VIEWS: 6 PAGES: 2 POSTED ON: 5/5/2012
IRS LIENS IRS AUDITS UNFILED TAX RETURNS Federal Tax Liens are public records that indicate The IRS may file on "SFR" (Substitute For Return) Tax you owe the IRS various taxes. They are filed The IRS can audit you by mail, in your home, Return for you, if you fail to file a return. This is the with the County Clerk in the county from which or in your office. Typically, correspondence IRS's version of an unfiled tax return. Because SFRs are you or your business operates. Because they are audits are for missing documents in your tax filed in the best interest of the government, the only de- public records, they will show up on your credit return that IRS computers have attempted to ductions you'll receive are standard deductions, no per- find. These usually include W-2's and 1099 sonal exemption for spouses, children, interest and taxes report. This often makes it difficult for a taxpayer on your home, cost of any stock or real estate sales, and to obtain a financing on an automobile or a home. income items or interest expense items. This type of audit can be handled through the mail business expenses, etc. will be applied Federal Tax Liens can tie up your personal prop- erty and real estate. Once a Federal Tax Lien is with the correct documentation. The IRS office filed against your property you cannot sell or audit is usually with a Tax Examiner who will IRS PENALTIES transfer the property without a clear title. Often request numerous documents and explanations The most common penalties are: Failure to File and Fail- of various deductions. This type of an audit ure to Pay. Both of these penalties can substantially in- taxpayers find themselves crease the amount you owe the IRS in a very short period in a Catch-22 where they may also require you to produce all bank re- cords for a period of time so that the IRS can of time. To make matter worse the IRS charges you in- have property that they terest on the penalties. Many taxpayers often find out would like to borrow check for unreported income. The IRS audit about IRS problems many years after they have occurred. against, but because of the schedule for your home or office should be This causes the amount owed to the IRS to be substan- Federal Tax Lien, they taken more seriously due to the fact that the tially greater due to penalties and interest. cannot get a loan. IRS Auditor is a Revenue Agent. All IRS audits should be taken seriously because they often lead to other tax years and other tax deductions INNOCENT AND INJURED not originally stated in the audit letter. SPOUSES If you sign a joint return, the IRS may be able to collect IRS LEVY any tax relating to that return from you - even if your An IRS levy is the actual action taken by the IRS I R S S E I Z U R E S spouse was the one who reported incorrectly. However, to collect taxes. For example, the IRS can issue a The IRS has extension powers when it comes to you may qualify for relief. bank levy to obtain your cash in savings and Seizure of Assets. These powers allow them to checking accounts or the IRS can levy your wages seize personal and business assets to pay off You may be eligible for Innocent Spouse relief if you or accounts receivable. When the IRS levies a outstanding tax liabilities. This occurs when meet the following conditions: bank account, the levy is only for the particular taxpayers have been avoiding the IRS. The IRS ♦ You filed a joint return on which there was an un- day the levy is received by the bank. The bank is derstatement of tax due to an erroneous item relat- attempts to collect amounts owed with a seizure ing to your spouse. required to remove whatever amount is available as the ultimate act of their collection efforts. to your account (up to the amount of the IRS levy) ♦ You didn't know, and had no reason to know, about the understatement when you signed the return. It and send it to the IRS in 21 days unless notified WAGE GARNISHMENT would be unfair to make you pay the tax otherwise by the IRS. This type of levy does not The IRS wage garnishment is a very powerful effect any future deposits made into your bank Innocent Spouse relief may be available even if you're tool used to collect taxes owed through your account after the 21 days unless the IRS issues still marred to, and living with, the spouse who should employer. Once a wage garnishment is filed another bank account levy. An IRS wage levy is have reported the additional tax. with an employer, the employer is required to different. Wage levies are filed with your em- collect a large percentage of each paycheck. If you have an unpaid tax bill from prior years, the IRS ployer and remain in effect until the IRS notifies The paycheck that would have otherwise been can keep your refund for the current year as a payment the employer that the wage levy has been released. paid to the employee, instead will now be paid on that liability. Your refund can be applied against un- Most wage levies take so much money from the to the IRS. The wage garnishment stays in ef- paid child support, spousal support and student loans. If taxpayers' paycheck that the taxpayer doesn't have fect until the IRS is fully paid or until the IRS the IRS has applied your share of a refund against a li- enough money to live on. ability owed by your spouse, you're an Injured Spouse agrees to release the garnishment. entitled to relief. About Community Legal Community Legal Services of Mid-Florida Community Services of Mid-Florida, Inc. Our mission is to provide access to justice Legal BREVARD — (866) 469-7444 through high quality legal assistance to low-income persons. Services of CITRUS & SUMTER Community Legal Services of Mid-Florida, 106 N. Osceola Ave. Mid-Florida Inc. provides free legal assistance to eligi- Inverness, FL 34450 ble low-income persons in civil matters (352) 726-6592 — CITRUS (we do not offer legal assistance in crimi- nal or traffic matters). (800) 984-2918 — SUMTER UNDERSTANDING We also provide community educational FLAGLER—(800) 405-1417 IRS PUTNAM—(386) 385-0928 seminars and brochures regarding the 216 S. 6th St., Palatka, FL 32177 major areas of law we practice. Although the LITC receives funding from HERNANDO — (866) 801-5566 the IRS, the clinic and its employees are not affiliated with the IRS. A taxpayer’s LAKE— (352) 343-6351 decision to use the LITC will not affect the 226 West Main St., Tavares, FL 32778 taxpayer’s rights before the IRS MARION— (352) 629-6257 2300 SE 17th St, Ocala, FL 34474 Client toll-free number: ORANGE — (407) 841-7777 122 E. Colonial Drive, Suite 200 Orlando, FL 32801 Low-Income Taxpayer Clinic (LITC) OSCEOLA — (407) 847-0053 800 North Main St., Kissimmee, FL 34744 Client toll-free number: SEMINOLE — (407) 322-6673 (866) 886 -1799 315 Magnolia Ave., Sanford, FL 32771 www.clsmf.org (866) 886 -1799 www.clsmf.org VOLUSIA — (386) 258-5600 PLEASE NOTE: WE DO NOT ASSIST 128 Orange Ave., Suite 100 WITH TAX PREPARATION UNLESS The Florida Bar Foundation, Daytona Beach, FL 32114 THERE IS AN UNDERLYING ISSUE THAT with Interest on Trust Accounts Client Toll Free Number: 1-800-363-2357 REQUIRES TAX PREPARATION AND program funding, provides support for this service. ADMINISTRATIVE OFFICE: 1-386-506-5396 FILING firstname.lastname@example.org 10/11 T-19 www.clsmf.org
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