Any taxpayer who has ever faced a tax dispute with the IRS understands how stressful and overwhelming this can be. Our office has seen the devastation that a tax dispute can cause, and how it can make life almost unbearable for taxpayers. No matter how bad your situation may seem it is important to remember that there is a solution available that can resolve your tax controversy with the IRS.
The most important thing to remember is to face this problem and head it off early rather than ignoring the issue. You may feel overwhelmed but ignoring this situation will not make it go away, the IRS will just keep coming and will not simply disappear. The five places to start taking action if you have a tax dispute with the IRS include:
1) Consult with a tax attorney who has experience dealing with the IRS. It is never a good idea to try to take on this government agency without a good lawyer who understands the tax code. The average American taxpayer does not understand the tax code because this code is so massive and complicated, but the IRS does because the agency is responsible for the tax collection. You need someone on your side who understands IRS rules and regulations so that you have a fighting chance and do not get taken advantage of.
2) As soon as you realize that there is a tax dispute with the IRS gather all relevant records and documents that you have and organize them. When dealing with the Internal Revenue Service records are critical, and the more information and documentation you have available the better. Get everything together as soon as the IRS informs you that there is a tax dispute so that you are prepared.
3) Always meet any deadline that the IRS gives you. When you are notified of a tax dispute the IRS will detail the information that the agency wants and the time frame when this must be provided. If you miss deadlines this will just compound the problem and inflate any interest and penalties that you will be assessed. Why make things harder on yourself? Pay attention to IRS deadlines and meet them whenever possible, the dispute process will be easier and less painful on you.
4) Only give the IRS the details and information that has been requested, never provide more than what you were asked for. You may be tempted to send extra documents and information that was not requested, especially if you did nothing wrong, but this error can be a huge mistake. The added information will not typically help your case, but you could be allowing the IRS the opportunity to scrutinize your situation even further. The situation could become worse as a result of your effort to go above and beyond the IRS request.
5) Know what your options are. Before you can decide which option to take you need to know what your choices are and what options you have to choose from. Is paying the full amount that the IRS claims impossible? Would you be able to make a payment plan and keep to it? Are there any IRS programs that you would qualify for which may help eliminate some of your tax debt? Few IRS agents will explain your options clearly so that you know what you can do in this situation. An IRS attorney or qualified tax lawyer can help explain your various options.
If you have been notified of an IRS tax dispute taking action is important. This problem will not simply resolve itself, and you need someone on your side!