Can I Escape IRS Problems and Penalties?
IRS problems begin when a taxpayer becomes non- compliant to filing tax returns. Non- compliance can be possibly rooted from one main reason: escape from payment. Truthful financial incapacity can be an acceptable ground for a failure to pay plea but not for filing escape. The tax collectors are very strict about collecting due taxes. The IRS is aggressively pursuing charges to fraudulent individuals who try to mislead the agency. Alas, most delinquent taxpayers have cited financial incapacity for non- payment.
You cannot escape IRS problems and penalties but the IRS may consider your failure to file excuse. Here are some of the acceptable excuses to the IRS:
Natural Disasters
Fire and other natural disturbances may be a considerable excuse for not filing your tax return. However, the IRS clears out that not all cases can be applicable to failure to file excuse. The IRS will further investigate your capacity to pay prior to the occurrence of the calamity. Then they will decide whether you have a plausible reason or not. Otherwise you will be facing IRS problems with no escape at all.
Unavailability of Records
Sometimes, the IRS will considerably pardon individuals who claim failure to avail the necessary records like tax preparer withholding records from the tax filer, etc. The exemption varies from case to case basis. However, you must still prove your case to the IRS so as not to aggravate your tax problems.
Ignorance of the Law
While taxpayers are obliged to learn about the laws of taxation, the IRS may still consider ignorance of law as a reasonable excuse for failure to file tax return on time. However, the IRS will examine the incapacity of the individual to know about taxes. Only by then that the taxpayer will be free from facing IRS problems but is still required to pay due taxes.
Incorrect Advice from Tax Professional or IRS Agent
True, nobody\’s perfect. Even the tax professionals commit unlikely mistakes enabling taxpayers to face IRS problems. Incorrect advice from professionals may be an acceptable excuse to the IRS. But then again, you have to sensibly prove your case.
Death, Serious Illness, Unavoidable Circumstances
Death or serious illness of the taxpayer or the taxpayer\’s immediate family may be considered by the IRS. With death and physical incapacity of the taxpayer, the person in-charged of his estate is required to explain to the IRS the specific reasons that prevented the taxpayer from filing taxes on time (prior to death and illness).
Even if you provide a reasonable cause for not failing tax returns it doesn\’t necessarily mean that you\’re free from IRS problems. In fact, you are still penalized by law. However, if you are truly facing financial crisis, you may request for an installment payment by completing Form 9465. When the IRS grants you the request, you may bargain on monthly payment that is feasible to you. The grant will also prevent the IRS from interfering with your assets, wages and bank accounts.
Everyone will encounter IRS problems at least once in their lifetime. When you evade payments for selfish cause you have to deal with the daunting IRS problems. You have to deal with the harshness negotiation with the IRS and expect swelling penalties and interests on your account. If you are found guilty of tax evasion, you are likely to spend years in prison- counting each year of non-filing. Also you will be fined up to $25,000 for each year that you missed filing tax returns.
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