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19 September 2008

RE: [taxchat] Delinquency penalty / please help

I think the OIC general "formula" is to offer cash up front 60% of what the IRS could expect to collect over a period of 10 years or something like that, if I correctly recall what the E.A. I used to work for told me.  So if he's high income, you'd have to offer a whole lot of cash money.
 
Cheers,
JoJo
................................................................................................................
-----Original Message-----
From: taxchat@yahoogroups.com [mailto:taxchat@yahoogroups.com]On Behalf Of Cris Kelly
Sent: Friday, September 19, 2008 10:08 AM
To: taxchat@yahoogroups.com
Subject: RE: [taxchat] Delinquency penalty / please help

The penalty turns out to be 25% exactly – however, I didn't see that number on the paperwork only the 20%,

 

The consensus seems to be that I won't be able to get any of the penalties/interested abated, what do you think my chances will be with an OIC?

 

Thanks for the help,

 

Cris

 

From: taxchat@yahoogroups.com [mailto:taxchat@yahoogroups.com] On Behalf Of Arnold M. Socol
Sent: Friday, September 19, 2008 9:31 AM
To: taxchat@yahoogroups.com
Subject: Re: [taxchat] Delinquency penalty / please help

 

That's not the 20% penalty - its just straight late paying penalty, if that's any help

 

Arnie

 

 

----- Original Message -----

Sent: 09/19/2008 10:31 AM

Subject: RE: [taxchat] Delinquency penalty / please help

 

I wouldn't be too optimistic about getting the penalty removed.  I went to appeals earlier this year to try to get an accuracy penalty removed for a client because a W-2 was inadvertently omitted.  It wasn't the client's fault.  Appeals said that client had an obligation to review the return for accuracy, so he didn't have reasonable cause for abatement of the penalty.

John Stevens, EA
Stevens Tax & Accounting, Inc., dba Equi-Tax
1870 - 50th St. E., Suite 8
Inver Grove Heights, MN 55077
651-773-5000
FAX 651-457-4529
equitax@unique-software.com
www.equitax.net



From: taxchat@yahoogroups.com [mailto:taxchat@yahoogroups.com] On Behalf Of Benita Myers
Sent: 09/18/2008 8:37 PM
To: taxchat@yahoogroups.com
Subject: Re: [taxchat] Delinquency penalty / please help

Cris, sounds like they have smacked him with the substantial understatement penalty and that penalty is 20%...Stiff penalty, he needs reasonable cause to get out of it...It does not sound like he has one...

2008/9/18 Cris Kelly <ckelship@yahoo.com>

Hi

I have a client that under-reported income in both 04 & 05.  The 04 amount not reported was large over $135,000 and the amount for 05 was under $20,000.

The situation is that he had a bookkeeper (not an EA or CPA) doing his books and preparing his tax returns.  He never checked up on things and he signed whatever the bookkeeper told him to.

The amounts were put into the company, they were posted as owner investment instead of income. 

The amount of penalty is almost $20,000 and they are charging him interest over $17,000.

Does anyone think that I have any hope in getting the numbers reduced?  While the errors were technically his fault and all he can say is that he was stupid, but he is trying to fix things. 

Any suggestions would be appreciated.

'

Thanks,

Cris

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--
Benita Myers, Enrolled Agent
Office and Fax: 916-691-6715

IRS Circular 230 Disclosure: Unless expressly stated otherwise in this transmission, any tax advice contained herein, forwarded with or attached to this message was not and is not intended to be used, nor may it be relied upon or used, by any taxpayer for the purpose of (1) the avoidance of any tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions, or (2) promoting, marketing or recommending to another party any tax transaction or tax-related matters that may be addressed herein.


 

 

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IRS Circular 230 Disclosure: Unless expressly stated otherwise in this transmission, any tax advice contained herein, forwarded with or attached to this message was not and is not intended to be used, nor may it be relied upon or used, by any taxpayer for the purpose of (1) the avoidance of any tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions, or (2) promoting, marketing or recommending to another party any tax transaction or tax-related matters that may be addressed herein.



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