Tax FAQs

We’ve worked hard to come up with a list of pos­si­ble Tax FAQs (Fre­quently Asked Ques­tions) the pub­lic might have.

Just click on the ques­tions to view the answers. If you do not find the ques­tion you have or if you still need addi­tional infor­ma­tion, please con­tact us.

Can I pay my tax debt through install­ment monthly payments?

Yes. If you owe $25,000.00 or below, you are enti­tled to a “stream­line pro­gram” install­ment agree­ment. For debts over $25,000.00, you have to pro­duce finan­cial proof and infor­ma­tion before an install­ment agree­ment is reached.

If an IRS agent shows up at my home or place of busi­ness, what shall I do?

To stop the agent from ask­ing you ques­tions, tell the agent that you have an attor­ney or an enrolled agent rep­re­sent­ing you. The agent should imme­di­ately cease ask­ing questions.

If I can­not pay the full amount of the tax debt, can I offer a lower amount to pay it off?

Yes you can under cer­tain con­di­tions. This is what is called Offer in Com­pro­mise (OIC) where

If I did not file and there­fore did not pay my tax, what is the penalty?

In gen­eral, the com­bined penalty is 5 per­cent (4.5% late fil­ing, 0.5% late pay­ment) for each month, or part of a month, that your return was late, up to 25%.

If I don’t file my tax return on time and file it late, is there a penalty? If so, what is the rate?

Answer: The late pay­ment penalty is one-half of one per­cent of the tax (0.5%) owed for each month, or part of a month, that the tax remains unpaid after the due date, not exceed­ing 25 per­cent (25%).

If I file on time and owe taxes on my return and do not pay, what is the penalty?

The penalty is equal to one-half of one per­cent (1%) of the bal­ance of each month that the tax shown on the return is not paid, not to exceed twenty-five per­cent (25%) in the aggregate.

If some­one calls me on the tele­phone and the caller indi­cates that he or she is an agent of the IRS or any tax­ing agency, how do I deal with it?

Keep calm and request for the caller’s name, ID num­ber and tele­phone num­ber. Any agent from the IRS or the state are oblig­ated to pro­vide their infor­ma­tion even when not asked. If the caller refuses to give infor­ma­tion when you asked for it, hang up the telephone.

Is there an exception?

Yes. If you can show rea­son­able cause for not fil­ing your taxes on time.

Will the IRS levy my bank account or wage after a tax assess­ment is made?

Not imme­di­ately. After you are assessed with a tax debt, you are going to be sub­jected to a col­lec­tion action.