The alarming situation for both the businesses and individuals arose when they came to know that they have outstanding tax balance and can face penalties from the IRS. Furthermore, the fear of seizing of property hinders them to run the business or to do anything effectively.
The dilemma may lead to financial crisis. Coping with this type of problems, tax settlement firms jumped in for making the taxpayers get eliminated from the tax balance. Worrying with the situation, many taxpayers make the wrong choice by contacting with the firms that couldn’t help them in any way. In fact, sometimes taxpayer has to pay more penalties and interest than the original tax.
In this article, we will examine the working of tax settlement firms and how they are in the best interest to you?
How these firms work?
The working of many tax settlement firms seem same in the aspect that they sent their agent to the IRS on behalf of the company, to make them sure that the company will pay off or to have a deal with some amount, normally smaller than the tax balance. But, hardly this seems possible because the IRS doesn’t accept any type of bargaining. The IRS may show compassion, if you prove to show all that hindrance your taxpayer has to deal during paying taxes. This means that there is the near death of the taxpayer or the taxpayers’ business is totally sunk and has no assets now to pay off the taxes. Best case may be that the company will get the time of extension from the IRS to pay the taxes.
While some companies offer IRS with the bargaining offer that has an agreement for eliminating the tax bills of the taxpayer. Another, type of agreement is the settlement of taxes in reducing the bills. Such an agreement comprises an adjustment with a less amount that is actually owed. For this, the taxpayer has to deliver all the information properly about his current liabilities and assets and about the future income as well.
But, the statistics show the less number of applications approved by IRS under this agreement. Until tax settlement firms have to show that the amount of tax owed is not right or paying all amounts will result in the financial hardships for the business. To qualify for this offer is difficult sometimes or in the best case, it will take several months to complete.
Their payment process:
The firms charge an amount normally depending on the size of business and the tax bills proposed. This comprises from $3,000 to $6,000. Additionally, the fee is not refundable. You will find many companies complaining about the tax settlement firms that don’t fulfill their promise or that misguide their client about the payment. Like for example, in the starting, coming up with the less amount, but, after some time, when the businesses are in their full control and have shared all knowledge with them.
Citing the rejection of such applications, one cannot rate the success of these settlement firms to be true all time. So, the number of clients having satisfaction is low. In addition to that, those who have satisfied become financially deprived. The payment plans will need to work out with the IRS that can allow them with the clearance of all tax balances while keeping the assets safe.
Who is the Real?
You will find many tax settlement firms claiming the drastic reduction in the tax to their customers. Remember, any firm that claims this without having the complete knowledge of the company’s financial status, it will defiantly prove to be a scam. For recognizing who is the real or who is just a scam, make sure that the agency is conducting the process diligently.
So, to contact with the reputable firm is necessary that take all important financial data from its customers. And Based on that, give the real assessment about their working. Experienced firm is suggested in this regard which has a presence in the community for many years.
IRS is the most difficult to deal for all taxpayers. To deal with the tax settlement firms is a hard nut to crack. One has to face the danger at every turn. In fact, the IRS has issued warnings to many of the tax settlement firms. So, make sure that the firm you are contacting for assistance is enough qualified so as to deal with your tax issues. Additionally, they must undergo with a financial analysis of your business that may take several months to proceed.