KY-2021-02, IRS announces tax relief for Kentucky victims of severe storms, straight-line winds, flooding and tornadoes
Some requests for penalty relief may be made over the telephone. Please call us at the number located at the top of your letter or notice. This information should be available when you call us:
Benefits.govBenefits.gov wants to let survivors and disaster relief workers know about the many disaster relief programs available. Maybe you've suffered severe damage to your home or business, lost a job, or seen crop damage from a natural catastrophe. Benefits.gov provides a wide range of assistance and benefit programs that can be used to help with disaster recovery.
Families in Puerto Rico that are eligible can claim the credit by filing a federal return, even if they do not normally file or have very little income.
The amount of disposable income that must go into the offer amount cannot exceed the following: the number months until the Collection Statute Extension Date (CSED), which refers to the date of tax debt, or 6 or 24 months depending on the payment option chosen by the applicant for OIC.
According to the IRS, the Offer in Compromise program is not appropriate for everyone. Before submitting an Offer of Compromise, the IRS recommends that taxpayers investigate all payment options.
If you are unable to comply with tax laws due to circumstances beyond the control of your company, you may be eligible for penalty relief.
The IRS issued Notice 2022–36PDF to help the COVID-19 affected taxpayers. It offers penalty relief to all people and businesses who late file certain 2019 and 2020 returns. The IRS also offers assistance to those who have already paid the penalties. To be eligible, you must file your tax returns by September 30, 2022. For more information on this relief, refer to this IRS news release.
All taxpayers have access to IRS.gov for important information. Many taxpayers who want payment plans, including Installment Agreements can apply online at IRS.gov.
Offer to pay one lump sum payment. The initial payment should be equal to 20% of the offer amount. If you have been notified via mail that your offer was accepted, the balance must be paid in five installments or less.
OIC (or Offer In Compromise) is an Internal Revenue Service program that allows tax-debtor eligible individuals to negotiate a smaller amount than the total amount due to clear their debt. The Offer in Compromis Package, Form 656, includes a checklist that determines if the taxpayer qualifies to participate in the offer-in compromise program. OIC programs encourage voluntary compliance in future filing requirements.
As a result, nearly 1.6 million taxpayers who already paid the penalty are receiving refunds totaling more than $1.2 billion. Most eligible taxpayers will receive their refunds by the end of September.
See Penalty Appeal Eligibility to learn the next steps if you received a notification or letter that we have denied your request.
Penalty relief is not available in some situations, such as where a fraudulent return was filed, where the penalties are part of an accepted offer in compromise or a closing agreement, or where the penalties were finally determined by a court. For details, see Notice 2022-36, available on IRS.gov.
This article explains the steps that IRS might take to recover taxes owed. Publication 594: The IRS Collection ProcedurePDF
Professor Stearns strongly recommends that you do not file on your behalf. An OIC can be obtained free of charge by a Low Income Taxpayer clinic, provided your income is eligible. There are 135 federally supported clinics all across the United States. Each state has at least one clinic, with the exception of North Dakota.
More bad news is that the IRS will not allow you to count private school expenses as charitable contributions or voluntary retirement contributions.
The Infrastructure Investment and Jobs Act (enacted November 15, 2021) amended section 3134 to the Internal Revenue Code. This limits the Employee Retention Credit to wages paid prior to October 1, 2021 unless the employer has a recovery-start business.
Those who still have the right to claim the credit may want to review the history of the credit since it was enacted by CARES Act. The Employee Retention Credit – 2020 vs. 2030 Comparison Chart shows the eligibility requirements. This chart was updated by the Relief Act of 2000 and then the American Rescue Plan Act of 2010.
The IRS is collecting $100,000 in back taxes. The money isn’t there. The feds could garnish your wages and seize your home.
If you wish to file an appeal, complete IRS Form 3711, Request of Appeal Of Offer In Compromise. If the following statements are true, you will not be allowed to appeal a rejected compromise offer.