I owe the IRS $4,000

[scho63]

Originally Posted by DaneMcCloud

The IRS will never, ever, ever rescind interest.

If you, as a taxpayer, can show hardship (i.e. surgery, cancer, etc.) for filing late or making a mistake, they'll likely rescind the penalty.

Otherwise, pay as soon as possible in order to avoid further interest and penalties.

WRONG as wrong can be.

If you make a deal with the IRS they will MANY times remove entire years of penalties and interest. I know personally as I got my 6 years of past due Fed Taxes reduced to 18% of what the total was.

On the other hand, most states are god damn brutal and not only do they NOT reduce your tax burden, they are very quick to confiscate 100% of your pay until their entire bill is paid. I also painfully know that first hand as I thought they were only allowed to take a PERCENTAGE each paycheck like 10-20% but I was misinformed. They can take 100%. It's brutal.

[Spott]

Originally Posted by scho63

WRONG as wrong can be.

If you make a deal with the IRS they will MANY times remove entire years of penalties and interest. I know personally as I got my 6 years of past due Fed Taxes reduced to 18% of what the total was.

On the other hand, most states are god damn brutal and not only do they NOT reduce your tax burden, they are very quick to confiscate 100% of your pay until their entire bill is paid. I also painfully know that first hand as I thought they were only allowed to take a PERCENTAGE each paycheck like 10-20% but I was misinformed. They can take 100%. It's brutal.

They also cleared it for my wife when our CPA ****ed up her taxes before we were married. She ended up getting a refund after initially owing over 100K in taxes as well as getting the interest rescinded. In her case, she sold a house for over 400K and for some reason the CPA screwed up and the entire proceeds of the house was shown as income. She actually sold the house for less than she bought it for and had to bring like 8 grand to closing to pay off the loan. So instead of paying capital gains tax on 400 grand, the amended return cleared the balance and actually gave her a refund. But it was still a royal pain in the ass dealing with the IRS and the CPA.

[DaneMcCloud]

Originally Posted by Spott

They also cleared it for my wife when our CPA ****ed up her taxes before we were married. She ended up getting a refund after initially owing over 100K in taxes as well as getting the interest rescinded. In her case, she sold a house for over 400K and for some reason the CPA screwed up and the entire proceeds of the house was shown as income. She actually sold the house for less than she bought it for and had to bring like 8 grand to closing to pay off the loan. So instead of paying capital gains tax on 400 grand, the amended return cleared the balance and actually gave her a refund. But it was still a royal pain in the ass dealing with the IRS and the CPA.

No offense, but did she even read her tax return?

I mean, holy shit, if my accountant listed my income as $400,000 dollars more than I earned, I'd hop on the phone immediately.

There's no freakin' way I'd sign the return and allow it to be filed.

[Spott]

Originally Posted by DaneMcCloud

No offense, but did she even read her tax return?

I mean, holy shit, if my accountant listed my income as $400,000 dollars more than I earned, I'd hop on the phone immediately.

There's no freakin' way I'd sign the return and allow it to be filed.

I don’t think she did. She was just used to handing over her returns to her CPA (who turned out to be worthless). To her defense she basically has two full-time jobs as both an attorney and a college professor, and didn’t have a lot of free time to do her taxes. When she dealt with the IRS, her account was being serviced by a special department due to the large amount, so it was a little easier to get in touch with someone and get things straightened out.

I received a similar letter that the OP did from the IRS a couple of years before because I made an IRA withdrawal and it wasn’t taxed. They made me pay that interest, but it was a real pain in the ass getting in touch with anyone at the IRS. None of the departments communicate with each other, so the department that sends out the notices doesn’t know that you’ve already paid the bill for a couple of months which caused me to continue to get notices after I had paid the money back (with interest).

I handle the taxes for us now and things are going much smoother now (knock on wood).

[DaneMcCloud]

Originally Posted by Spott

I handle the taxes for us now and things are going much smoother now (knock on wood).

Awesome, Dude, I'm happy for you both!

But seriously, people, if you're paying someone to prepare your taxes, at least take a cursory look before signing your name.

[Coach]

Originally Posted by DaneMcCloud

Awesome, Dude, I'm happy for you both!

But seriously, people, if you're paying someone to prepare your taxes, at least take a cursory look before signing your name.

This is correct. As a taxpayer, you are responsible for what you put on the forms, regardless of the accountant does.

Generally, most all accountants are good and honest people, but just to make sure YOUR ass is covered, you should go over it with the accountant and make sure the accountant EXPLAIN it to you in plain English, where their numbers are coming from the 1040's to the forms that you gave them.

If you have questions or unsure, ASK. And if you're still unsure, take a UNSIGNED copy of it and get a second opinion.

Because once you sign it and submitted, it's a done deal.

[DaneMcCloud]

Originally Posted by scho63

WRONG as wrong can be.

If you make a deal with the IRS they will MANY times remove entire years of penalties and interest. I know personally as I got my 6 years of past due Fed Taxes reduced to 18% of what the total was.

Reducing your overall tax burden isn't the same as completely eliminating or rescinding Interest Due.

I have many family members that are accountant and/or CPA's. Never once has the IRS rescinded interest, for any reason whatsoever, for any of their clients.

Penalties? Yes. Interest? No.

Others who are tax accountants and/or CPA's have chimed in this thread and have verified that the IRS will not rescind interest.

Again, the IRS, not the state.

[scho63]

Originally Posted by DaneMcCloud

Reducing your overall tax burden isn't the same as completely eliminating or rescinding Interest Due.

I have many family members that are accountant and/or CPA's. Never once has the IRS rescinded interest, for any reason whatsoever, for any of their clients.

Penalties? Yes. Interest? No.

Others who are tax accountants and/or CPA's have chimed in this thread and have verified that the IRS will not rescind interest.

Again, the IRS, not the state.

Well they are wrong because I got reductions on EVERYTHING including parts of Interest and Penalties.

It didn't go to zero but it was a far cry from the starting amount.

[DaneMcCloud]

Originally Posted by scho63

Well they are wrong

Yeah, every CPA and accountant that I've known in my life is "wrong".

Originally Posted by scho63

because I got reductions on EVERYTHING including parts of Interest and Penalties.

So, you cheated the US government out of your fair share of taxes, something you accuse "Liberals" of doing daily.

Pot meet Kettle