Today on Tax Hacker Tuesday with Epic Real Estate, Tim Berry and Bernie Garland explain what to do if you can’t pay your taxes. Learn all about the IRS’s new initiatives, how to qualify for them, and the exact steps you should take if you can’t pay your taxes.
What You Will Learn About What to Do If You Can’t Pay Your Taxes:
- Why the IRS is kinder now than before
- The new initiative that helps people who owe big money to the IRS
- The typical terms of IRS payment plans
- What streamline initiatives are available
- How to qualify for the streamline plan (and how much you can owe)
- What happens when you qualify for the streamline plan
- How many months you have to pay with the streamline plan
- What terms you can expect if you owe $50,000 or more
- It’s been great meeting you virtually. Would you like to meet in person? Our next live event is right around the corner! Go to EpicIntensive.com for the details.
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Speaker 1: This is Theriault Media.
Did you know that up to 50% of your lifetime income will be wiped out by taxes? What if you could stop this madness? Isn’t it about time you play on a level playing field with the wealthiest 1%?
Now, you can. Tim Berry, attorney-at-law, shares here each and every week current tactics and strategies that anyone can implement to hack the tax code. Protect your assets and keep what’s rightfully yours. It’s time for Tax Hacker Tuesday.
Bernie Garland: I owe, I owe, so off to work I go. Now sometimes if you owe the IRS lots of money we have clients that work two and three jobs because they feel they have to pay at that exorbitant rate. Do you know anything about that Mr. Tim?
Tim Berry: The great thing about the IRS is that it’s a kinder, gentler IRS now, isn’t it?
Bernie: It is so kind and so gentle.
Tim: And so they came out with this new program, this new initiative where they will loan you the money to pay your taxes, because the big thing and this is what Bernie says all the time is compliance that’s the buzz word. They want you to be in compliance and they found that whenever people don’t have the money to make payments they fall out of compliance thus the IRS will give you a payment plan. And Bernie, what are the typical terms of the payment plans?
Bernie: The payment plan is take a look at what your gross income is minus your withholding, your SDI, etc., take a look at your business and personal expenses and whatever’s left over, if anything is what you agree to pay to the IRS.
Tim: And how about, do they have any streamline initiatives, is there anything we can do there?
Bernie: Oh they’ve got a plethora, a plethora of streamline issues, and what we’re talking about is this. Commissioner Schuman in his wisdom, and I have to say I really enjoyed working with the IRS when Commissioner Schuman was there. He figured out that if you owed less than, initially $10,000 they would not assign a revenue officer, in other words a collections specialist showing up at your front door. They simply said, make sure you’re in compliance and make sure you can pay this $10,000 that you owe over a period of 60 months. And this was the initial one, it was 60 months. Then it worked out so well because people want to pay their taxes but they are afraid of the IRS so now here is an easy plan called the streamline plan at that time.
It worked so well Tim it went to $25,000. And if you owed $25,000 and you’re contacting the IRS because you owe that you can qualify for the streamline plan. And guess what happens.
Tim: What happens?
Bernie: No lien is filed, no wage attachment, and no bank account attachment as long as you pay that money. Now it went from 60 months to what, 72 months. So as if you owe less than $25,000, less than $10,000 you can control your own destiny. And I guess the government actually has loaned you this money that you used but didn’t pay, and now you’re paying it back on your terms. Not theirs. There’s also a $50,000 time limit. And if you owe $50,000 now you’ve got to submit a couple of financials, but the same thing will apply. So in other words, I don’t know if they’re kinder or gentler. But they’re kind of more pragmatic.
Tim: Got it, so bottom line, if you don’t have the money, don’t freeze, file your tax return, that’s super important. And then the government can work out a payment plan with you.
Bernie: Make sure you’re in compliance because we found if you do not understand that you can control these streamline plans and most of you owe less than $10,000, most of you owe less than $25,000, if you do not understand this you don’t file, then you don’t file the next year, then you don’t file the next year, so it’s very simple. File your tax return and set up, at the time you file your tax return you can set up a streamline plan. It’s a government loan.
Tim: It’s a fantastic thing.
Bernie: And you didn’t even have to apply for it.
Bernie: You just institute it and it’s done.
Speaker 1: That’s it for today as we dream of a tax system that works just for you. But until then you have Tim Berry, see you next Tuesday for another episode of Tax Hacker Tuesday.