Negotiating back-taxes with the IRS

Tax negotiation representation can help taxpayers needing assistance with their tax issues. Tax issues can involve many different kinds of problems including inability to pay, release of liens and audits. A qualified negotiator has seen every kind of problem taxpayers experience and knows how develop workable solutions with the agreement of the IRS.

Victim Mentality

There’s a kind of victim mentality that taxpayers develop when they have tax related issues with the IRS. This mentality is one of resignation and fear that the IRS can do whatever they want including threatening everything you’ve spent your life building. This mentality was fostered during 3 decades through the 1970s, 1980s and most of the 1990s as people read stories about taxpayers losing their homes, business and a large part of their paychecks.

The IRS is like the giant blob in the old science fiction movie, eating its way through assets and bank accounts. The victim mentality is understandable except for one thing – times have changed. Taxpayers now have certain rights that have given them negotiation power, and yet they still live in fear of the IRS. With tax negotiation representation, you have the ability to keep the IRS from eating its way through your assets.

The reason is for the fear is the fact the IRS doesn’t make the negotiation process easy despite the creation of taxpayer rights. The IRS will seize and lien and attach and levy without breathing a word about your rights. Tax negotiation representation can insure your rights are protected and the IRS does what it should be doing – working out a compromise.

The victim mentality is dangerous, because it causes inertia. You keep getting the IRS letters and notices in the mail and just keep telling yourself it’s hopeless. But there’s not a tax issue in the world that’s hopeless.

Believing in Success

Instead of maintaining a victim mentality, you should take advantage of having access to tax negotiation representation. A tax negotiator can work with the IRS on your behalf in order to find ways to resolve your tax problems. These solutions may include one of the following.

* Offer in Compromise

* Audit representation

* Penalty abatement

* Lien and levy release

* Business tax negotiation

* Installment payments

The IRS has a lot of programs that they don’t like to talk about while trying to collect money. A tax negotiator makes sure the discussion occurs so that you can obtain tax relief. A tax expert can deal with both personal and business tax problems.

If you are quietly accepting all the grief the IRS is doling out during the collection process, you probably have the victim mentality. Getting tax negotiation representation can show you how to shed the victim mentality and assume a proactive attitude about your taxpayer rights. The relief you’ll feel goes far beyond tax relief.

Why the new housing bill is (almost) useless.

As you know the Senate has just recently approved the new Housing Bill designed to help American Homeowners keep their homes.  For those of you that read the verbage for the bill but did not understand it this is the breakdown:

• You must have obtained the mortgage between Jan 2005 – June 2007.
• More than 40% of total income must be spent towards housing payments.

Ideally if you meet these two conditions then you’ll be able to write down the value of your mortgage to 90% of the value of your property and go with a more reasonable rate since you’ll going into an FHA-backed mortgage.  Everything sounds good doesn’t it?  Not really, not once you read the rest of the verbage and go over the costs.  First off not only will you be paying mortgage insurance with the new mortgage you’ll also have to do profit sharing with FHA.  In the 1st year you’ll have to give 100% of all profits to FHA after which it will be 90% for the 2nd year and will continually drop 10% every year after before bottoming out at 50%.  What that means is 30 years from now if you own a 1.5 million dollar property you will still owe 50% of your equity to FHA.

Some of you may be thinking that this is the only alternative option available to you short of foreclosure however in many cases you can do a loan modified by negotiating directly with our bank instead of going through the FHA process.

For those of you that are unaware of what a Loan Modification is, a Loan Modification is a permanent change in one or more of the terms of a mortgagor’s loan, allows the loan to be reinstated, and results in a payment the mortgagor can afford.  Or, to simplify, it means that you can have your mortgage reworked to give you a more affordable payment.  Generally how the loan modification process works is the Loan Modification company (LM) will contact the current lender on a homeowner’s house and request that they redo the mortgage by either dropping the balance or the interest rate (or both) to make it more affordable for the homeowner.  This is not always successful because these days every Tom, Dick, and Harry will call himself a Loan Modification Company and try to negotiate for you.  Keep in mind the reps that the LM will be dealing with are experienced and receive thousands of call everyday from someone trying to renegotiate their mortgage.  It is not uncommon for a homeowner to hire ABC Loan Modification ‘r us (who is actually ABC ex-Mortgage brokers ‘r us) to handle a loan modification, who will in turn try to negotiate for weeks going nowhere.  The process will drag out for months, nothing will happen, and the homeowner will go into foreclosure.  In any case the LM will walk away with the “upfront consulting fee” or “commitment fee” (ranging from $1,500 up to 2% of the loan balance).

The best option would be to do an attorney-based loan modification program.  How this works is an attorney will audit your loan that you have with the lender.  If any errors are found on your loan documents the attorneys will build a case for you and sue the lender on your behalf to rescind the loan.  If the loan cannot be rescinded they can renegotiate your mortgage down 90% of property value @ 6% fixed.  This will end up being the best option for homeowners.  Let’s face it if you are deciding whether to use the provisions in the housing bill or the loan modification program, that means that you’re planning on being in the house for the long haul.  I saw a special on CNN where and there are more and more attorney-based loan modification companies in Florida and California (where foreclosures are at the highest rate) popping up.  This trend has yet to affect the foreclosure rates but I believe in a year or two you’ll see an effect.  

For those of you interested in learning more about attorney-based loan modifications, you can either google it or search on the cnn website.  One company that was highly recommended in the media was Saving the American Dream (800-515-9603)

Dealing with Debt

This blog is intended for readers interested in getting out of debt.  With the amount of Americans drowning in debt on the rise I have started this blog to answer many questions for those living in a world of uncertainty.