Missouri
Tax Attorneys

Offers in Compromise

The offer in compromise program is offered by the IRS. An offer in compromise allows individuals to settle their tax debts for less than the full amount owed, based on their ability to pay, income, expenses, and asset equity.

To be eligible for an offer in compromise, individuals must meet certain requirements, such as filing all required tax returns, making estimated payments, not being involved in an open bankruptcy proceeding, and meeting tax deposit obligations if they are an employer.

If the IRS is unable to process an offer in compromise, the application and offer application fees will be returned, and any offer payments included will be applied to the outstanding balance. There are different payment options available, including a lump sum cash payment or periodic payments.

Low-income individuals who meet the certification guidelines do not need to submit an application fee, initial payment, or make monthly installments while the IRS reviews the offer.

If an offer in compromise is rejected, individuals have the right to appeal the decision within 30 days using the Request for Appeal of Offer in Compromise, Form 13711. The IRS Independent Office of Appeals provides additional assistance in the appeals process.

It is important to note that the offer in compromise process can be complex, and seeking the guidance of a qualified tax professional, such as a tax attorney or enrolled agent, is recommended to navigate the requirements and increase the chances of a successful outcome.

IRS Audit Defense

The Missouri Department of Revenue provides a list of frequently asked questions (FAQs) about audits on its website, offering guidance and information to taxpayers. Audits can involve both the Missouri Department of Revenue and the IRS, and they can be triggered by various factors such as claiming rental losses, reporting losses for activities considered as hobbies, or operating small cash businesses.

When individuals receive a notice of an audit, it is common for subsequent notices to address potential penalties associated with the audit findings. Given the complexities and potential consequences of an audit, it is advisable to seek the assistance of a tax lawyer as soon as possible to navigate the process effectively.

Regarding IRS audits, the general timeframe for the IRS to assess taxes is up to three years, although exceptions can be made in cases involving significant errors or fraud. Anderson Bradshaw is a firm that specializes in assisting clients throughout Missouri with various tax audit matters, providing valuable guidance and support during the audit process.

Innocent Spouses

Innocent spouse relief is a provision that applies to couples who have filed joint tax returns and are still married and living together in the same household. It allows individuals to avoid being held responsible for additional taxes when their spouse understated the taxes due on their joint tax return, and the innocent spouse had no knowledge of the mistake.

Underreporting taxes is attributed solely to one spouse, and this allocation must be clearly stated in an audit report. To qualify for innocent spouse relief, the filing spouse must demonstrate that they had no actual or constructive knowledge of the underreported taxes, and it would be unfair to hold them liable for the resulting tax debt.

It is important to note that individuals must seek innocent spouse relief no later than two years after an IRS collection action. Given the complexity of this process and the strict requirements, it is advisable to work with a knowledgeable and experienced lawyer who can provide guidance and assistance in obtaining innocent spouse relief. The IRS carefully evaluates these requests, and having legal representation can help navigate the process more effectively.