Tax Relief with Timalyn Bowens
Episode 62: In this episode, Timalyn explains why the IRS selects certain taxpayers for audits and reassures listeners that being chosen does not automatically mean anything is wrong. Following up on last week’s episode, , Timalyn continues her audit series by breaking down how audit selections are made and why it is important not to panic if you receive an IRS notice. Contrary to common fears, receiving an audit notice does not mean jail time or that you did something wrong. Many audits are selected at random or flagged through a computer system that looks for unusual patterns or...
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Episode 61: In this episode, Timalyn breaks down one of the most misunderstood topics in tax: the IRS audit. After 60+ episodes of educating taxpayers, she’s kicking off a brand-new series that explores what an audit really means — and what it doesn’t. Many people fear a suit-wearing IRS agent knocking at their door, but as Timalyn explains, that’s highly unlikely. Instead, most audits today are conducted through correspondence and notices, not surprise visits. So, what is an audit? An IRS audit is simply a review or examination of your accounts and financial information to ensure you...
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Episode 60: In this episode, Timalyn explains your right to appeal unfair IRS decisions and why you shouldn't give up. We are celebrating three years and 60 episodes of the Tax Relief with Timalyn Bowens podcast! Provisions from the 2017 Tax Cuts and Jobs Act are set to expire in December, and many taxpayers are worried about IRS mistakes - especially after recent budget cuts and workforce reductions. Does this mean you have to accept wrongful IRS decisions? Timalyn says absolutely not. She explains that the IRS has an Independent Office of Appeals that provides fair, impartial review of...
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Episode 59: In this episode, Timalyn addresses whether or not the IRS is here to stay. We have seen significant changes at the IRS within the past few months as they went through a work force reduction. We have also seen them lose $40 billion of the $80 billion that was promised to them in funding by the Biden Administration. Does this mean that they are going to go bye bye? Timalyn doesn't believe so. She believes that this smaller force will make it more difficult for taxpayers to handle their IRS issues on their own. She also fears that some taxpayers will receive unfair treatment, as well...
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Episode 58: In this episode, Timalyn explains how much time you have to pay your tax bill and how much time the IRS legally has to collect. Your tax balance is due on the due date of the return. However, when the IRS sends you a will give you 30 days to pay before the IRS uses any enforcement. This includes things like an or . If you can pay the debt off within 180 days you may qualify for a short-term installment agreement. This agreement can be arranged using your online IRS.gov account to set up an online payment agreement (OPA). If the amount is over $50,000 you will have to...
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Episode 57: In this episode, Timalyn explains the reason you likely owe taxes this year. She highlights 5 common reasons that people owe each year. It is ultimately the responsibility of the taxpayer to ensure that they are withholding enough taxes. The top 2 reasons that people owe the IRS is because their withholding and/or estimated tax payments are off. Timalyn has created a series on her YouTube channel to walk you through the process of correcting your withholding for a W-2 job, pension, or your social security. You can find this series below. If you are self-employed or...
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Episode 56: In this episode, Timalyn explains that all hope is not lost if you can't pay your taxes in full. You do have options! First, take a deep breath! Make sure that you have your tax return filed on time. This will help you avoid any additional penalties, such as the . Payment Arrangments You may qualify to pay your balance over time. If you owe less than $50,000 and have been tax compliant you may qualify to set up an OPA yourself using the IRS website. An OPA is an . If the balance is $10,000 or less and you haven't owed in the past 3 years or defaulted on an...
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Episode 55: In this episode, Timalyn explains what the failure to file penalty is and why it is adding so much to your tax bill. She will not only talk about what it is but how it's calculated, and how to potentially get it removed. Can't File Your Taxes On Time? You can avoid the failure-to-file penalty by filing a timely tax return or tax extension. If you're an individual needing to file an extension you can do so by filing Form 4868. Timalyn will have a video to walk you through filing the 2024 4868 on her YouTube channel, coming out on March 31st. The Failure to File...
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In Episode 54 Timalyn discusses unemployment tax and how it affects a taxpayer's tax liability. Some forms of unemployment are not taxable such as workers compensation. The topics covered in this episode are: What is unemployment? Is unemployment taxable? What's workers compensation? How is unemployment reported? What is Form 1099-G? If you'd like to work with Timalyn directly, you can book a call with her at www.Bowenstaxsolutions.com . As we conclude Episode 54, we’d like to encourage you to connect with Timalyn on social media. You’ll be able to...
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In this episode, Timalyn discusses severance pay and the tax implications of receiving a severance package. She breaks it into 3 sections: What is severance pay? Is severance pay taxable? Why is my severance pay taxed at a higher rate? How to lower the taxes on your severance pay. If you are already facing a tax debt that you can't pay in full Timayn mentions episode 18 - as a resource for you to use to stop the IRS from using enforcement such as tax levies to collect from you. If you'd like to work with Timalyn directly you can book a call with her at . As we conclude...
info_outlineEpisode 48: In this episode, Timalyn explains an option some people have in resolving their tax debt. This option is referred to as an offer in compromise. Understand that not every tax payer qualifies for this, but you hear commercials about it all the time.
Note: This is a complex topic and deserves more than a quick, 15-minute episode to fully explain it. The plan is to cover this topic in 2 separate episodes. The next episode will explain how you qualify for an offer in compromise, while this episode explains what an offer in compromise is.
While not every taxpayer will qualify for the offer in compromise, the vast majority (90%+) would actually qualify for an installment agreement (Episode 10). This may be the better option for many people.
An important reason Timalyn is covering this topic is so that you can understand “WHY” you may or may not meet the criteria for an offer in compromise option. Regardless of what you may have seen on the Internet, filing on your own is not something you should do, if you’re in serious tax debt. When you hire someone for tax representation, that person takes on the responsibility of speaking on your behalf before the IRS.
Offer in Compromise – Doubt as to Collectability
This is an agreement that settles your debt for less than the amount owed. Again, this is the hook used by many of the commercials you may have heard. The partial pay installment agreement would do the same thing without exposing your assets to a potential liquidation requirement.
The IRS will not accept your offer if there’s a chance the liability can be paid in full, in a lump sum or in an installment agreement. The streamlined installment agreement typically has a 72-month pay-off term. If you’ve already been working to get yourself in a better situation to be able to pay your taxes, and you owe $10,000 or less, you may have the option of a guaranteed payment plan.
Even though you might think you can’t repay your debt via an installment program, remember, the IRS has some additional discretion, because they are limited by the CSED (the Collection Statute Expiration Date). However, if they determine you would be able to pay off your tax debt before the CSED, they would reject an offer in compromise.
Owe $100,000 or more in Tax Debt?
Getting an offer in compromise approved will require an additional level of authorization. This would be granted by the IRS District Counsel.
Some people refer to the Offer in Compromise as the fresh start initiative. The program began in 2011. It changed the computation for a taxpayer’s future income. It also extended the amount that can be repaid for student loans, as an allowable expense. Episode 38 goes into more detail as Timalyn discusses IRS Form 433-F.
Offer in Compromise – Doubt as to Liability
You would submit this when there’s a genuine dispute as to the existence of a tax debt, or the amount of the tax debt. It’s used when there’s a likely error by the IRS in assessing the tax debt.
The offer must be greater than $0 and based on the amount you believe is the correct amount of tax liability (not what the IRS is claiming you owe).
The Doubt as to Liability option will require you to submit IRS Form 656-L.
The Doubt as to Liability option is typically used after an audit was performed and tax was assessed. However, you had incomplete documentation at the time. Now, the supporting documentation you’ve found shows you really don’t owe the amount indicated by the IRS.
Offer in Compromise – Effective Tax Administration
This is when the amount owed is not in dispute. There are assets that could be liquidated to pay the debt, but exceptional circumstances exist that would result in an undue economic hardship, if full payment of the debt would be required. The same would exist if paying the full tax debt would be unfair or unequitable.
Timalyn provides an example of an elderly individual living on a fixed income. Even if this person owned his/her home, selling the home to pay the taxes would make it very difficult from a financial standpoint, assuming the person were to live another 10 years, or more. Social security retirement benefits are really not enough to live off of, given today’s inflationary environment. The cost of living is relatively expensive, so adding a rent payment would make it nearly impossible.
In the above example, this individual might be an ideal candidate for the offer in compromise – effective tax administration option.
Need Tax Help Now?
If you need answers to your tax debt questions, book a consultation with Timalyn via her Bowens Tax Solutions website. Click this link to book a call.
Please consider sharing this episode with your friends and family. There are many people dealing with tax issues, and you may not know about it. This information might be helpful to someone who really needs it. After all, back taxes shouldn’t ruin their life either.
As we conclude Episode 48, we encourage you to connect with Timalyn on social media. You’ll be able to subscribe to this podcast on Spotify, Apple Podcasts, Google Podcasts, and many other podcast platforms.
Remember, Timalyn Bowens is America’s Favorite EA and she’s here to fill the tax literacy gap, one taxpayer at a time. Thanks for listening to today’s episode.
For more information about tax relief options, visit https://www.Bowenstaxsolutions.com/ .
If you have any feedback, or suggestions for an upcoming episode topic, please submit them here: https://www.americasfavoriteea.com/contact.
Disclaimer: This podcast is for informational and educational purposes only. It provides a framework and possible solutions for solving your tax problems, but it is not legally binding. Please consult your tax professional regarding your specific tax situation.