7 Tips For Negotiating With The IRS

I’ve spent decades negotiating with the IRS, so take it from me, these tips are solid.

From Fox Business.com:

From time to time every taxpayer will have to go head to toe with the IRS. Whether you are setting up an installment agreement, facing the auditor from hell, resolving a misunderstanding, or dealing with collectors on the phone or worse yet, on your doorstep, you would be well advised to heed the following suggestions.

1. You get more flies with honey. Dealing with bureaucracy can be very frustrating, but park your bad attitude and anger at the door. Take a deep breath, demonstrate a cooperative attitude, and proceed in an orderly fashion to resolving your issue. In my 28 years of dealing with the IRS, I have found that most IRS personnel are compassionate humans that bend over backward to find ways to resolve issues and help taxpayers. Of course you are going to run into that power-hungry, condescending, surly agent from time to time, but if you do, you can always trade up to a more understanding and respectful model by asking for the manager.

2. Use IRS lingo. When you use IRS lingo the agent you are speaking with will find you knowledgeable and may treat you with a little more respect. Here is some verbiage you may find useful:

• Ask for penalties to be “abated” rather than removed.

• Tell them, if it’s the case, that your failure to (pay or file or comply with a document request) was due to “reasonable cause.” Use this term if you didn’t just flake and have a good reason, which could include such things as unemployment, losing your records, losing your home, health problems, etc.

• If you can’t pay a tax bill because you are suffering financial reversals, you can ask to be deemed “currently not collectible.” If you are granted this status, they will leave you alone for an entire year while you get it together.

• If you feel a spouse or former spouse should be responsible for a tax matter, ask to be treated as an “innocent spouse.” There are certain criteria to this status; do some research or discuss the issues with your tax pro.

• If defending business deductions during an audit, the term “ordinary and necessary” business expense will help--but only if that’s really the case.

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President Obama Directs Administration to Crack Down on Tax Cheats Seeking Government Contracts

In a new press release from the White House the Obama administration has directed the Office of Management and Budget, as well as the Treasury Department and other federal agencies, to take steps to block contractors who are delinquent on their taxes from receiving new government contracts.

He will also direct the IRS to conduct a review of the overall accuracy of companies’ claims about tax delinquency to be sure that when a company says it is paying taxes, it is telling the truth. The President will be joined today by Vice President Biden, Senator Claire McCaskill, Congressman Ed Towns, Congressman Brad Ellsworth, IRS Commissioner Douglas Shulman, and Chief Performance Officer of the United States Jeffrey Zients.

In addition, the President is calling on Congress to give the government the tools necessary to ensure that the public’s tax dollars are not used to boost the profits of companies who refuse to pay their taxes.

“By issuing this directive, all of us in Washington will be required to be more responsible stewards of your tax dollars. All across this country, there are people who meet their obligations each and every day. You do your jobs. You support your families. You pay the taxes you owe – because it’s a fundamental responsibility of citizenship,” said President Barack Obama. “The steps I’m directing today and the steps I’m calling on Congress to take are just basic common-sense. They’re not going to eliminate all of the waste or abuse in government contracting in one fell swoop. Going forward, we’ll also have to do more to hold contractors more accountable not just for paying taxes, but for following other laws as well.”

Milwaukee Brewers First Baseman Owes the IRS $409,149

Yesterday Detroit News broke the story that Prince Fielder, who plays for the Milwaukee Brewers, owes $409,149 to the federal government in unpaid taxes. Prince is the son of former Detroit Tiger great, Cecil Fielder, who currently manages the independent league Atlantic City Surf baseball team.

The apple apparently does not fall far from the tree as Cecil had financial problems of his own four years ago. According to public records, he lost $47 million through bad business decisions. However, Cecil and Prince have not spoken in years after Prince accused his father of money extortion.