Be Prepared: Most people learn more from their mistakes. But you don't want to make a mistake when it comes to IRS Issues. Here are three key things you should NEVER do when handling your IRS Tax Issues.
1. Get to it “Later”
Procrastination will drain your bank account. The IRS adds interest and penalties for every month your IRS Debt goes unpaid. Put it off long enough, and the IRS will be forced to use their collection methods against you. That's right, the infamous IRS Liens, Levies, and Seizures
2. Fail to Proofread
Even tiny mistakes can cost you big when it comes to IRS Issues. For example, when you submit Form 656 “Offer in Compromise” you have to pay a $150 dollar application fee. If you make a mistake the $150 is nonrefundable! Double check every section of an IRS document before you submit it! Common errors include:
-Leaving questions blank
-Not including supporting documents with forms
-Omitted your signature where needed
3. Neglect to File
Every year people refuse to file their taxes. They rationalize, “I can't pay my taxes this year, so I shouldn't file!” Bad idea. Failure to file is illegal. And although few people are thrown in jail, the maximum sentence you can face for failing to file your taxes is 3 years. If you are taken to court for failure to file, you will be held responsible for court and Attorney fees. If that doesn't convince you, check out some more reasons why you MUST file every year:
-Late filing penalties and interest will make your debt skyrocket out of control
-You will not qualify for Penalty Abatement or an Offer in Compromise if you're not current with your tax filing
-You can lose your promotion, or your job, for not being up-to-date with tax filings.
Final Tip: What will happen if you're already guilty of one or all three of these deadly offenses? It's never too late to fix your tax debt issues, just follow step one and get to it NOW.
Labels: Penalty Abatement