Ohio Man Bulldozes $350K Home to Avoid IRS Action

Terry Hoskins resorted to extreme measures when he bulldozed his $350,000 home to keep a bank from foreclosing on it. According to Terry, he strugged with his bank over his home for years and had ongoing problems with the IRS.

He claims the IRS place liens on his carpet business and commercial property and the bank claimed his house as collateral.

Terry claims that he owes $160,000 on the house. He tried to sell it, but the bank said they would make more money for forclosing on it. He has already spent a lot of money on attorneys, and he had enough. He went to drastic measures and bulldozed his home.

Avoid Drastic Measures: Is this dramatic move going to put Terry Hoskins in a better position with the IRS? Definitely not. There was still hope to negotiate for his property. if you ever feel as desperate as Terry, expensive, dramatic moves like this will not help. Continue to work with professionals. Sometimes, it may seem grueling and take forever, but there's light at the end of the tunnel.

Options to pay the IRS and Get Rid of IRS Tax Debt for Good- Try an Installment Agreement

If you owe the IRS, there’s no time to lose. If you call the IRS directly you’ll learn they only want to talk about one thing, and that’s how soon you can pay in full. But that’s not your only option. You can pay the IRS in monthly installments or in partial payments.

IRS Streamlined Installment Agreement
If you owe less than $25,000 and do not want the IRS digging into your finances, this may be the best option for you.They base your monthly payment on what would be required to pay your debt in full in five years. In order to apply fill out IRS Form 9465, Installment Agreement Request.

IRS Voluntary Disclosure Installment Agreement
If you owe more than $25,000 or cannot afford to pay the amount offered by the streamlined agreement, you will need to disclose your finances with a Form 433. You could wind up with a very affordable payment plan, but if your form is filled out incorrectly you may pay much more than you truly have monthly. Trust me, defaulting on an IRS payment plan is not something you want to do. This is why I recommend people turn to a tax debt professional to make sure they get the best payment plan for their budget. 

IRS Partial Payment Installment Agreement
In a Partial Payment Installment Agreement, the taxpayer makes regular monthly payments to the IRS, but the payments do not pay off the tax debt in full like the other two Installment Agreements do. You make the same affordable payments each month, until your debt expires according to its statute of limitations. Any debt left over is no longer collected upon by the IRS. Although requesting a Partial Payment Installment Agreement with the IRS is trickier than the other two. First, you need to write a letter stating your request for a Partial Payment Installment Agreement and submit it to the IRS along with IRS Form 9465 and IRS Form 433. Again, I suggest that you hire a tax debt professional to help with this.

IRS Statements on the Austin Plane Crash

The IRS commissioner had the following to say about the tragic Austin Plane Crash:

Like most Americans, I am shocked by the tragic events that took place in Austin this morning. This incident is of deep concern to me. We are working with law-enforcement agencies to fully investigate the events that led up to this plane crash.

My thoughts and prayers go out to the dedicated employees of the IRS who work in the Austin building. We will immediately begin doing whatever we can to help them during this difficult time.

While this appears to be an isolated incident, the safety of our employees is my highest priority. We will continue to do whatever is needed to ensure our employees are safe.

The IRS also wanted to let Taxpayers know the following:


In light of the recent Austin tragedy, the IRS wants to reassure Americans that this incident will not affect filing season activities, including tax return processing.

The IRS does not process tax returns or issue refunds at the Echelon 1 Building at 9430 Research Blvd.in Austin, Texas.

During this time, our dedicated workforce continues the work of the IRS, which includes helping taxpayers, processing tax returns and issuing refunds as quickly as possible.

Increasing Security: Threats to the IRS are at an all-time high this tax filing season. The IRS is taking extra measure to ensure the safety of their employees.

IRS Plane Crash, Man Bulldozes Home, and Inmates Scam IRS out of $1 Million!

IRS News of the Weird: This Tax Season has bought on the wildest Tax Schemes and dramatic Tax Events in recent history. Joe Stack, sick of the IRS, flew his small plane into an IRS Building; Terry Hoskins bulldozed his home to the ground to prevent the IRS from seizing it, and inmates in a Florida prison managed to scam the IRS out of $1 Million.

Joe Stack and the IRS Plane Crash

Joe Stack, A software engineer furious with the IRS,  plowed his small plane into an office building housing nearly 200 federal tax employees on February 11, 2010. The crash has injured many and killed one person. The terrorist attack was politically motivated. In his suicide note, Joe Stack attacks the IRS stating that he was outraged at loopholes that benefit large corporations and the Catholic Church, but not average Americans. He claimed that the IRS cost him "$40,000+, 10 years of my life, and set my retirement plans back to 0."

Terry Hoskins Bulldozes his home to Prevent IRS Seizure

 In Ohio, Terry Hoskins stugged to keep the bank from closing on his $350,000 home. He has alreayd had problems with the IRS for years, with the IRS placing liens on his carpet store and commercial property. The bank claimed his house as collateral.

Terry Hoskins said he owes $160,000 on his home, but he had finally had enough of spending money on attorneys to save it.  “When I see I owe $160,000 on a home valued at $350,000, and someone decides they want to take it – no, I wasn’t going to stand for that, so I took it down,” Hoskins said.


Inmates in a Florida Jail make the IRS Their personal ATM

Detainees at a South Florida county jail are being accused of scamming the Internal Revenue Service by filing for fraudulent refunds and taking in as much as $100,000. About 50 inmates from the Stock Island Detention Center in Key West were allegedly involved.

The detainees allegedly used a standard IRS form to claim bogus refunds, filing for about $1 million in all. Most of the requested refunds were for about $5,000. Many checks were sent directly to the jail.
The scheme was discovered after a how-to note was found in an inmate's cell.

Lessons to learn: These dramatic events were completely unnecessary. There's no fighting the system, you come out the loser. There's no winning when you scam the IRS. You have to pay your taxes if you want to avoid IRS issues. Heed the warnings of these stories, file and pay your taxes on time to this year.

Top 10 Facts About Capital Gains and Losses

Capital gains and losses could have an impact on your tax return this year. For tax filing season, the IRS wants you to know these Top 10 Facts about Capital Gains and Losses and how they could affect your tax filing situation.

1. Almost everything you own and use for personal purposes, pleasure or investment is a capital asset.

2. When you sell a capital asset, the difference between the amount you sell it for and your basis – which is usually what you paid for it – is a capital gain or a capital loss.

3. You must report all capital gains.

4. You may deduct capital losses only on investment property, not on property held for personal use.

5. Capital gains and losses are classified as long-term or short-term, depending on how long you hold the property before you sell it. If you hold it more than one year, your capital gain or loss is long-term. If you hold it one year or less, your capital gain or loss is short-term.

6. If you have long-term gains in excess of your long-term losses, you have a net capital gain to the extent your net long-term capital gain is more than your net short-term capital loss, if any.

7. The tax rates that apply to net capital gain are generally lower than the tax rates that apply to other income. For 2009, the maximum capital gains rate for most people is15%. For lower-income individuals, the rate may be 0% on some or all of the net capital gain. Special types of net capital gain can be taxed at 25% or 28%.

8. If your capital losses exceed your capital gains, the excess can be deducted on your tax return and used to reduce other income, such as wages, up to an annual limit of $3,000, or $1,500 if you are married filing separately.

9. If your total net capital loss is more than the yearly limit on capital loss deductions, you can carry over the unused part to the next year and treat it as if you incurred it in that next year.  

10. How to Report: Capital gains and losses are reported on Schedule D, Capital Gains and Losses, and then transferred to line 13of Form 1040.

The Truth about IRS Installment Agreements

People think that just anyone can call up the IRS and ask for a cheap IRS Installment Agreement. This simply is not the truth. Sure, you can call up the IRS and do the work yourself. I have spoken to many people who put themselves into an IRS Installment Agreement themselves...and they are calling me because it is costing them too much a month. Often, they couldn't keep up and now the IRS is coming after them. The truth about IRS Installment Agreement is this. There are three basic types:

1. Streamlined IRS Installment Agreements
These do not require much. The only requirement is that your debt must be under $25,000. You fill out a simple form and you don't even have to give your financial information for review. The catch is that you must pay the full amount within 5 years and you are stuck with whatever monthly payment takes care of that. If you are temporarily in a financial bind, you can tier your payments so that you pay lower amounts the first year.

2. Voluntary Disclosure IRS Installment Agreements
 If you owe more than $25,000 or the streamlined agreement doesn't work out for you, then you have to disclose your finances. Your payments will be based on what you can afford to send the IRS every month. People...the IRS is not your friend. They're going to view what you can really afford differently from you...unless you get help from a tax debt professional. You really need to know tax law if you want to win this kind of battle with the IRS. The IRS instructions on how to fill out 433 forms is NOT going to cut it.

3. Partial Payment Installment Agreements
Normally, you have to make sure your tax debt is paid before it expires with the Statute of Limitations. But, what if that's in two years and you can't afford the payments required to pay it off by then? You definitely need a tax debt professional for this. You need someone who is going to defend your right to live a normal life. I don't know of anyone who has successfully gotten a partial payment installment agreement without help from a reputable tax debt professional.

So, there you have it. That's the truth about installment agreements. Just like you can do car repairs yourself. Sure, you can try it on your own. But, honestly; you'll save time, money, and hard ache hiring a tax debt professional.  

Call 888-391-2037 or fill out the submission form now to get the right IRS Installment Agreement for you.

Settle Your Tax Debt: See if you Qualify for an Offer in Compromise

Settle Down: If you have a tax debt and are in need of settling, you have a few options available to you. Most taxpayers are not able to pay off their debt in full. If this is your case, and you are unable to pay the IRS through an Installment Agreement, an Offer in Compromise (OIC) may be your best choice.

Last Resort: An Offer in Compromise is an agreement between you and the IRS that resolves tax debt by settling or compromising for less than full payment. An OIC is only considered after all other payment options have been exhausted. This means that you have sorted through the requirements of the other plans and find that you don’t qualify, or you can’t make the payments.

The Choice is Yours: Initiating the process, filing accompanying forms, and paying the $150 application fee are entirely up to you. It’s in your hands and it’s not easy. Acceptance into the program is stringent; the IRS resolves very little of the cases this way so it’s important that if you are applying for the program, you are sure it is one of your final options. Otherwise you could end up wasting time, and money.

The Equation: Basically an OIC is your ability to pay vs. the IRS’ ability to collect.
Ask yourself this question: if the IRS were to take everything from you (your wages, your assets, etc.) would that satisfy the debt? If the answer is no then you may just qualify. However, keep in mind that the IRS has a very specific formula for determining your ability to pay.

Big Picture: The entire process of an OIC may take up to two years just to get accepted. Remember that approximately 83% of Offer in Compromise cases are rejected by the IRS. Speak to a tax professional and make sure that you can qualify; otherwise you may be wasting your time. Make sure the time and effort are worth it, and the hard work will be rewarding when you reap the savings.

The Top 3 Tax Forms That Will Save You Money

Knowledge is Power it sounds corny, but it's true. Most people don't have a clue when it comes to IRS rules and regulations. And naturally, few people have knowledge of the countless forms and documents the IRS requires taxpayers to fill out. So get out your pen and take notes, the more you know about the IRS the better.

The Top 3 Forms: These are the top 3 most requested IRS Forms according to the IRS.

1. Form W-9 Request for Taxpayer Identification Number and Certification
Form Purpose: Use this to retrieve your Taxpayer Identification Number (ITIN)

How it Saves You Money: Failure to Furnish your correct ITIN to a requester can result in a $50 penalty.

If you provide a false ITIN number with no reasonable basis to back you up, you may receive a whopping $500 penalty! Misuse of ITINs or falsifying information can result in civil and criminal penalties.

2. Form W-4
Form Purpose: This form lets your employer withhold the correct Federal Income Tax from your pay.

How it Saves You Money: Be honest with yourself. If your employer doesn't withhold your taxes, will you take the initiative and withhold the taxes from your income? Probably not. And if the IRS doesn't get their cut, you could end up with a massive debt. If you have not filled out a W-4 form yet, let your boss know you need one A.S.A.P!

3. Form 1040 U.S Individual Income Tax Return
Form Purpose: Use this form to report your annual income to the IRS, as well as your annual deductions.

How it Saves You Money: You need Form 1040 to receive your tax returns and itemize deductions. If you do not turn in Form 1040 and/or Form 1040 A annually you will be fined and penalized. This is one of the most important IRS Forms.

Why it's important: The IRS has to handle thousands of taxpayer's issues annually. The IRS is not designed for “customer service,” they are not going to patiently handle your issue for you. That means it's your responsibility to request information and handle your account. Knowing what forms to request is a huge step in the right direction.

The Top 3 Tax Relief Plans When You Know You Don't Owe

I’m INNOCENT, I tell ya! Is the IRS banging your door down, and sending threatening letters when you know you don’t owe? You’re not alone. I talk with dozens of people daily that believe they don’t owe the IRS.

The Straight Answer: From my personal experience, only 2% of taxpayers who claim they don’t owe actually have a case against the IRS. If you want to stand a chance, get out your pen and paper and take some notes.

Tops Plans When You Don't Owe the IRS

Innocent Spouse: If your spouse is to blame for your debt, you can try to move the blame to them. This will work in some cases, but there’s a strict set of rules that must be adhered to. For example, if you signed the tax return with your name on it, you’re responsible for that debt. Even if you didn’t access it! So make sure you read the returns before you sign them.

Equitable Relief: If the client does not qualify for innocent spouse relief, the IRS will look to see what other equitable relief the taxpayer may qualify for. It’s hard to qualify for equitable relief, but the following two factors can weight in your favor:

-Whether your spouse (or former spouse) abused you
-Whether you were in poor mental health on the date you signed the return (or at the time you requested relief.)

Amended Tax Return: An Amended Tax Return can be used to prove the validity of a Tax Debt. For example, if you need to prove your tax deductions are justified, you might file an Amended Tax Return with documentation attached to prove your innocence. You’ll need your original tax return to file an amended one, because the IRS won’t always have it on file.

Proving your innocence: It’s incredibly difficult to prove you’re innocent of the tax charges accessed against you at any point during the collections process. The IRS is rarely wrong about these things, but it’s possible that you’re one of the few that slipped through the cracks. If you need to prove you’re innocent, I highly recommend working with a tax relief company or reputable tax attorney.

Fraud Alert: Watch out for this IRS E-mail Scam

I was back at the Hitman Headquarters, answering distress signals (e-mails) from taxpayers in need. When all of the sudden, I run into this e-mail:

This e-mail is NOT from the IRS. If you see it in your inbox, do not reply. Simply delete it. The IRS has gone on the record more than once to say that they will never send e-mails directly to you. If the e-mail claims to be from the IRS, it's a scam attempt to collect your personal information.

Be careful, and watch out for scammers this tax season!

The Tax Kid's Latest Video

Tax Defense Network's The Tax Kids have made a new video. Check it out above!

The Tax Kids are dedicated to spreading the word about Tax Issues and making serious issues easier to understand. You can check out their official YouTube Channel here.

IRS Attack: Fight Back Against the IRS Machine

The Last and the Worst: Most people don’t put the IRS at the top of their priority list and here’s why: If you don’t pay your electric bill, they cut off your power. If you don’t pay your car insurance, they terminate the policy. You could go years without hearing anything from the Federal Government. So why worry right? Wrong! The thing that separates the IRS from every other collection agency in the world is that when they come, they come hard!

Round One! So you haven’t filed in the last few years. You’ve probably gotten a couple of letters from the IRS, asking about your debt. Now you find yourself holding a letter that says Final Notice. While this may not seem important at the time, you’d better pay attention! That’s the IRS’ final warning before the onslaught begins. And trust me; you don’t want to be on the receiving end of an IRS attack. Here’s what they will do.

Levy – This tactic involves the IRS contacting your bank and having them set aside ALL of your funds currently available that day to send to the IRS. bank account and holding all funds. After 21 days, the bank HAS to send that money to the IRS. If you have direct deposit, you can kiss your paychecks goodbye. The worst part? Neither you nor your bank has any say in the matter.

Lien – A tax lien can be placed on your credit, meaning you can’t do anything that involves credit payment. This can ruin your credit score for many years! Eventually, these liens can turn into seizures, and the IRS sells your property in order to pay off the tax debt.

Wage Garnishment – This is the IRS' favorite, and probably the most effective. The IRS will contact your employer and start taking a percentage of your check in order to pay off the debt. They base what they leave you "live on" (I'm being very generous with this term...it's usually not enough for anyone to live on) by your filing status and number of allowable exemptions. If you're a 1099 worker, there's not much good news at all for you. You won't see a penny of that check.

Here’s What to Do: File your taxes! Even if you owe money, and you have to file an extension, make sure you file. The IRS can put you in jail if you don’t file, and the penalties are up to $50,000 per year not filed. If you know you’re not going to file on time, file for an extension. Contact with the IRS is extremely important. The IRS is not the collection agency to mess with.

Going at it Alone: An IRS debt can be a terrible situation. As an IRS Hitman, I know how brutal they can be. If you’re in a rough spot, and you’re losing hope, contact a tax professional. They have the knowledge and experience needed to get the IRS off your back. Fill out the form or call 888-391-2037 for immediate help!

Newly Wed Tax Filing Tips- Avoid Tax Troubles

Don't Pay Your Spouse's Tax Debt Whether you're planning a wedding, or you're newly married, you have a lot to learn in this arena. I'm not qualified to give marriage counseling, but here's some tips to help you avoid stress when tax time rolls around:

1. Name Change Drama: You're required to notify the Social Security Administration Report of your name change. Your name and your Social Security Number must match when you file your next Tax Return.

Here's what you do:
- File Form SS-5, Application for a Social Security card at your local SSA office. You can download the form from their website, www.socialsecurity.gov or you can call 800-722-1213.

2. Address Change: Moving in with the new spouse? You're required to notify the IRS when you change your address.

Here's what you do:
- Send Form 8822, Change or Address to to the IRS. You can download it at IRS.gov, or order it from 800-829-3676 (800-TAX-FORM).

-Don't forget to notify the U.S Postal Service so you can receive IRS correspondence. Don't try to avoid them, the IRS will find you.

-Don't forget to notify your Employer. Report your name and address changes to ensure that you'll receive receipt of your Form W-2 and your Wage and Tax Statement at the end of the year.

3. Check Your Withholding- You and your spouse's combined income could place you in a higher tax bracket. Double check your withholding to make sure the correct amount is being withheld for your filing status. The IRS has a convenient Withholding Calculator that will help you do this now.

Here's what to do:
-Go to IRS.gov and type "IRS Withholding Calculator" into the search bar

-Be prepared with your personal payroll and tax information to enter the information

The IRS Withholding Calculator will provide a new Form W-4, Employee's Withholding Allowance Certificate. Just print it out and give it to your payroll department so they will withhold the correct amount from each paycheck.

4. Don't Marry Tax Debt You can marry debt. Watch out if you're in one of the Community Property States, which include:

-Arizona
-California
-Idaho
-Louisiana
-Nevada
-New Mexico
-Texas
-Washington
-Wisconsin

If you live in any of the States, be careful who you marry. If they owe, YOU OWE. And nothing will turn your marriage into an episode of "Married with Children" faster than a shared tax debt issue. Here's some more scary facts:

-As long as you are legally married, the IRS can seize money and assets from YOU for your SPOUSE'S Debt.

-No Innocent Spouse Relief is allowed, the spouse is guilty by way of the state laws.

Scared yet? Make sure your spouse doesn't have a Tax Debt issue before you marry them. And if they don't want you to know it, why are you marrying them in the first place?

Final Tip- There are plenty of reasons to rethink marriage. You may have heard of "Innocent Spouse Relief" or "Equitable Relief" which relieves the "innocent spouse" from Tax Obligation. Well, if you signed the Tax Return for that Tax Year, you're guilty and it will take an act of congress to prove you're "innocent". Basically, it's your fault for signing without double checking all the information on the form! So read, research, and double check your joint Tax Returns before you sign on the dotted line!

Tax Audit Tips: Documents You'll Need to Stay Ahead

If the IRS doubts an expense you list on your tax returns, they'll ask for supporting documents. Many taxpayers e-mail me asking how they can get documentation for expenses for the IRS. Here's a quick refrence list:

How to get Documents for Common Allowable Expenses:

Rent/Mortgage: Show your monthly statement to the IRS. You can call your mortgage company or contact your land lord for this information.

Electric, Water/Sewer, Gas: Call your respective providers to obtain the statements for these expenses.

Prescriptions and Medical Equipment: Go to your pharmacy and ask for a print out.

Health and Life Insurance: Go to your payroll deparment at work and ask for a paystub or a Health Insurance prinout. If you aren't insured through work, call your insurance company and ask for a statement.

Day Care and/or Elderly Care: A Bank Statement will work if you're paying through debit or credit. Otherwise, request a letter from the care provider.

Alimony and Child Support: You can use pay stubs or divorce documents. Check with your lawyer on this.

Allowable Expenses: The list above covers all of the expenses the IRS will allow. Remember that credit card debt does not count as an allowable expense. If you owe the IRS, expect your credit account to fall into disrepair.

Get Organized: Lets face it, if you were organized, all of this information would be at hand, and you wouldn't have to frantically search for it when the IRS comes calling. I'm in the process of working on a FREE detailed tax and financial organizer that will be downloadable from the blog. Does anyone have any suggestions for this project? Let me know. And as always, feel free to send me an e-mail if you have more questions.

Everything About IRS Collection Statutes

Free at Last: Ten long years have passed since the IRS first discovered your Tax Debt. Somehow, you've made it this far without being levied, bullied, and laid to rest. But now the IRS can't collect from you anymore! Right?

Actually, They can.

Contrary to popular belief, the IRS can continue to collect after ten years have elapsed on your tax debt.

It Starts: The IRS ten-year statute of limitations period starts when the IRS officially determines you owe the debt. After ten years, your IRS case is closed and it becomes illegal for them to contact you regarding the debt. But there are several ways the Statue of limitations can be extended.

The following will extend the Statute of Limitations on your Tax Debt:

-Filing An Offer in Compromise

-Being in litigation with the IRS

-Request a Collection Due Process Hearing

But wait, there's more:

-Federal Lawsuit: If the IRS sues you the statutes can be extended

-Signing a Waiver: Signing a waiver might be required for things like setting up an Installment Agreement with the IRS.

The general rule of thumb is this, any action that puts your IRS Case on hold will extend the statutes. Otherwise, the IRS is losing years to collect their money.

And don't forget about Bankruptcy:

-Ch.7 Bankruptcy: this will extend the statues by 1 year on average

-Ch. 13 Bankruptcy: this will extend the statute of limitations by 5 years plus another 6 months for good measure!

Post Expiration: The IRS has been known to call individuals after their Statute of Limitations have expired. Most of the time, the taxpayer doesn't even know the statutes have expired! If you know you've been paying on your debt for years, double check to make sure you're not paying what you don't have to.

Offer in Compromise Facts and Tips

The Harsh Truth: The IRS wants the entire tax liability paid in full. After all, millions of Americans manage to do this every year, why shouldn’t you? The IRS will evaluate every single detail of your IRS case and situation before they even consider your offer. Here’s what you need to know before your submit an Offer in Compromise to the IRS.

• You don’t qualify: If you have the ability to pay the Tax Debt in full or pay it in monthly payments with an Installment Agreement, you don’t qualify for an Offer in Compromise. Even with special hardship circumstances, like unemployment, most people will not qualify for an Offer in Compromise.

• It’s not the best option: An Offer in Compromise isn’t for everyone. There’s a wide variety of ways to solve your Tax Debt issues, and you need to find the solution best suited to you. Sometimes an Installment Agreement is a better solution; it all depends on your situation.

• It'll cost ya: Depending on which Offer you submit, an application fee of $150 and 20% of the offer made must be submitted to the IRS. The money you send is nonrefundable! This means you’ll lose big if you’re not approved.

• Your Tax Lien is here to stay: Even if your Offer is approved, your Tax Lien remains until your Tax Debt is paid in full. According to the IRS, you have less incentive to finish paying your debt without the Tax Lien in place.

• Tax Levies are Finders, Keepers: The IRS will keep the proceeds from a levy served prior to submission of an Offer in Compromise. This means the money the IRS seized from your bank account prior to the OIC will not count towards the OIC, and the IRS is keeping it.

• No more refunds: No Tax Refunds will be received until the tax debt is paid in full. The IRS is letting you pay less than you owe, fair is fair, right?

• Collections statutes extended: The statutory period of your debt is suspected while the IRS investigates your Offer, and it’s further extended if you appeal an Offer in Compromise rejection. This will extend the amount of time the IRS has to collect on your tax debt. It’s a good idea to make sure you’ll be approved if you apply, the statute of limitations on your debt can be extended for years.

Ready to Apply? If you think you’re ready to take on the responsibilities of an Offer in Compromise, fill out IRS Booklet Form 655 Offer in Compromise. And remember to double check and proofread, the required $150 application fee and 20% of the offer is nonrefundable. A mistake could cost you big bucks, and lead to future levies and other IRS problems.

Extension of Time to File, Step by Step Guide

There's still plenty of time to file your Taxes before the deadline in April, but if you feel like you won't make it in time, it's possible to file for an extension to file your taxes. Here's the step-by-step guide:

Step One: Pull your head out the sand and get to work. There are more colorful ways to state this, but really, stop putting this off!

Step Two: File Form 4868 Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. (Available at IRS.gov)

Step Three: File this form by April 15, 2009. I’d recommend downloading the form and getting this out of the way NOW before your forget to do it later.

There you have it, three steps and it couldn’t be easier. But how do you know if you qualify? As always, I’ve got you covered:

Qualifying for an Extension of Time to File

To get extra time you must:

1. Properly estimate your 2008 tax liability using the information available to you
2. Enter your total tax liability on line 4 of Form 4868, and
3. File Form 4868 by the regular due date of your return.

Word of Caution: I’m not trying to mislead anyone. An Extension of time to File is not an Extension of Time to PAY taxes owed. No matter what, they’re due April 15th. If you do not pay on time you will be charged penalties and interest. Form 4868 does not extend the time to pay taxes.

If You Owe the IRS and you can’t pay by April 15th, I suggest getting in touch with a reputable tax professional or tax resolution company and discussing possible solutions. It’s vital to do this before you wind up with a huge debt on your hands.

Tax Filing Frequently Asked Questions

An IRS-Hitman Special: Tax time is around the corner. This is that special time of the year when my inbox get flooded with questions from worried taxpayers all across the Nation. It's time to give the people what they want, answers to their IRS Tax Filing questions!

What are the legal qualifications for filing jointly?
There's only one. The couple has to be legally married as of December 31 of that year.

Are any special return notations required when your are filing jointly, but your spouse is deceased?
Yes, there's a particular area of the paperwork you need to take note of. In the signature area write in "Filing as Surviving Spouse." The final return needs to have the word "Deceased," the decedent's name, and the date of death written across the top of the return.

What deductions can I safely take?
In the end, it's your decision. But ask yourself the following questions: Do you like taking risks that could land you into prison? Do you like taking risks that would make you pay hundreds or even thousands of dollars in fines? If you wouldn't rob a bank, don't rob the IRS. Those consequences I listed are the realities of getting too bold with your Tax Filing. It's best to get a professionals' opinion on this matter.

I haven't filed my taxes for a couple of years and the IRS says I owe them money. Do I have to file my missing years before the IRS will work with me on my debt?
Yes, you do have to file any Tax Returns from past years before the IRS will work with you. The plus side is that you only have to file missing returns for the last 7 years. And if you file your returns you may see your Tax Debt reduced.

Still Lost? Still have a tax question you need answered desperately? Don't worry, I'll be back next week to answer more of your questions. Until then, I hope everyone has a safe weekend!!

Top Tips for Choosing the Right Tax Preparer

Preparing taxes is a daunting task. And although it feels like they were just filed, it's time to take another look at filing taxes. Small Business owners have a limited amount of time to take advantage of some special deductions this tax year. That’s why many business owners choose to hire a Tax Preparer or Tax Professional to handle their Tax Filing needs. But choosing the wrong Tax Preparer can lead you to owe the IRS or even be the victim of IRS Audits, IRS Liens, or IRS Levies. Make sure you avoid these 3 Red Flags and ask good questions if you don’t want to end up with an Income Tax Problem on your hands.

Red Flags
Steer clear of any Tax Preparer that does the following:

• Your Tax Preparer refuses to answer questions: You don’t want to owe the IRS, don’t let a shifty Tax Preparer get away with evading your questions. You have a right to answers.

• Your Tax Preparer wants a cut of your Tax Refund: This almost guarantees that the Tax Preparer will do anything it takes to increase the amount of your refund, even going against IRS codes and policies. This can result in IRS Liens and Levies being filed against you.

• Your Tax Preparer Guarantees a Tax Refund or IRS Settlement: There are no guarantees with the IRS, especially when it comes to Tax Refunds or IRS Settlements.

Questions to Ask:

These questions are determined by the National Society of Accountants.

• What credentials do you have? You want to work with certified professionals with excellent track records for success.

• How long have you been in practice? Experience is an excellent indicator that you’re working with a trustworthy individual or company. Look for at least 10 years of experience.

• Have you ever dealt with tax situations like mine? You want to work with a Tax Preparer with a ride range of experience. They should know how to handle every IRS Lien, IRS Levy and any other IRS problem in-between.

• Are you the person who will be handling my return? It’s important to know who will be handling your Tax Issues. You need their name and contact information.

• What organizations do you belong to and do they have a code of ethics? You want your Tax Preparer to be a member of organizations like the Better Business Bureau that require companies and individuals to adhere to a strict set of ethics. Look for the highest ratings possible within these organizations.]

Final Tip: You don’t want to owe the IRS or risk an IRS Audit because you chose the wrong Tax Preparer. Remember, if choose the wrong Tax Preparer you can be held liable for all of the damages incurred.