topic 653, “The interest rate is determined quarterly and is the federal short-term rate plus 3%”, and is compounded daily. The complexity of the calculation can cause taxpayers to owe thousands of dollars in addition to the original tax liability.

Interest will continue to accrue. If penalty abatement is granted the calculation for interest is adjusted accordingly.

Call the best IRS help team at Flat Fee Tax Service, Inc. or complete our form on this website to schedule your FREE and confidential consultation.

IRS Fresh Start Initiative – IRS Offer In Compromise Settlement

The IRS, in 2012, expanded their Offer in Compromise program with its Fresh Start Initiative, to help financially struggling taxpayers who are unable to pay their taxes due to financial difficulties. The Fresh Start Initiative, in addition to providing income tax relief to American taxpayers, also helps the IRS keep a check on the number of tax default cases, as it encourages more taxpayers to settle their old income tax debt so they can resume tax compliance.

What Qualifies You For The Fresh Start Initiative?

The IRS, under the Fresh Start Initiative, provides a number of options to financially distressed taxpayers.

1. IRS Penalty Relief

The Fresh Start Initiative allows eligible taxpayers up to a 6-month extension to pay their taxes. The IRS penalty for not paying income tax debt by April 15 is waived off until October 15. If, however, the taxpayer fails to pay their income taxes beyond the revised date, a penalty is charged.

The IRS penalty relief is available to two categories of taxpayers

  • Wages earning individuals who have been unemployed for a minimum of 30 consecutive days.
  • Individuals who experienced a dip of 25 percent or more in their income due to a slowdown.

Fresh Start Qualification Criteria

If you are married and filing jointly, your adjusted gross income must not exceed $200,000. If your filing status is single, qualifying widower, head of household, or married filing separately, the adjusted gross income must not exceed $100,000. In addition, if you have an outstanding of more than $50,000, you will not be qualified to receive a waiver.

2. IRS Installment Payment Plan

The IRS Installment Agreement provision allows taxpayers to pay their income taxes, in installments, in a scenario wherein the taxpayer is unable to pay in full. It also gives taxpayers more time to pay. The threshold for the maximum amount of debt against which an installment plan can be prepared has now gone up from $25,000 to $50,000, with the maximum term for the repayment of installments being 6 years. Though you need to pay less in penalties, the interest will continue to accrue on your outstanding dues.

Taxpayers can set up an installment agreement with IRS by using the Online Payment Agreement ( without any intervention of an IRS agent. It is, however, essential that they agree to pay the installments through a direct debit mode.

3. Offer in Compromise (OIC) IRS Settlement

The Offer in Compromise provision allows financially struggling taxpayers to settle their outstanding income taxes for less than what they actually owe to the IRS. After the expansion of “Fresh Start” initiative, it has become easier for taxpayers to qualify for an Offer in Compromise settlement, as the IRS has relaxed the qualification standards, and therefore, more people are now eligible to settle with the IRS for less.


To apply for an Offer in Compromise (OIC) settlement, the taxpayer needs to file Form 433-A (OIC) or Form 433-B (OIC), and deposit a non-refundable application fee of $186. If, however, the taxpayer qualifies under the Low Income Certification guidelines, they would not have to pay the application fee. In addition to the form and application fee, the taxpayer may also be asked to pay the first month’s installment or 20 percent of the settlement amount, at the time of filing.

IRS Wage Levy – IRS Bank levy – IRS Seizure – IRS Tax Attorney

An IRS Levy is among the most destructive tools the Internal Revenue Service (IRS) uses to collect what you owe them. An IRS bank levy effectively freezes your available funds in your bank account. The IRS freezes the funds in your bank account often leaving you with no money. Your seized assets are then applied by the IRS to your income tax debt. Any resulting unpaid checks or bank fees only add to your financial problems. Any account with your name on it may be at risk of a bank levy – even if the money isn’t yours. Financial institutions must comply with IRS requests or they will be subject to severe IRS penalties. Even if your paycheck is directly deposited into your account(s), you may not be able to access the funds.

You have 21 days (includes weekends and holidays) to get your money back.



An IRS wage levy also known as a wage garnishment presents similar challenges. In these situations, the Internal Revenue Service (IRS) sends your employer a written notice requesting a major portion of your pay as payment for your outstanding income tax bill. Just like banks, your employer must obey the IRS’s request or face severe legal punishment.

The IRS can exercise complete control of your existing and future assets. You need to know that if you are self-employed, your clients or customers will receive a demand for collection in what’s known as a “payor” levy. The payments they owe you are then sent to Internal Revenue Service (IRS). Bank and wage levies may allow the IRS to control every decision and financial move you make.

The IRS may also seize your Social Security, your Social Security Disability (SSDI) or your Veteran’s Pension. The IRS may seize a minimum of 15% (or more) under the Federal Payment Levy Program (FPLP).

An IRS wage levy (wage garnishment remains in place until you pay your tax liability or until a levy release is negotiated.

Receiving a notice from the IRS of Intent to levy requires immediate attention. Don’t lose your paycheck, your bank account or your Social Security.

Call us for your FREE and confidential consultation.

IRS Revenue Officer Help – IRS Tax Attorney


An IRS Revenue Officer is one of the last people you want appearing on your doorstep. Armed with an extensive arsenal of collection weapons, such as liens, levies, garnishments, and seizures, IRS Revenue Officers have all the means to make you pay unpaid taxes. Financial stress, however, is not the only problem at hand, as the IRS Revenue Officer can also contact your neighbors, relatives, and colleagues, causing public humiliation.

How Flat Fee Tax Service, Inc. Can Help

The best IRS help team at Flat Fee Tax Service, Inc. understand that every taxpayer’s issue is unique. Our IRS help team will follow a collaborative approach to create a customized plan of action for every client. Our IRS help team, led by an IRS Tax Attorney, has in-depth discussions with clients to understand your unique issues, and the dynamics at play, such as your income, financial obligations, pending liabilities, and other such factors. Based on the information gathered, we create a holistic plan to help you get your IRS problem addressed.

Why Choose Flat Fee Tax Service, Inc.?

Flat Fee Tax Service, Inc. has a team of widely experienced associates. We are the go-to destination for IRS Revenue Officer assistance. Our IRS Tax Attorney(s) have successfully handled exceedingly diverse and complex cases of unpaid taxes, negotiating favorable resolutions with IRS Revenue Officers on behalf of our clients. Our goal is to always secure the best IRS resolution that suits our clients’ prerequisites and complies with the Internal Revenue Code.

Attributes that set Flat Fee Tax Service, Inc. apart include:
Comprehensive Expertise
Streak of Successful Representations
No-obligation Free Consultation
Affordable Fees
Undivided Focus
Better Business Bureau Accredited
A Plus Better Business Bureau Rating
No Client Complaints


Offer in Compromise or Currently not Collectible?

Failure to meet your annual tax obligation is an invitation to severe financial and legal consequences. The IRS can impose legal penalties, delay reimbursement, and in worst-cases, seize your possessions and put you behind bars. There is no escape from filing and paying your taxes, but the IRS provides a few avenues to help those who are unable to make payments due to financial difficulties. An Offer in Compromise settlement and Currently not Collectible status are two solutions available to help taxpayers who meet the IRS’s financial hardship criteria. Both options, however, have their pros and cons, which you need to be aware of to make an informed decision on which avenue to pursue to resolve your tax issues. To help you decide, we discuss the details in the blog post.

Offer in Compromise

An IRS settlement through the Offer In Compromise program lets the taxpayer settle the entire debt by paying an amount that is less than what is actually owed to the IRS. Certain criteria must be met, then if the IRS agrees to an Offer in Compromise (OIC), the taxpayer should make sure to file their income tax returns on time and pay the tax in full for the next five years.

Offer in Compromise Advantages

  • An Offer in Compromise (OIC) removes a Federal tax lien against the taxpayer.
  • As the income tax debt goes away, you earn more money by not having to pay back taxes.
  • The IRS settlement can be paid in installments.

Offer in Compromise Disadvantages

  • You have to pay $186 as a filing fee to process the request.
  • There is a possibility of the IRS rejecting the request.
  • You must be tax compliant for five years, once the Offer in Compromise (OIC) request is accepted.
  • You must owe $10,000 or more to take advantage of the Offer in Compromise program.

Currently not Collectible Status

If you are unable to pay your income tax debt, the IRS may consider your eligibility for Currently Not Collectible Status. The IRS will cease all collection activities, which includes levies and garnishments until the IRS notices an improvement in your financial condition. The IRS will send a statement that includes detailed information of the income tax debt to the taxpayer every year the account is in CNC (Currently Not Collectible) status. If the taxpayer is not able to pay the amount, the IRS will keep postponing the collection.

Currently not Collectible Advantages

  • You don’t have to pay any amount to the IRS
  • You don’t’ have to worry about tax levies and garnishments
  • The Statute of Limitations continues to run and it may run out on your income tax debt.
  • Currently not Collectible status is your only choice if you owe less than $10,000.

Currently not Collectible Disadvantages

  • Despite your Currently not Collectible (CNC) status, you still owe the IRS and a Federal tax lien, most likely, will be filed.
  • If you do not file a tax return, there is a probability of cancellation of the uncollectible status.
  • A dramatic increase in income can also lead to cancellation of the status.

Making a Decision

If you cannot pay your past due income tax debt, it’s always better to settle the entire income tax debt. Don’t run half the race. Finish the race and get yourself a Fresh Start.