IRS Debts Archives

Who Gets Paid First: the Family Member or the IRS?

When someone owes the IRS money, chances are good that they have other creditors who are also owed money. This raises questions as to who gets paid first–the third parties or the IRS. The answer is usually the IRS–if the IRS even bothers to attempt to collect. In many cases, the IRS does not ever…

IRS Can Force Business to Use Payroll Service, Court Rules

When a business fails to pay its payroll taxes, the consequences can be severe. The IRS has several collection tools at its disposal to collect unpaid payroll taxes. This includes liens, levies, and even criminal charges against the business owners. The IRS recently attempted to expand its collection powers to prevent future non-compliance. In United…

IRS Can Sidestep Taxpayers’ CDP Rights by Applying Overpayments

Imagine that Congress sets out a remedy to curb IRS abuses. And further consider that after the taxpayer pursues the remedy, the rules allow the IRS to simply sidestep the remedy. So the remedy is no remedy at all. That is what we have in the Zuck v. Commissioner, No. 25125-14L (U.S.T.C. Apr. 6, 2022)…

Resolving IRS Taxes: What is “Future Income”?

When it comes to tax rules and government administrative guidance, one may expect that the provisions are clear and can be easily applied. However, this is often not the case. Even detailed regulations with explanations may fail to provide readily discernible answers. Applying such rules to common situations can still lead to questionable or incorrect…

Transferring Property to a Spouse to Avoid IRS Collections

Imagine you live in a community property state, like Texas, and jointly own a home with your spouse. You owe back taxes to the IRS and want to protect your share of the home if the IRS tries to seize your assets. You divorce your spouse and transfer your interest in your home to your…

Court Rejects IRS Claim to Taxpayer’s Property

If a bank loans money to a business to buy equipment when the business owes back taxes, can the bank foreclose on and repossess the equipment? Does the bank or the IRS have a superior interest in the equipment? This gets into questions of state and federal law. Generally, state law defines property rights and…

Start a New Business to Avoid Old Taxes

Payroll taxes kill businesses. It is very easy to get behind, whether the business owner uses the funds to pay other expenses or due to a mistake. Once there is a payroll tax balance, it can be very difficult to catch up. The penalties and interest compound the problem. If you’re a business owner and…

Avoid Late IRS Installment Agreements

The concept of “judicial activism” refers to situations where judges do more than simply interpret existing laws. They venture into creating new laws or policies through their rulings. This encroaches on the legislative power of Congress, which creates the laws, and the executive agencies, which create policies to implement the law. This type of discretion…

Late-Filed Tax Returns & Excess Collections

Life happens. We all experience it. There are times when life events can result in tax returns being filed late. Our tax laws offer little in way of leniency when this happens. The IRS will assess late filing penalties. Worse yet, amounts that were already timely paid to the IRS may not be refunded to…

The “Process” of the IRS Appeals Collection Hearing

The government establishes processes to carry out its essential functions. These processes handle a myriad of different types of cases and cases with nuanced fact patterns. These processes allow the government to process a high volume of cases. They often do so in bulk. The process is a like well-trodden path. The path may take…