TaxCure Blog

As of April 25, 2022, the IRS has increased its Collection Financial Standards. These standards are budgetary allowances the IRS uses when assessing a taxpayer’s ability to pay delinquent taxes. The standards refer to the amounts the IRS determines are allowable, reasonable, and necessary for taxpayers in regards to common household budgetary categories. aThey are based on the Bureau of Labor Statistics, U.S. Census Bureau, and American Community Survey.

On November 15, 2021, the Taxpayer Advocate Service (TAS), an independent IRS unit, announced two significant changes to the IRS Offer in Compromise (OIC) program, which are favorable for taxpayers who owe federal taxes. This new policy in OICs marks a significant shift for the benefit of taxpayers with accepted offers. It will also help taxpayers experiencing financial hardships. The TAS collaborated with the IRS to remove some obstacles for taxpayers considering an OIC. An OIC allows taxpayers to settle their tax liability for less than the full amount owed for the tax year(s). An accepted offer benefits the taxpayer by bringing welcome tax liability finality for the tax year(s) included in the offer.

As I was going about my day, I received automated robocalls (one of many over the last few months) from a so-called Mary Fletcher discussing how as a state resident I may want to consider enrolling in the new tax compromise program provided by the American Rescue Plan Act of 2021. I also received another from Eva Smith, about the Offer In Compromise program that is “now open for enrollment.” As soon as I received the message, I knew it was false or misleading. Here is a transcription of the voicemails I received (and many others probably received) and what you should do if you are facing tax problems.

Business owners who fall behind on filing timely returns and paying federal payroll taxes often are faced with unpaid state payroll taxes.[1] The more employees the business has the more complex payroll taxes become. This can be further complicated when business owners are not knowledgeable about the nuances regarding the classification of a worker for employment tax purposes. When business owners fall behind in paying their payroll taxes, the key is retaining the services of a qualified tax firm with experience in addressing both federal and state payroll tax issues to minimize monetary penalties and criminal exposure at the personal level.

Approximately 81% of the US Treasury’s tax revenue comes from payroll taxes and federal withholding. Also called trust fund taxes, these employment taxes include Social Security, Medicare, and income tax withheld from employees’ paychecks.