Andrew Samaniego | Tax Resolution Blog | CA

Offer in Compromise

Your Ultimate Guide to Resolving Tax Debt

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Debt Deck Swabbers! It’s a refreshing morning here in San Diego, with the recent heat wave finally giving us a break. I’m outside enjoying some quality reading time, and speaking of reading, I’m thrilled to announce that my book, IRS Battle Plan: Guide to Winning Your Tax War, is just about ready to hit the shelves on Amazon and Kindle. This book isn’t just a collection of tips—it’s an essential survival guide for anyone navigating the treacherous waters of IRS troubles.

Why You Need a Battle Plan

If you’re dealing with back taxes, the IRS can seem like an unbeatable foe. But just like preparing for a weekend camping trip in the mountains, tackling IRS debt requires preparation, strategy, and the right tools. Whether you’re trying to stay out of trouble or find your way back from behind enemy lines, understanding the steps to resolve tax debt is your first order of business.

Step 1: Assess Your Situation

The first step in any good battle plan is to understand the terrain. In the case of tax debt, this means getting a clear picture of how much you owe and why. This could involve pulling up your IRS transcripts to see your account details, which include past due amounts, penalties, and interest charges.

Step 2: Consider Your Options

Once you know what you’re dealing with, it’s time to explore your options. Here are a few strategies that might be part of your plan:

  • Installment Agreement: This allows you to pay your debt over time.
  • Offer in Compromise: This is an agreement to settle your debt for less than the amount owed, if you can prove that paying the full amount is financially infeasible.
  • Currently Not Collectible Status: If you can prove that paying the debt would lead to financial hardship, the IRS may determine you’re not collectible, which stalls collection activities.

Step 3: Take Action

Knowing your options isn’t enough; you must take decisive action. This might involve filling out forms, submitting documentation, and perhaps most importantly, negotiating with the IRS. This is where having a seasoned Enrolled Agent can make a world of difference.

Step 4: Stay Compliant

After you’ve set your plan in motion, staying compliant is crucial. This means filing all future returns on time, making all required payments, and ensuring that you don’t fall back into the IRS radar for the wrong reasons.

Step 5: Equip Yourself with Knowledge

To successfully navigate these steps, you need knowledge, and that’s where IRS Battle Plan comes into play. It’s designed to be your handbook, your survival guide, and yes, your new best friend in the battle against tax debt.

Ready to Take Control?

If you’re ready to tackle your IRS debt head-on but aren’t sure where to start, scheduling an appointment with an Enrolled Agent specializing in tax resolution can be your best first step. Visit AndrewSamaniego.com to book a consultation. Together, we can review your situation, discuss your options, and start plotting your victory against the IRS.

Remember, like a well-planned camping trip, successfully resolving tax debt takes preparation, perseverance, and the right guide. Let’s get you equipped and ready to clear those tax hurdles and enjoy financial freedom!

Andrew Samaniego, EA, CTRC, MSCTA

Andrew Samaniego Tax Planning & Resolution

(619) 268-1084  |  AndrewSamaniego.com

Why You’re in the IRS’s Crosshairs and How to Escape

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Hope you all stayed cool this scorcher of a weekend in San Diego. My family and I ducked into the chill of a movie theater to catch the latest Marvel flick—Deadpool & Wolverine. Epic action, classic heroes, and, yup, a surprise comeback from Wesley Snipes as Blade! Speaking of comebacks, it reminds us of Snipes’ notorious battle with the IRS. He got nailed for not filing tax returns, ringing up a staggering $23.5 million in unpaid taxes. Post-prison, he tried to settle for pennies on the dollar, which the IRS swiftly booted. A tough lesson on how not to deal with tax debt.

Now, why am I bringing this up? Because it’s a perfect springboard into why you might find yourself in the IRS’s crosshairs and how you can smartly navigate out without ending up like Snipes.

You’re Not an Action Hero (At Least, Not to the IRS)

Here’s the deal: if you haven’t filed your taxes in over three years, you’re not just on the IRS’s radar—you’re practically under a microscope. And here’s why:

  1. Non-filing is a red flag. It screams, “Check me out!” to the IRS. And trust me, they will.
  2. The IRS has a long memory and a broad reach. They can and will catch up eventually. When they do, penalties, interest, and the original tax amounts can create a debt mountain that’s tough to scale.

How to Escape the IRS’s Grip

1. Start Filing NOW

First things first: get current. File those overdue returns ASAP. Yes, it’s daunting, especially if you’re looking at a stack of unfiled paperwork. But the longer you wait, the worse it gets. Each day adds up in penalties and interest. Bite the bullet and start digging out.

2. Know Your Settlement Options

Wesley Snipes tried to offer the IRS 4% of what he owed after his stint in prison—not the most persuasive offer. Learn from this: if you owe a ton and can’t pay up, you need to understand what settlement options realistically fit your situation:

  • Offer in Compromise (OIC): This allows you to settle your tax debts for less than the full amount owed if you can prove paying the full amount would create financial hardship. But remember, you need solid evidence to back up your claim.
  • Installment Agreement: This is often more attainable for the average Joe. You agree to pay off your debt monthly based on what you can afford after your living expenses are covered.

3. Consult a Tax Professional

This isn’t a DIY project. Tax laws are complex, and the stakes are high. A seasoned tax professional can provide crucial guidance and represent you in dealings with the IRS. They know the ins and outs of tax negotiation and can often secure terms that an individual taxpayer couldn’t on their own.

Conclusion

Just like in the movies, a dramatic IRS showdown can be thrilling but terrifying. The key difference? In real life, you want to avoid drama. Get ahead of your tax issues by taking action now, understanding your options, and seeking expert help. Don’t wait for the IRS to come knocking. Be proactive, and write your own comeback story—one where you settle your tax debts and walk away free, not one where you end up constrained by them.

Remember, in the battle against tax woes, knowledge is your superpower. Use it wisely, and keep your financial future secure. Anyone can be under the clutches of the IRS, and anybody can bounce back! Ready to start your comeback?

Andrew Samaniego, EA, CTRC, MSCTA

Andrew Samaniego Tax Planning & Resolution

(619) 268-1084  |  AndrewSamaniego.com

Navigating the Offer-in-Compromise Maze: More Than Just “Pennies on the Dollar”

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Before we dive into the murky waters of tax relief, let’s take a quick detour to something a bit more wholesome—my son, Kainalu, just had his 4-month checkup and has been cleared for another of life’s great adventures: eating solids! The little champ is gearing up for some serious gastronomic exploration, and let’s just say, his enthusiasm is something to behold.

Now, what does this have to do with taxes or an Offer in Compromise (OIC)? On the surface, nothing. But just like Kainalu’s steps toward eating solids, navigating the OIC process is about preparing for a significant shift, understanding the challenges ahead, and taking things one bite at a time.

What Exactly is an Offer in Compromise?

Let’s cut through the fluff. Despite what you might have heard, an OIC isn’t just some magical program where the IRS takes “pennies on the dollar” for your massive tax bill. It’s a legitimate but complex IRS program designed for taxpayers who are unable to pay their full tax liability, or doing so creates a financial hardship.

The OIC Maze: Knowing the Path

Navigating the OIC process can be likened to entering a maze. There are twists, turns, and you need a good sense of direction. Here’s how to start:

  1. Eligibility Check: First off, not everyone qualifies. The IRS considers your ability to pay, income, expenses, and asset equity. Just like Kainalu couldn’t jump straight to solids without a checkup, you can’t jump into an OIC without assessing your financial health.
  2. Documentation Galore: Prepare for paperwork—and lots of it. You’ll need to substantiate every detail of your financial life. This includes bank statements, pay stubs, vehicle information, and more. It’s about proving beyond doubt that you really can’t cough up what you owe in full.
  3. The Proposal: Submitting your offer is like laying your cards on the table. This is where you propose to the IRS what you can realistically pay. It’s a number that should reflect your true capacity to settle your debt, based on the financial documentation you’ve provided.
  4. Negotiation: Don’t expect the IRS to accept your first offer. There might be some back and forth. Think of it as haggling at a market—except the stakes are your financial future.
  5. Acceptance and Compliance: If the IRS accepts your offer, fantastic! But the journey doesn’t end there. You must stay compliant with all filing and payment requirements for the next five years, or your OIC gets revoked. Think of it like sticking to a diet plan after you’ve hit your goal weight—you can’t go back to old habits.

The Reality: It’s Not a Shortcut

Much like Kainalu learning to handle solids, an OIC is about gradual, measured steps toward a larger goal. It’s not about shortcuts or tricks. It’s about demonstrating genuine financial need and committing to a plan that the IRS agrees is fair.

Wrapping Up

As I celebrate Kainalu’s new milestone, I invite you to consider if an OIC might be the next milestone in your tax journey. It’s not for everyone, and it’s certainly not a walk in the park, but for those who truly need it, it can be a way out of a tough spot.

Need more guidance on whether an OIC is right for you, or how to navigate this complex process? Swing by my blog for detailed insights or drop a line for personalized advice. Remember, in taxes as in life, the best approach is always one step at a time!

Andrew Samaniego, EA, CTRC, MSCTA

Andrew Samaniego Tax Planning & Resolution

(619) 268-1084  |  AndrewSamaniego.com

Are You Missing Tax Returns? How to Regain IRS Compliance and Secure Your Financial Future

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Let’s talk about a timeline that might seem a bit daunting but is crucial for regaining your footing with the IRS: the last six years. Yes, you read that right. To be in good standing with the IRS, you need to have filed your tax returns for the most recent six years. Six years—think about how much can happen in that time. Six years ago, I was just a junior at the United States Naval Academy, visiting Hawaii for the first time to meet my future in-laws, and even running a football across states for the Annual Army-Navy Football Game.

Time flies, and unfortunately, so can our awareness of our tax responsibilities.

Why Six Years? Why Compliance Matters?

The IRS requires that you file the last six years of tax returns to be considered in compliance. This isn’t just a random number; it’s a considered measure to ensure that taxpayers are reasonably up-to-date without being overwhelmed by the need to go back indefinitely.

Being in compliance is crucial for several reasons:

  1. Negotiating with the IRS: Whether you’re hoping to set up a payment plan, negotiate an Offer in Compromise, or any other arrangement to manage your tax debts, being in compliance is the first step. The IRS won’t deal with you if you’re not up-to-date.
  2. Maintaining Agreements: Any agreement reached with the IRS, such as an installment plan or an Offer in Compromise, requires you to stay in compliance as a condition. Failing to file subsequent returns or make required payments can void these agreements, putting you back to square one.
  3. Avoiding Further Penalties: Staying compliant helps you avoid additional fines and penalties that can accrue from failing to file or pay taxes due.

How to Achieve and Maintain Compliance

  1. File All Due Returns: Start by filing any and all outstanding returns from the past six years. This step alone can lift a huge weight off your shoulders and prevent new penalties from accumulating.
  2. Adjust Withholdings and Payments: If you’re employed, ensure enough taxes are being withheld from your paycheck. If you’re self-employed or own a business, make your estimated tax payments quarterly and ensure all payroll taxes are deposited on time.
  3. Plan for the Future: Once you’re caught up, stay caught up. File all future tax returns on time, every time. This not only keeps you in good standing with the IRS but also gives you peace of mind.

Need Help Getting There?

Getting back into compliance can feel like navigating a minefield, but you don’t have to do it alone. If you’re feeling overwhelmed by the thought of digging up old documents and filing multiple years of returns, an experienced tax professional can guide you through the process.

To help you get started, I’ve put together a comprehensive e-book that breaks down everything you need to know about regaining and maintaining IRS compliance. You can download it for free on my website. It’s packed with actionable advice and insights to help you manage your tax situation effectively.

Visit crushirsanxiety.com to get your free e-book today and start your journey back to compliance. Remember, tackling this now can save you from bigger headaches later. Let’s get those returns filed and keep your financial future secure!

Andrew Samaniego, EA, CTRC

Andrew Samaniego Tax Planning & Resolution

(619) 268-1084  |  AndrewSamaniego.com

Can You Really Settle Your Tax Debt for Pennies on the Dollar? Discover the Truth About Offers in Compromise

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Happy Juneteenth, everyone! As we celebrate and unwind today, perhaps catching up on social media or diving into the new season of “House of the Dragons” (yes, we’re huge Game of Thrones fans here!), I want to tackle a topic that’s popping up a lot online. You’ve probably seen those flashy ads promising to wipe out your tax debts or let you pay just pennies on the dollar. They grab your attention, right? But let’s clear the air about what’s possible and what’s just fantasy.

A Trip Down Memory Lane

Before we get into the nitty-gritty of tax relief, let me share a quick throwback. Remembering my first trip to Dubrovnik, Croatia with my girlfriend now wife—walking through the real-life King’s Landing—reminds me that, just like navigating those ancient, winding streets, navigating your tax options can be complex and full of surprises.

The Real Deal on Offers in Compromise

So, what exactly is an Offer in Compromise (OIC)? Simply put, it’s a program the IRS offers that allows qualified individuals to settle their tax debts for less than the full amount owed. Sounds like a dream solution, right? But here’s the catch: qualifying for an OIC isn’t as easy as it sounds. It’s not about simply wanting to pay less; you have to demonstrate that you genuinely cannot pay the full amount due to your financial situation, including your income, expenses, and asset equity.

Are You Eligible?

Wondering if you might be eligible for an OIC? Here are a few critical boxes you need to check:

  1. You’ve Filed All Required Tax Returns: Yes, that means dealing with those back taxes if you haven’t filed in over the years.
  2. You’re Not Currently in Bankruptcy Proceedings: This automatically disqualifies you from considering an OIC.
  3. You Can Provide a Detailed Disclosure of Your Financial Situation: This includes proof of all income, expenses, and debts.

Why You Need an Enrolled Agent

Here’s where the plot thickens—just like any good episode of “House of the Dragons.” Successfully navigating an OIC requires more than just filling out some paperwork and hoping for the best. This is a complex legal process that involves negotiating with the IRS, and that’s why having an Enrolled Agent (EA) by your side is crucial. EAs are federally-licensed tax practitioners who specialize in tax resolution and can represent you before the IRS. They understand the ins and outs of the tax laws and will fight to get the best possible outcome for your situation.

Grab Your Free Guide to Crushing IRS Anxiety

Curious to learn more about how an Offer in Compromise could actually be your pathway to reducing your tax debts? Visit my website and download your free e-book, “How to Crush Your IRS Anxiety.” This guide will give you a detailed look at the OIC process and show you how an Enrolled Agent can help you conquer your tax dragons.

Don’t let those ads fool you, and don’t navigate the treacherous waters of IRS negotiations alone. Just like you wouldn’t wander into King’s Landing without a map, don’t tackle your tax issues without the right guide. Visit crushirsanxiety.com now to get your free e-book and start your journey towards real tax relief.

Andrew Samaniego EA
Andrew Samaniego Tax Planning & Resolution
(619) 268-1084  |  AndrewSamaniego.com