Why you should NOT wait until tax reform to settle with the IRS
by: Claudine Gindel
We have many people reach out to us regarding their tax issues. Lately, the most common question we get is, "Should I wait until tax reform passes before I handle my tax problem?" The short answer is "No." But why?
In this video, Attorney Anthony Parent talks about why it's not a good idea to wait for tax reform to pass to settle your tax debt. He goes through actual figures from a current client of ours and talks about how tax reform would crush our current Offer in Compromise amount. He touches on:
How even a little change in your current tax rate can really frustrate a good settlement.
How this would affect allowable expenses. (Hint: a big allowable expense for many of our clients is federal taxes!)
Understanding how to calculate your actual ability to pay.
If there is a 15%-20% tax rate on pass-through entities, how is this bad for settling back taxes?
If your monthly expenses drop, how will this affect your monthly ability to pay?
Why waiting for tax reform to pass is an expensive risk to take.
Note: Not everyone qualifies for an Offer in Compromise. Sometimes the best solution for a client is some form of an installment agreement. Be sure to learn about yesterday's topic -- the Pros & Cons of IRS Streamlined Installment Agreements. If you'd like to talk to us about the best options for your case, contact us. We can help. Call us at 888-727-8796 or email firstname.lastname@example.org.