I was recently interviewed in a three part video series about the business of tax problem resolution. The first video in the series asks the question: “how did you get into the tax problem resolution niche to begin with?” This video interview explains how I got started over sixteen years ago and why I never looked back.
(*Below the video is information for CPAs, attorneys and Enrolled Agents about why they should consider handling tax problem clients).
Here are some of the reasons why the tax resolution niche is so appealing:
IRS problems affect every aspect of one’s life – In my years of handling tax resolution cases, it became clear that people who were struggling with tax issues also had other debt problems that were causing huge strains on their relationships with significant others. What I soon discovered was that these are regular people facing intimidating financial challenges and I could help them.
Fighting for the underdog – I like a good fight especially when it’s sticking up for the little guy. When clients are up against the IRS it’s similar to the David vs. Goliath battle, but I like that challenge. Helping people resolve their tax issues is a very self-rewarding feeling and one of the reasons that I got into this niche in the first place.
You really help people – As I discovered in the research I did prior to my first audit, when it comes to tax resolution issues the law was on the side of my client. I just needed to leverage that advantage to help them reduce their tax liability often quite significantly. Helping people get financial house in order allows them to move on with their lives.
As a tax professional, I know that many of you right now are in a dark office preparing tax returns. I’m here to tell you that there is a better way to grow your business. I created the following video to demonstrate how adding and marketing to clients with tax problems can supercharge your profits.
I founded the Tax & Business Solutions Academy™ to share my 16 years’ of experience as a tax resolution professional and help CPAs, attorneys and Enrolled Agents maximize their earning potential. I encourage you to visit my website, join my email list, and download free content and videos to help you get in the business of growing your business!
CPAs, attorneys and EAs all need a little comic relief to get through the tax season. Here are a few of my favorite funny tax quotes. On a serious note, the sooner you add tax resolution to your practice, the sooner you don’t have to be codependent on tax season (and endure the stress of it). Solving tax problems is a year round business that can boost your business.
“Tax law is a funny thing. I think it fair to say that most CPAs know something about the federal income tax; many if not most lawyers do not.” ~ Bernard Wolfman
A CPA goes into a pet shop to buy a parrot. The shopkeeper shows him three identical parrots on a perch and says, “The parrot on the left costs $500.” “Why does that parrot cost so much?” asks the CPA. “Well”, replies the owner, “it knows how to do complex audits.” “How much does the middle parrot cost?” asks the CPA. “That one costs $1,000 because it can do everything the first one can do plus it knows how to prepare financial forecasts.” The startled CPA asks about the third parrot, to be told it costs $4,000. Needless to say, this begs the question, what can it do? To which the owner replies, “To be honest, I have never seen him do a darn thing, but the other two call him Senior Partner.”
“I would suggest the taxation of all property equally whether church or corporation, exempting only the last resting place of the dead and possibly, with proper restrictions, church edifices.” ~ Ulysses S. Grant
I get a lot of calls from my academy members regarding IRS audits. A common question is: “should I bring my clients to the audit?” For 16 years, except for on the rarest of occasions, my answer has always been “no.” If your client is asked a direct question by the IRS Revenue Agent during the exam your client is compelled to answer absent exercising their 5th amendment rights (which is probably worse).
Even idle chatter is considered fair game by an IRS auditor.
A recent case in point was featured in The March 14, 2014 Kiplinger Tax Letter, “Talking too much during an audit leads to tax woes.” A husband and wife were chatting with a revenue agent who had begun an examination of their return, when the husband inadvertently alerted the auditor to a home sale that occurred in the year prior to the one under exam.
The couple claimed the gain from that sale was tax free on account of the home sale exclusion, but the agent ended up expanding the audit to include the previous year. He found out that the couple rented out the home to their son and his family and didn’t actually live in the in the house. A district court agreed with the agent and they didn’t qualify to exclude ANY portion of their gain (Cohen, D.C., N.Y.). Thus, the husband’s loose lips cost the couple over $150,000 in tax, penalties and interest.
Don’t let your client’s loose lips sink the IRS audit ship.
For more marketing, sales, tax resolution and business practice tips subscribe to my blog and join my email list on http://rozstrategies.com/.
Owing money to the IRS or state taxing authority is no picnic. The audit process is intimidating, time-consuming, and can be costly especially true if additional taxes are assessed. Not to mention, the stress it causes people who have fallen on hard times can impact their personal and professional lives. Marriage, relationships, reputation and more.
Given the current economic climate, the IRS is now more willing to make deals with folks who have IRS back taxes. If you have clients with these three characteristics below, then they could be a good candidate for tax resolution.
owes $10,000 in back taxes
over three years of unfiled tax returns
is under audit
Learn how to take a client’s tax burden off their dining room table and into your offices to resolve.
If your client owes $10,000 or less – has all their returns filed and can pay the balance back in 36 equal monthly installments the IRS GUARANTEES acceptance into their Installment Payment Plan Program. You can call the IRS or attach form 9465-FS, Request for Installment Agreement.
If your client owes up to $25,000 – has all their returns filed, is not under a wage garnishment or bank levy and can pay the full amount in 72 months (or until the Collection Statue Expiration date, whichever is shorter ) or less, the IRS will grant them a monthly Installment Payment Plan under their “fresh start” initiative. Limited financial disclosure is required. You can call the IRS’s Automated Collection System (ACS) to get this done or attach Form 9465-FS.
If your client owes between $25,000 and $50,000 – has all their returns filed, is not under a wage garnishment or bank levy and can pay the full amount in 72 months (or until the Statute of limitations on Collections expires, whichever is shorter) through a direct debit Installment Agreement (“DDIA”), the IRS will grant a monthly Installment Payment Plan under their “fresh start” initiative. The client must have a bank account designated for the IRS to automatically debit on a monthly basis. Limited financial disclosure is required. Form 433-D, Installment Agreement is required.
If your client owes over $50,000 – tax resolution is still possible, but the IRS wants more financial information. You will need to submit Form 433-A (collection Information Statement) which requires full financial disclosure and proof of income and expenses. The IRS then computes your client’s ability to pay. Important note: It is unwise for the taxpayer to represent themselves at this juncture. A capable tax resolution professional who can advocate on a client’s behalf may be worth its weight in gold when going up against the IRS.
If your client is unable to pay a liability owed to the IRS in full through a lump sum or through a monthly installment payment plan, they may eligible for the IRS’s Offer in Compromise Program. An offer in Compromise is an agreement between the taxpayer and IRS where the IRS agrees to take less (sometimes, much less) than the amount owed to settle the matter. The IRS looks at the debtor’s income and assets to determine what they can pay and client’s are obligated to prove they don’t have the money to pay the tax debt even over time. But while the Offer in Compromise is an invasive intrusive paper blizzard, if your client is a good candidate it can help save their financial life!
The very worst step client can take is to ignore the IRS
Every letter/notice sent by the IRS requires a response. Sometimes, the correct response is NOT to respond. How does the average taxpayer know what to do when? They simply don’t. That’s where you come in. Remember, the IRS is the only federal agency where you are “guilty” until proven innocent. They also happen to be the most brutal collection agency on the planet. Their mission is to assess (via audits) and collect the tax. Period. This is where being a competent tax resolution expert who understands IRS procedures and protocol becomes a valuable asset to your clients in resolving their tax issues.
Subscribe to my blog and join my email list on http://rozstrategies.com/ for more marketing, sales, tax resolution and business practice tips.
As many of us get immersed in tax season, I feel it is helpful to share some comic relief. Here are some of my favorite tax quotes and tax humor – at Uncle Sam’s expense, naturally.
Here, late night comedians wade into:
“Nobody likes taxes, but they’ve been around forever. Taxes date back all the way back to the year one, when baby Jesus was visited by two wise men and an IRS agent, who demanded half the family’s frankincense.” –Jimmy Kimmel
“The U.S. Senate is considering a bill that would tax Botox. When Botox users heard this, they were horrified. Well, I think they were horrified. It’s difficult to tell.” –Craig Ferguson