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IRS Tax Reduction & Settlement

Unfiled Tax Returns: The 1ST Step To Reducing & Settling Your IRS Tax Debt

Unfiled Tax Returns may be construed as a criminal act by the IRS. The IRS may view you as a "Tax Protester". Is that how you want the IRS to view you?

It doesn’t matter what your occupation is. Whether you are a W-2 or a 1099 the Tax Professionals at FLAT FEE TAX SERVICE will be able to manage your Tax Debt problem and prepare your Delinquent and Unfiled Tax Returns.

FLAT FEE TAX SERVICE will prepare your Unfiled Tax Returns and help you take the 1st step in reducing and resolving your Tax Debt.

Don’t wait for the IRS to find you as the cost of additional IRS Tax Penalties will grow rapidly. If the IRS finds you before you have filed your past-due returns, the likelihood of criminal prosecution escalates and the odds that the IRS will Execute an IRS Wage Levy/IRS Wage Garnishment upon you is ever more likely.

The IRS has a wide range of civil and criminal penalties available that they can impose on you if you have Unfiled Tax Returns. Intentionally not filing, or filing a false return, is a federal crime.

You need to act immediately to resolve your unfiled tax returns before a simple mistake becomes a crime or the IRS takes most of your paycheck, your Social Security or your Social Security Disability (SSDI) leaving you without enough money to pay for rent, food, etc.

The IRS estimates that approximately 10 million taxpayers fail to submit their unfiled tax return(s) each year. A delinquent unfiled tax return is often more closely examined by the IRS. When filing a delinquent and unfiled tax return it is important to move quickly and correctly, and to follow IRS guidelines for "voluntary compliance."

The IRS created a joint task force of revenue agents and Tax auditors from the IRS Examination Division, Revenue Officers from the Collection Division, and Special Agents from the Criminal Investigation Division to locate non-filers and secure compliance with filing requirements. The IRS has substantially increased its budget for technology that will enable it to find and pursue taxpayers who fail to regularly file their tax returns.

The IRS will find you through ACS (Automated Collection System) and proceed to Execute an IRS Wage garnishment / IRS Wage Levy or Execute a Levy on your Bank Account and bring you to your knees financially.

Computers are getting more powerful all the time and in this day and age it isn't difficult for the IRS to find you. The IRS Information Reporting System (IRP) is a multi-task system and contains a subsystem aimed at the discovery of under-reporting of income as well as taxpayers who have not filed their required tax returns. This subsystem is the backbone of the IRS effort to identify and locate non-filers.

If you have not filed all required tax returns, and have not yet been discovered by the IRS, the time to act is now. If you fail to act now, the IRS is almost certain to knock on your door in the future. Make no mistake about it, the IRS will take your wages/paycheck.

The IRS will seize your paycheck, your Social Security, your SSDI and/or your Bank Accounts.

Criminal penalties for willful failure to timely file tax returns or pay taxes are mentioned at 26 U.S.C. § 7203: Any person required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a income tax return, keep any records, or supply any information, who willfully fails to pay such estimated tax or tax, make such income tax return, keep such records, or supply such information, at the time or times required by law or regulations, shall, in addition to other penalties provided by law, be guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $25,000 ($100,000 in the case of a corporation), or imprisoned not more than 1 year, or both, together with the costs of prosecution.

Failure-To-File Penalty

If you don't file by the due date, which includes extensions, you may have to pay a failure-to-file penalty. The penalty is 5% of the tax not paid by the due date for each month or part of a month that the return is late. The maximum penalty is 25% of your tax, but it is reduced by the failure-to-pay penalty for any month in which both penalties apply. You will not have to pay the penalty if you can show "reasonable cause" for not filing on time. If your failure to file is due to fraud, the penalty is increased to 15% for each month or part of a month that your return is late, to a maximum of 75%.

THERE IS ALSO INTEREST ON TOP OF THE PENALTIES.

Accuracy-Related Penalty

An accuracy-related penalty of 20% applies to any underpayment due to:

• Negligence or disregard of rules or regulations, or
• Substantial understatement of income tax.

Negligence or Disregard

The term "negligence" includes a failure to make a reasonable attempt to comply with the tax law or to exercise ordinary and reasonable care in preparing a return. Negligence also includes failure to keep adequate books and records. You will not have to pay a negligence penalty if you have a reasonable basis for a position.

The term "disregard" includes any careless, reckless, or intentional disregard. The penalty is based on the part of the underpayment due to negligence or disregard of rules or regulations, not on the entire underpayment on the return.

Substitute for Return (SFR)

The IRS may have filed SFR's (Substitute For Return). Most people we speak with think that an SFR is a tax filing. No, it is not a real tax filing. SFR's are the "assessment" needed in order for the IRS to file Federal Tax Liens and Execute an IRS Wage Levy/IRS Wage Garnishment and/or an IRS Bank Levy, The IRS will show you no mercy if you have unfiled tax returns.

You may be hit with an IRS Wage Garnishment at any moment.

Substitute For Returns (SFRs) are prepared and filed pursuant to authority granted the Internal Revenue Service by IRC §6020(b) which authorizes the IRS to prepare an individual income tax return on behalf of the taxpayer. In most cases, the Automated Substitute for Return (ASFR) system is used to evaluate the IRS Master File (MF) information about the taxpayer, and prepare an SFR for a wage earner or taxpayer without other unresolved taxpayer delinquent accounts (TDAs). .

A Substitute for Return (SFR) is put together by the IRS based on their best guess of what the IRS believes your income was for a given tax year. The IRS will figure in cost of living wage increases and other factors to estimate how much you make and, by extension, how much you owe in back taxes. The IRS will add all relevant fees, penalties, and interest to grow what you owe into a substantial tax debt. .

More Consequences of Not Filing Past-Due Returns

If you fail to file a tax return, the IRS has the ability to paralyze you financially. They can keep you from obtaining student loans, buying a house, refinancing a house, or getting credit from most lenders and credit card companies until you pay all delinquent taxes.

The IRS can seize available cash from your bank accounts, Social Security and Disability (SSDI) income at a time when you can least afford to lose it.

Also understand that certain federal and state benefits, like Social Security and Medicare, are available only if you file federal tax returns. Because benefits from these two programs are based on your lifetime income, the agencies depend on information in your tax returns to calculate your entitlements. If you don't file federal tax returns, you can cheat yourself out of prolonged federal benefits. Some state benefits like unemployment compensation are also based on income reported on your tax returns.

Examination Actions Phase Legal Responses

"Examination" is the IRS term for audit. if the IRS does not receive (1040) your tax return(s) in response to the requests above, it typically generates a Substitute for Return (SFR), for each year under investigation.

Somewhere around 2002 or 2003, or perhaps a bit earlier, the IRS began an automated SFR process. Now, rather than filling out and filing a blank, unsigned tax return, an IRS technician enters a SFR 150 transaction code into the IMF so that a tax year module can be opened "to facilitate" the assessment of taxes. Now there is no "tax return" at all issued under the authority of IRC 6020(b). Instead, the IRS now makes an IRC6020(b) certification "certifying" that the documents which are part of its proposed assessment "constitute" a tax return under IRC 6020(b), but the underlying statute has not changed, and no signed 1040 has been made.

The Proposed Assessment ("30-day letter"): The IRS "audit" of a non-existent "tax return" (SFR) results in a "deficiency." A IRS Form 4549 is generated to show the proposed assessment resulting from the claimed "deficiency" and a 30-day letter is sent with the IRS Form 4549 and IRS Form 886-A. This IRS letter, if responded to generally within 30 days, allowed for a person to ask for a reconsideration of the audit through the IRS appeals office. it is discretionary on the part of the IRS to forward the request to the appeals office, and for the appeals office to grant a hearing. (The Proposed Assessment letter is not required by the law to be sent, so it is not always used by the IRS).

If the IRS discovers a habitual non-filer before voluntary disclosure, either through its own non-filer programs or through an informant, the IRS will often refer the matter to the Criminal Investigation Division (CID) to determine if criminal prosecution is warranted. The IRS has devoted substantial resources to identifying non-filers.

The IRS will not enter into any payment agreement or enter into tax settlement until you are Compliant and have filed all delinquent tax returns.

In many cases, if a taxpayer seeks to correct the problem before an IRS investigation or examination, it is possible to use the IRS’s "voluntary disclosure" policy to file missing returns and avoid prosecution. In connection with the voluntary compliance program, the taxpayer must be careful to file returns that are accurate and truthful. If the IRS determines that late-filed returns are false, the chances of criminal prosecution increase tremendously. The IRS’s voluntary disclosure policy applies to a taxpayer who:

• Voluntarily informs the IRS of his failure to file for one or more years
• Had income from only legal sources
• Makes the disclosure prior to being informed that he is under criminal investigation
• Files a correct tax return or cooperates with the IRS in ascertaining his correct tax liability

Do you have Unfiled Tax Returns?

NOW IS THE TIME TO GET YOUR SELF STRAIGHT WITH THE IRS. CALL FLAT FEE TAX SERVICE NOW!

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