Americans in the state of Georgia can expect delays in receiving their tax refunds, especially for those who filed their tax returns via paper filings.  Those who filed their returns electronically, however, are unlikely to be affected.  Why the discrepancy?

It all stems from the economic slowdown in the country and the consequent budget cuts to state governments.  In the face of 13 consecutive months of declining tax revenues, the Georgian government has had to embark on stringent cost cutting measures, reducing its expenditure by about $8.4 million this year.  Among the measures taken to achieve this are compulsory no pay leave by civil servants.  Tax processors in the state government are not spared.  Together with all Georgian state civil servants, tax processors have to each take 3 additional days’ compulsory leave without salary by June 30th this year, which happens to be the end of the fiscal year for the state government.  Besides these measures, the state government has also had to lay off a number of staff workers.

This precipitated a lack of manpower in the state tax department that resulted in a huge backlog of tax refund cases, thus the delays for Georgians, some of whom have waited months.  More acutely affected are the taxpayers who made their tax filings through paper submissions as they are more difficult to evaluate and process.

On the other hand, the delay in issuing refunds results in additional costs to the Georgian government as they have to pay interest to every taxpayer who is issued his or her refund later than 90 days after the April 15 deadline for filing taxes.  A similar thing happened last year and the Georgian government had to fork out just over $2 million in interest payments to over 270,000 of its citizens who received their refunds late.

State revenue commissioner Bart Graham said that approximately 55% of Georgians filed their tax returns electronically last year and the remaining 45% did so through paper submissions.

To increase the percentage of taxpayers who make their tax returns electronically, the IRS has issued a regulation requiring all tax preparation firms submitting more than 10 returns per year to do so entirely through electronic means.  Due to that, the Georgian state government hopes that things would be better this year and the numbers of delayed tax refunds to substantially reduce.

However, you should not get your hopes up because Georgian Governor Sonny Purdue will be leaving office at the end of this year.  How this will affect the financial situation in Georgia will be anybody’s guess.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

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Do you know what CSED stands for?  Collection Statute Expiration Date.  And CSED means the time period by which the IRS must collect the taxes you owe.  Beyond this time limit, your tax debt is cancelled.  But before you jump for joy, you need to know that the CSED time limit is 10 years.  And furthermore, it can be extended.  Your CSED period can be extended due to several factors listed below.  If you are not sure if your CSED expired, you should consult a tax attorney who can help you sieve through your personal records of tax payments and other tax related matters.  Here are several situations where your CSED may be extended.

Essentially your CSED may be extended if you have made any applications for a reduction or cancellation of your tax debt.  For instance, if you have tried to declare bankruptcy, your CSED is extended by the time the bankruptcy proceedings go on.  If you have applied for any number of Offers in Compromise, that time cannot be figured into your ten years, either. An Offer in Compromise typically takes 1 year to be completed so your CSED is also extended by that length of time.  So quit trying to play cat and mouse with the IRS; they will begin to come at you with tougher and tougher sanctions as your CSED date draws closer. With bulldog tenacity, they will stop at nothing to collect the money that is theirs long before the deadline hits.

But this does not mean an Offer in Compromise is futile.  In fact, it has saved thousands of Americans millions of dollars in the past and it can save you, as well. But first, you need to show that your tax debt is beyond your capacity to repay.  If you succeed in doing so, then your CSED becomes immaterial.  If your Offer in Compromise comes through, the IRS will likely cut a deal with you so you can get away with paying significantly less. Secondly, if you can show that there was an error in the computation of your tax bill, you can have it reduced or even cancelled altogether.  One final option is to offer a lump sum payment that is less than what you owe. If the lump sum is not less than 80% of the total tax bill, it is not uncommon for the IRS to accept your proposal and waive the rest of your debt.

So you should consult a tax attorney who can advise you on which course of action is the most suitable for you.  If you succeed in reducing or eliminating your tax debt, you won't need to worry if your CSED expired or not.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

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Here’s a relatively little known fact – you can completely cancel your tax debts by being declared a bankrupt.  Of course, there are certain conditions that you must fulfill.  But if you meet the basic criteria, you can wave goodbye to your tax debts.  On the other hand, there are several implications about being declared a bankrupt, so be sure you talk to a lawyer to evaluate your debt removal options first before going ahead to apply for either Chapter 7 or Chapter 13 bankruptcy.  Bankruptcy is not a convenient way to escape paying your tax dues, it is a provision for those who genuinely cannot afford to pay to be relieved of their tax debts.

There are 2 provisions of the Bankruptcy Code under which you can apply for bankruptcy.  They are Chapter 7 and Chapter 13.  In general, Chapter 7 bankruptcy means that you will have your entire tax debt forgiven.  On the other hand, under Chapter 13 you may have some of your debt cancelled and the remainder will be paid off via installment payments.  Most individuals choose Chapter 7 over Chapter 13, but if you have a lot in the way of assets or your own business, Chapter 13 may be a better answer for your particular situation.  There is much to consider when it comes to bankruptcy, taxes and your own personal financial situation, so you need to have a good understanding of all this before deciding whether to go ahead with your bankruptcy application.

There are 5 conditions you must fulfill in order to make a successful application for bankruptcy.  Firstly, the debt must be more than 3 years old in that the due date for filing your taxes must be more than 3 years ago.  This prevents people from declaring bankruptcy year after year so they don’t have to pay taxes. This time frame also gives both you and the IRS plenty of time to figure out other methods of payment short of declaring bankruptcy.   Secondly, the tax return itself needs to be filed at least two years ago.  Likewise, the third condition states that the assessment for your tax must be at least 240 days ago.  These conditions are imposed to allow the IRS to have as much time as possible to collect the taxes from you.  Bankruptcy should be a last resort.

Under the fourth condition, you must not fraudulently apply for bankruptcy otherwise you will not be given any bankruptcy protection.  The final condition states that you must not be guilty of tax evasion at any point during your life.  These rules about bankruptcy and taxes are vitally important if you wish to file for bankruptcy to remove your tax debt.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

Many people do not realize that tax debts can be changed or compromised over.  The truth is that if you deal with the IRS in good faith and accept your responsibility, they will be more than willing to work with you to reduce your tax burden. The important thing to do is stay on top of your tax debt so that it does not accumulate.  The following tips will help you deal with your debt so it doesn't grow into a devouring monster.

Most times, the IRS will work with you to assist you in paying off your tax debt.  After all, when you can pay your dues, it is to their benefit.  They will carry out an assessment based on how much you earn per year and how much your total debt is. This allows the IRS to calculate the reasonable amount you can pay within the year.  If your total debt far exceeds your earnings, you can expect the IRS to be more than willing to compromise. This is only one of a few ways you can reduce or eliminate your tax debts.

A different type of compromise can be received when you can show that paying off your tax debt will result in financial hardship to you and your family.  In most cases, an undue hardship is defined as something like the lack of ability to pay medical bills or the danger of losing your home. On the other hand, other financial difficulties, such as losing your second home, not being able to pay your credit card bills or your children's tuition fees do not warrant any compromise. As damaging as a bad credit report is, the IRS will not spare you for that reason alone.

The final means to reduce or eliminate your tax debt is to show that the tax debt charged to you is not your liability either partially or entirely.  There could be an accounting oversight or a simple typo on one of your forms that resulted in the error. Although proving such a thing can be difficult, such a move should be taken if there is legitimacy to it.  If you succeed, however, you can wipe out most of all that you owe or at the very least get a compromise from the government.

These are the several things you can do about your tax debt.  But it is imperative that you act without delay.  As soon as you start to receive notices from the IRS, respond and inform them that you are doing something about it. Otherwise, you may run into problems dealing with your tax debt.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

Many married couples opt to make joint tax returns to qualify for certain tax breaks given to couples.  But making joint returns also means being jointly liable for any IRS actions against you.  Things get more complicated when a divorce ensues.  That's why the government enacted a new policy called the Innocent Spouse IRS Exemption.  Under this policy, if you are a divorcee who is innocent of tax-related wrongdoing, you will not be penalized for the wrongs of your irresponsible ex-spouse.  However, there are some things that need to be done to obtain the Innocent Spouse IRS Exemption.

The IRS has set a number of criteria that you must meet in order to be eligible for this exemption.  This new rule is open to anyone who has had to forfeit a tax refund because of the financial irresponsibility of their partner. This could have happened because of unpaid back taxes or it could be because of other unpaid debt, such as an unpaid student loan.  So if you have been the innocent victim of the financial irresponsibility of your ex-spouse and you are owed money by the IRS because of that, then you should apply for the Innocent Spouse IRS Exemption.

Even if you do not qualify to have a tax file of your own, you can claim for the Innocent Spouse IRS Exemption if the criteria reflect your situation.  The IRS understands that it was not your fault, therefore they are prepared to give you some breaks to help you out as you start a new life as a single person again.

You will find lots of questions asked of you to determine your eligibility when you apply but do not be put off by them.  It may be a bit complicated, but it is the easiest way to depict the qualifications for this tax break.  If you engage a professional to file your tax returns, discuss with them the possibility of your qualifying for the Innocent Spouse IRS Exemption.  It could be the difference between a nice big refund and a huge tax debt.

This is a new policy implemented only this year, but may very well become a permanent fixture in the tax code if it is well received and benefits many people.  Although things can change quickly, if you feel that you qualify for the Innocent Spouse IRS Exemption for next year and beyond, ask to see if it still exists.  To find out more about the Innocent Spouse IRS Exemption, discuss it with a tax attorney.  You could also contact the IRS through their toll free number or check up their website.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

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