So Simple, Yet So Difficult. Pay Your Taxes On Time

There is an easy way for real estate agents to stay out of trouble with the IRS…

• Get your EIN and set up a business ONLY bank account and credit card
• Keep accurate books that are reconciled to the bank and credit card statements every month
• If you are not keeping accurate books and want to stay out of trouble, there is always the safe harbor method.  If your prior year AGI was under $150,000, pay 1/4 of the previous year’s tax each quarter. AGI over $150,000? Multiply the previous year’s tax by 110% first. 
• Quarterly estimates are due 4/15, 6/15, 9/15, 1/15 (following year). File and pay on time! See https://www.irs.gov/pub/irs-pdf/p505.pdf for estimated payment details
• Payments can be made online at https://www.irs.gov/payments for federal payments and https://drs.ct.gov/eservices/ for CT
• By not making estimated payments and waiting for April, you will incur interest and penalties. If you expect to owe over $1,000 in taxes for the year, estimated payments are required

What If I Cannot Pay My Taxes On Time?

• If you underpaid or did not make estimated payments throughout the year even though required, you will most likely owe money in April (as well as penalties and interest)
• Keep in mind, an extension to file your taxes from April to October is NOT an extension to pay taxes owed, only to file the paperwork
• Even if you cannot pay the tax, ALWAYS file your 1040 on time! This will get the assessment and collection statutes to start running. This is very important and may save your skin one day!

HELP! I Am Getting Threatening Letters from the IRS

• Do not ignore letters from the IRS. Always read them. Many are time sensitive and you will lose important rights by not timely replying
• Letters you may receive:
  • CP14: We know you’re out there
  • CP501: We recently contacted you. You must pay immediately
  • CP503: Pay now or we MAY levy your assets
  • CP504: Final Balance Due Reminder. Last chance before a levy
  • CP90, LT11, 1058: You now have CDP appeal rights
• Short term installment agreement for 180 days. This is DIY. Up to $100,000 owed including penalties and interest. Call 877-777-4778 to set it up
• Guaranteed Installment Agreement for up to $10,000 for 36 months or by the end of the collection statute. This is DIY. Call 877-777-4778 to set it up
• If you owe above $10,000 or more you will need to file online at https://www.irs.gov/OPA or by filing form 9465 for an installment agreement. https://www.irs.gov/pub/irs-pdf/f9465.pdf. This can be DIY. If you owe over $25,000, consider using a Certified Tax Resolution Specialist such as the Connecticut Tax Resolution Service. We’re trained and experienced specifically in taxation resolution to assist you better and ensure you get the best option possible with the IRS.
• The Connecticut Tax Resolution Service will fully analyze your current financial situation to determine the best resolution that is comfortable for you. An analysis may uncover strategies that may not be apparent at first glance, or to an untrained eye.
• Other options include:
  • Installment Agreement: Up to 72 months
  • Partial Pay Installment Agreement: Based on affordability
  • Penalty Abatement: First time penalty or reasonable cause
  • Offer in Compromise (DATC): Gold standard, but hard to get
  • Offer in Compromise (DATL): You don’t owe the money
  • Currently Not Collectible: IRS can’t get water from a stone!
  • Bankruptcy: Beware! May NOT discharge all taxes

• Set up a consultation with us by clicking here
• Click on the button to download our brochure