Discussion:Figured it out--the tax resolution ads

What these guys advertise are the unwitting taxpayers who don't have a legit tax debt, which the companies handle for a fee, and get knocked down to nothing. And they blow their trumpets. Well, I, too have a 100% success rate on those over 25 years of practice!

Now we know. Make sense?

That makes perfect sense, JR1.

I've got one in the works now - she owes about $15,000 and we've submitted an offer of $500. I believe the IRS will accept it, based on the info submitted. If not, she will take her $500 across the street to the bankruptcy attorney in a few more months. Then HE will get to say he saved his client thousands, instead of me saying it.

Just turned down a request to handle one that I felt had no shot. I'd pestered this client repeatedly several years ago to make sure the son was paying taxes on his 1099 work, and was assured it was taken care of, and the son pretty much had the attitude that it was none of my business. So I figured he had another preparer. Wrong. The IRS finally caught up with him, wants back taxes (rightfully so), and the son is now gainfully employed. I just didn't see any basis for filing the OIC, but Roni Deutsch was willing to take him on - for a hefty fee of course.

Dealing with tax notices on returns I prepared (not often thank goodness...) or even ones I did not prepare (most often) are fine. Preparing an OIC and that type of work needs to be done by the ones (like you) who really know that area. I myself, have no desire to learn or get involved in that area of tax practice.

The first thing I try to do on a case is get the account in currently not collectible status if I can to get the client off the hot seat. After that it is almost pot luck. Using judgment does not seem to be part of the process. I've had a settlement officer reject an offer where the taxpayer had 400% interest payday loans that she thought should have been used to pay the tax due. She needs to make a drive through the ghetto. That taxpayer is now in bankruptcy and IRS will get zero. Another did not want to allow enough gas money for the taxpayers 141 mile commute but would have allowed even more than I wanted if he moved to the high rent area closer to work. On the other hand, I just got one accepted where $6,300 will settle a $400,000 balance due. The offer examiner wanted $6,900 but I managed to convince her that the taxpayers 12 year old car wasn't worth quite what she thought.

Your profile doesn't say whether you are a Tax Court practitioner. I have heard that sometimes enrolled agents, and I would assume therefore CPAs as well, do a kind of Tax Court representation in the process of post-petition referrals to Appeals. THat sounds like a very sensible arrangement to me so I wondering it it's true?

Have you thought about taking the Tax Court exam?

I have one right now that owes about 22K, but due to a SFR. File the return and then IRS knows what they deducted. Simple logic but clients do NOT open the envelopes from IRS and therein lies the problem.