By Chelsea Victor
Redstone Review

“A fool and his money are soon parted… while the rest of us just wait for tax season.” – Anonymous

LYONS –  Regardless of political affiliations or personal opinions of fiscal responsibility, a staggering number of Americans on both sides of the pendulum are finding themselves behind on their taxes and on the radar screen of the IRS. Some are delinquent and owing because they ran out of money at the end of the year; others didn’t understand how to make a  941 deposit; some had a professional who made some serious mistakes; and some are just good ol’ fashioned tax protesters who believe the constitution says they don’t have to pay income tax. Regardless of how they got in, they are all in the same boat: floating into a stormy sea comprised of penalties, interest, intimidating notices, liens, levies, garnishments, and of course, the stress and embarrassment of being in trouble with Uncle Sam.

Even more potentially threatening than all these are the companies that promise to take care of it all by showing you how to “pay pennies on the dollar” for your past due federal taxes. The good and bad exist in every industry, but the bad are always worse in the industries that involve people who are already in a vulnerable position.

And people who have tax liabilities are incredibly vulnerable for two reasons. They are up against an entity whose very name is synonymous with power and intimidation; and they tell no one about their situation because of the negative stigma that exists towards people who are in trouble with the IRS.

It never ceases to amaze me that people will openly ask for help when they are sick, have problems in their marriage, need a good DUI attorney, and have problems with their children; but when it comes to being in trouble with the IRS, they tell no one. This makes them easy prey for scam artists and large companies that subject them to ridiculous fees and charges, or even worse, “value billing.”

The truth of the matter is, there are hundreds of thousands of people who are behind on their taxes or delinquent in their returns, and yet, people are hesitant to get help because they are afraid to identify themselves and risk being ostracized from the community.

Fortunately, the majority of people don’t really subscribe to the belief that individuals who have tax troubles are bad people or bad business owners. Rather, most people can likely empathize with their frustration, as taxes are difficult and confusing, and sometimes coming up with the money at the end of the year is tough, if not fiscally impossible. Even Albert Einstein understood this frustration, saying, “The hardest thing in the world to understand is the income tax.”

So now the question on everyone’s mind: can you really pay pennies on the dollar for your IRS taxes? As with any area of law, there are some loopholes. There have been situations where people who owed incredible amounts of money to the IRS walked away without paying anything. And the IRS does have methods of resolving tax debt that can result in you paying less than what you owe through various products, such as offers in compromise, penalty abatements, etc. But understand that paying less than what you owe on your tax liability is not the norm, but rather the exception.

Be wary of hyper salesmen who make promises over the phone in exchange for large retainers, but will not actually be representing you. If you owe back taxes, the very last thing you need is to waste money. Protect yourself: do research on a company before you send a check; open up about your tax liability to people you trust, as they may be a great resource for you because, shockingly, they may have been through it before (but of course never told anyone). Better yet, get a free consultation with a local attorney! (You could see that coming, right?) Most importantly, don’t avoid the issue in hopes that the IRS will forget about you. He’s your Uncle Sam, and he remembers you at least once a year.

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