Miami Tax Debt Settlement Lawyer

Miami Tax Debt Settlement Attorney

If you’ve missed a tax payment, the financial consequences can add up quickly. There are a lot of reasons that taxpayers fall behind on payments, including life emergencies or sudden financial expenses. It can be stressful to address tax debt, but ignoring it will create a much bigger issue. If you owe taxes to the Internal Revenue Service (IRS) or the Florida Department of Revenue (DOR) and you can’t pay, a Miami tax debt settlement lawyer can help determine potential solutions.

When you work with a dedicated tax lawyer, they can give you the information you need to make crucial choices about your financial future.

TaxSmith, LLC: Supporting Miami Taxpayers

Getting legal support is crucial if you can’t pay your debt to the IRS or the DOR without putting yourself in financial hardship. There are options to reduce your tax liability or give you more time to pay it in full, and taking action helps you avoid more serious consequences like collection actions. These actions can impact your property, accounts, and credit.

By working with TaxSmith, LLC, you can secure compassionate and straightforward legal advice about your tax debt and settlement options. We have spent decades providing tax advice for individual and business taxpayers throughout Miami and the surrounding communities. While every taxpayer’s situation is different, our team has likely seen cases similar to yours. We use this experience to quickly determine how to settle your debt.

IRS Tax Settlements

Not all taxpayers qualify for tax debt settlements. When you owe the IRS unpaid taxes, penalties, and interest, you generally must pay back what you owe in full. The IRS is open to compromises when paying your full tax debt would cause financial hardship or when you don’t have the financial resources to pay the amount. A tax settlement can give you more time to repay your debt or forgive part of the debt. That way, the IRS can recover a portion of what is owed.

What Does the IRS Consider for a Potential Debt Settlement?

The IRS will review several aspects of your unique financial situation to determine if the type of settlement or relief you are requesting is appropriate. For example, an offer in compromise is a powerful tool of debt settlement but is one of the hardest methods of debt settlement to secure. The IRS will consider the following:

• Your income
• Your ability to pay the debt
• The assets and resources you have access to
• All your other expenses

The IRS is likely only to approve this debt settlement method if all other options have been attempted and will not enable you to take care of your own financial needs.

Working with a tax attorney can help you review your financial circumstances and determine your options for debt settlement. The closest Taxpayer Assistance Center is located in downtown Miami, at 51 SW First Avenue in Suite 311. An attorney can represent you in any in-person meeting, limiting your stress in these situations.

What Are My Options for Tax Debt Settlement?

There are various options for settling your tax debt, including:

• Installment agreement – Allows you to pay your full tax debt in a payment plan over a set number of months.
• Penalty abatement – Can waive specific penalties and associated interest. While you must still pay the primary tax debt, it can limit your debt.
• Currently Not Collectible – A status that temporarily prevents collection actions and debt repayment requirements. This is used when you have a temporary financial issue and will be able to pay the debt in full in the future. Currently not collectible status can pause immediate payments for taxpayers facing temporary hardship while protecting assets from IRS actions.
• Offer in compromise – Lets you settle your entire tax debt for a lesser sum. It is very difficult to secure approval for an offer in compromise. In Fiscal Year 2023, the IRS accepted only 12,711 of 30,163 proposed offers in compromise, amounting to $214.5 million.

• Innocent spouse relief – This may be available if your spouse created your tax debt and you never benefited from that money.

Tax debt settlement and negotiations also benefit you by pausing collection actions.

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Is a Lawyer or a CPA Better for Negotiating With the IRS?

It is often better to work with a tax lawyer to negotiate with the IRS than a CPA (certified public accountant). Both professionals can help with different aspects of tax planning and addressing tax debt. A CPA can help you plan repayment if you are financially capable of paying the debt, while a tax attorney can represent you and your financial interests in negotiations with the IRS. Be sure that a tax attorney is licensed to do so.

Can You Write Off Debt Settlement Fees on Your Taxes?

You cannot write off debt settlement fees on your taxes. You may incur legal costs to collect or refund taxable income, but these are no longer deductible, according to the IRS. The legal expenses that you can deduct are those related to maintaining your employment or doing your job. This could include the costs of hiring a criminal attorney to defend you against charges related to your employment, but it does not include tax or other debt settlement fees.

Can a Tax Attorney Negotiate With the IRS?

A tax attorney can negotiate with the IRS when they practice debt settlement and are fully licensed in state and federal debt settlement. A tax attorney can review the specifics of your debt and financial situation and determine the potential methods to repay or settle your tax debt with the IRS. An attorney may be able to secure an installment agreement or penalty abatement. An offer in compromise is a useful tool in debt settlement, but it is hard to get.

How Do I Avoid Paying Taxes on a Debt Settlement?

In most cases, you cannot avoid paying taxes on a debt settlement. If your debt is canceled or settled for less than you owe, then the amount of unpaid debt is taxable and must be reported. There are some cases where the debt is not considered income, such as debts canceled as gifts or an inheritance or debt forgiveness under some student loan programs. Other cases are considered cancellation of debt income but are excluded from your income.

Address Your Tax Liability Effectively With TaxSmith, LLC

You can take action to address your tax liability if you can’t repay it. At TaxSmith, LLC, we can help you determine what options are right for your situation and represent you in negotiations with the IRS or DOR. Contact our firm today and let us help you.