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Old 06-06-06, 01:27 PM   #1
fordfasterr
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IRS omg omg . HELP !!!

Ok, here is the situation.. In 2004 I reported my taxes incorrectly. One of my employers never gave me the tax papers so I forgot to report $ 4616. Now, the IRS sends me a letter requesting that I pay the adjusted taxes + interest .. but here is the kicker.. After the adjustmet, I exceeded the limit for lifetime learning credits by $ 18. thats right, 18 dollars. So now they wanted me to pay them back an additional amount of $ 920. + interest.

I sent them a payment of the adjusted taxes and interest for everything but the education credits and then they wrote me a letter that they want the remainder of the balance...



Here is what I need help with..

Has anyone ever asked the IRS to give them a break ? to help them out with something like this ? I want to write a letter to them and ask them to " forgive " this small variation because I am still a full time student and this money is hard to come by ...

Any ideas ? what are my odds of getting them to give me a break ?

Any suggestions for how to word the letter to them ??

_ HELP !
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Old 06-06-06, 01:52 PM   #2
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You need to at least consult a tax lawyer. But I have never heard of the IRS just "giving someone a break." Who knows...maybe. But honestly, seek professional advice. Maybe someone on here is tax lawyer. If not, go see one. Don't get jammed up with the IRS!....that's not a good thing. Good luck with this.
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Old 06-06-06, 02:22 PM   #3
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Man, I really hope they are lenient with me...

what are the odds... ? =(
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Old 06-06-06, 02:32 PM   #4
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Quote:
Originally Posted by fordfasterr
Man, I really hope they are lenient with me...

what are the odds... ? =(
Well that depends upon
Whether you've voted republican or democrate



You should definitely see a tax lawyer. People who's whole sole and purpose is to fight IRS. They will know what to do. If you do not take care of this properly . well I'll give you an excerpt.

My parent's ran a business. As a business you can write off certain things as expenses. Often times people go all out and write off all types of ridiculous things as business expenses. My dad happened to write off a single hotel trip as a business trip. The IRs came after him and said that it was invalid despite the fact that his whole business had him travelling across multiple states.

Well they lost, needless to say. But that didn't stop them from trying again. A few years later they came back and said that they had won and that not only did he owe all the interest accrued but he also owed 25k fine + interest accrueed on it over the years. It went to court and they lost again. almost a decade later they came back AGAIN over the same thing.

My advice, is get it taken care of and get it taken care of by lawyers who were ex-IRS Especially since your problem is 100-200 times a single normal hotel stay was back in the 80's
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Old 06-06-06, 02:43 PM   #5
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If all else fails, you could always try to see if some local newspaper might be willing to do a sob story on your behalf. You unintentionally worked two hours too much that year because you are a good worker and you stay around to get the job done, and you shouldn't be punished by the IRS, the paper might say in an editorial. If you can generate enough publicity, maybe the IRS will work something out.
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Old 06-06-06, 04:31 PM   #6
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Start a revolution, or demand more representation for that $920
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Old 06-06-06, 04:50 PM   #7
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I used to work for the IRS, and I can tell you with certainty that they won't help you with this. Assuming that their recalculations are correct (there is no reason to think they're not, but you should double-check to make sure), the amount they are billing you for is your actual tax liability as determined by federal law. Nothing, and I mean nothing, will change that. Even if the people at the IRS wanted to reduce your tax because they felt bad for you, they couldn't.

They will, however, be flexible with the penalties (but not the interest) especially if you haven't had any problem with them before. And by 'flexible,' I mean that you will not likely have to pay a penalty at all (on the other hand, they probably haven't yet charged you a penalty in this situation - they know as well as you do that you just made an innocent mistake). Send in a check for the rest of the tax and interest you owe, and include a letter asking for complete abatement of any penalties you may be charged. That's the best you can do.

There are other options for challenging liabilities, getting lawyers and such, but that would be expensive and absolutely pointless given the balance you owe and the situation you describe. With media coverage, they would just explain to the reporter that this is the amount of tax you legally owe and that they would be happy to work out a payment plan or suspend collection until a time when you could afford to pay (which is true).

Also, please note that the educational tax credits are phased out as your income increases - in laymen's terms, that means you can't possibly be "punished" for making too much money - if you're eligible for the credit, making more money will ALWAYS result in you having more money in your pocket at the end of the day.

Reason #1 why everyone should keep track of the money they make instead of just depending on their W-2's.
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Old 06-06-06, 04:50 PM   #8
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The IRS will bargain, just not in this case more than likely. They resort to that when a tax payer is in no position to pay them. The IRS typically keeps lousy records and has moderate to poor customer service, and like most institutions it moves very very slowly, but it does move. Call them up, keep track of who you talk to and what they say, work out a payment plan and pay them back. Best way to deal with them is avoidance of the situation if possible, once in their system and in their crosshairs you are F'd. Its a big scam and a game, they will cheat whenever they can and expect you to do the same. They dont tell you all the rules, they make you find out on your own, and ignorance isnt an excuse. BTW, you work for someone else and sign a W-4, you lose massive amounts of leeway or protection from them. Its their game, and they have it rigged for them to win, imagine that.
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Old 06-06-06, 04:57 PM   #9
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I paid the increase in taxes + the interest in the amount of about $ 850 ...

The remaining $ 920 is what they want me to pay BACK to them due to exceeding the education credit income cap.

Basically, they let me keep $ 920 back in 2004 because I was a student and I paid x amount of money to be in school... now, since I exceeded the cap they had set back in 2004, they want me to pay back the $ 920 tax break that they gave me...

I exceeded the cap by $ 18 .

ouch!
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Old 06-06-06, 05:01 PM   #10
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part of financial planning is dealing with taxes, they dont accept excuses, so be prepared ahead of time...or pay the consequences OR if your HUGEco with a big govt lobby spend some $$ and grease some palms or move the $$ offshore
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Old 06-06-06, 05:08 PM   #11
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Quote:
Originally Posted by fordfasterr
I paid the increase in taxes + the interest in the amount of about $ 850 ...

The remaining $ 920 is what they want me to pay BACK to them due to exceeding the education credit income cap.

Basically, they let me keep $ 920 back in 2004 because I was a student and I paid x amount of money to be in school... now, since I exceeded the cap they had set back in 2004, they want me to pay back the $ 920 tax break that they gave me...

I exceeded the cap by $ 18 .

ouch!
please reread what I said about credit "phaseout." you may have only exceeded the cap by $18, but they chip away at your credit until you hit the limit. they don't just take it away all at once. If your income was $20 less, you would still end up owing a similar amount.

also note that there are quite a few different tax benefits for education, many of which have different income cutoffs. you may be able to get some of that money back by filing an amended return. if you send me the figures (i.e. EVERY FIGURE), both from your original return and the notice they gave you after they made the changes, i could let you know with more specifics.

Quote:
Originally Posted by pedex
The IRS will bargain, just not in this case more than likely. They resort to that when a tax payer is in no position to pay them. The IRS typically keeps lousy records and has moderate to poor customer service, and like most institutions it moves very very slowly, but it does move. Call them up, keep track of who you talk to and what they say, work out a payment plan and pay them back. Best way to deal with them is avoidance of the situation if possible, once in their system and in their crosshairs you are F'd. Its a big scam and a game, they will cheat whenever they can and expect you to do the same. They dont tell you all the rules, they make you find out on your own, and ignorance isnt an excuse. BTW, you work for someone else and sign a W-4, you lose massive amounts of leeway or protection from them. Its their game, and they have it rigged for them to win, imagine that.
the IRS keeps great records for some things, no records for others. and I agree about the customer service, that's what I did there, and the limitations of the system (as well as most of the employees) are very frustrating. anyway, this is a situation where they keep great records. the IRS will not bargain over the existence of a liability when it's based on W-2 income.

and you are more than right about being ****ed when you work for someone else, if you aren't a megacorp, being self-employed and simply lying about your income and expenses is the only surefire way to cheat on your taxes and get away with it. almost always get away with it, at least.
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Old 06-07-06, 01:01 PM   #12
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Quote:
Originally Posted by fordfasterr
One of my employers never gave me the tax papers so I forgot to report $ 4616.
Here's my "I'm not a lawyer, but I stayed at a Holiday Inn Express last night" answer.

If you mean that you employer didn't provide you your W2s by 2/14/04, then that is a federal violation. You may have recourse against the principals of that organization to recoup all your losses.

As far as the "give me a break" strategy... good luck with that.

Now get yourself a tax attorney and stop asking stupid questions and waiting for stupid answers.
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Old 06-07-06, 01:04 PM   #13
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Quote:
Originally Posted by telenick
Here's my "I'm not a lawyer, but I stayed at a Holiday Inn Express last night" answer.

Quote:
Originally Posted by telenick
If you mean that you employer didn't provide you your W2s by 2/14/04, then that is a federal violation. You may have recourse against the principals of that organization to recoup all your losses.
Damn straight
Quote:
Originally Posted by telenick
As far as the "give me a break" strategy... good luck with that.
He'll probably need some KY to go with that
Quote:
Originally Posted by telenick
Now get yourself a tax attorney and stop asking stupid questions and waiting for stupid answers.
For the umpteenth time. YEP
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Old 06-07-06, 02:06 PM   #14
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Quote:
Originally Posted by fordfasterr
Has anyone ever asked the IRS to give them a break ? to help them out with something like this ? I want to write a letter to them and ask them to " forgive " this small variation because I am still a full time student and this money is hard to come by ...
The only people that the IRS forgives are megga tax payers like Exxon. It is routine to noc off millions from what they owe.
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Old 06-07-06, 02:51 PM   #15
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While your at it check and make sure that that employer actually paid your SS tax. You only have a few years to make a claim on that. They could have deducted it and not paid it. Check with the Social Security and make sure that they paid that!
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Old 06-07-06, 03:50 PM   #16
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Call the IRS at 1-800-tax-1040. Explain your circumstance. they will abate penalties if you can show "reasonalble cause". Interest is never abated and the fact that you went over $18 means you are not entitled to the credit. You will owe that.

Ask then about an installment agreement. They will give you up to 5 years to pay it off as long as you make a payment a month of at least 1/60 the amount due.

Trust me.......... I too stayed at a holiday in express last night.
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Old 06-07-06, 04:07 PM   #17
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1. Complain on the internet.

2. Email them this thread with an attached list of "demands" and "consequences" should your wishes not be fufilled...

3. Threaten them.
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Old 06-07-06, 07:01 PM   #18
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Quote:
Originally Posted by telenick
Here's my "I'm not a lawyer, but I stayed at a Holiday Inn Express last night" answer.

If you mean that you employer didn't provide you your W2s by 2/14/04, then that is a federal violation. You may have recourse against the principals of that organization to recoup all your losses.

As far as the "give me a break" strategy... good luck with that.

Now get yourself a tax attorney and stop asking stupid questions and waiting for stupid answers.
and if the company put the W2 in the mail to the address they had on file when the OP stopped working there, they did all they needed to. and even though the company has to send the W-2's, all taxpayers are required to keep track of how much money they earn themselves. I dealt with literally over a thousand people in the OP's situation, it always sucks, but there really is no way around it besides paying your taxes just like the rest of us do.
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Old 06-08-06, 08:31 AM   #19
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I called the hotline: 1-800-tax-1040 .

I explained my situation and they told me that I am screwed and I must pay back the education credits and that the IRS does not make exceptions for anyone regardless if they exceeded the income cap by even 1 dollar.

They told me to look at pulibcation # 970 to see if I qualify for some other kind of tax breaks so I'm going to look into that ...

damn =(
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Old 06-08-06, 08:59 AM   #20
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I called the hotline: 1-800-tax-1040 again...

I found out that I can file for education expenses deductions..

So I spoke to some people and they helped me fill out a new tax return for 2004 and guess what ?

The IRS owes me $ 190.

YESH !!!!!!!! =)

- Thanks to all the help from everyone here !!!

Last edited by fordfasterr; 06-08-06 at 10:20 AM.
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