Monday, September 30, 2013

Offer In Compromise Saves Client $65,000!

Our client came to us with an unpaid trust fund balance totaling over $100,000 before we filed his offer in compromise.  The debt stemmed from a business he ran that accrued over $300,000 in payroll tax debt. We assisted him with the closure of the business, thus leading us to the determination we would file an offer in compromise for him. When he came to us he was over the age of 80 years old. Between him and his wife, they had plenty of money in both the equity in his home as well as her retirement account to fund full payment of the liability. This case was going to be a tricky one in order for us to get an offer in compromise filed and accepted.  Usually when you show the IRS via offer in compromise you can pay the IRS in full, they expect payment in full.

We decided to file a effective tax administration offer in compromise. An effective tax administration (ETA) offer in compromise is filed under the premise that even though the taxpayer has the ability to fully pay the tax debt in full, doing so would create a hardship. An ETA offer in compromise requires financial data as well as factual data based on the facts as to why the taxpayer cannot fully fund the tax liability. Therefore, we put together the offer in compromise with all financial data as well as reasoning showing the taxpayer was 82 years of age, needed all of his retirement rightfully so, and even though his wife could fully fund the liability with the equity in the home, she was not responsible for the tax liability.

The IRS initially rejected the offer in compromise indicating the taxpayer could refinance, or obtain a reverse mortgage in order to fully pay the liability. However, after much research, we concluded if the taxpayer decided to refinance or obtain a reverse mortgage there were not only too many risks involved but the costs associated with obtaining the $100,000 to fully fund the tax liability would encroach on the wife's portion of the equity.  We also argued reverse mortgages are not the best for a taxpayer given the risks associated with a reverse mortgage.  Certain risks such as high interest rates, higher closings costs, as well as potential foreclosure if one spouse dies and the other continues living in the home are just some of the risks associated with the process.

After our arguments and showing the IRS our offer in compromise should be accepted, the IRS finally agreed to an offer amount of $35,000. The taxpayer has already paid $7,000 and therefore has $28,000 remaining to be paid within the next 5 months. Once the taxpayer has paid the $28,000 he must remain current and compliant for a period of 5 years, the IRS will snag any refunds due on the 2013 and 2014 tax returns, and he must not accrue any additional debt through another business entity.

At Highland Tax Group, Inc. we are proud to say the ETA offer in compromise was accepted. Check us out at or call me at 720-398-6088 to see if you qualify for something similar!

Thursday, September 19, 2013

IRS Releases Announcement Regarding Severe Storms in Colorado

The IRS is providing tax relief to individual and business taxpayers impacted by severe storms, flooding, landslides and mudslides in Colorado.
The IRS announced today that certain taxpayers in the counties of Adams, Boulder, Larimer and Weld will receive tax relief, and other locations may be added in coming days following additional damage assessments by the Federal Emergency Management Agency (FEMA).

The tax relief postpones certain tax filing and payment deadlines to December 2, 2013. It includes corporations and businesses that previously obtained an extension until September 16, 2013, to file their 2012 returns and individuals and businesses that received a similar extension until October 15. It also includes the estimated tax payment for the third quarter of 2013, which would normally be due September 16.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 866-562-5227 to request this tax relief.

Practitioners located in the covered disaster areas who maintain records necessary to meet a filing or payment deadline for multiple taxpayers outside the disaster area may contact the IRS to identify such clients using the procedures described on the IRS website. The relief typically applies to taxpayers in collections, dealing with a Revenue Officer, Audit, Appeals, Offer In Compromise, or in another collection matter concerning the 

The IRS encourages taxpayers and tax practitioners to monitor the Tax Relief in Disaster Situationsin for updates.

If you have further questions please call me at 720-398-6088 or

This article was provided by the following organization: 
National Association of Tax Professionals (NATP)
PO Box 8002
Appleton, WI  54912-8002

Monday, September 9, 2013

Highland Tax Group, Inc. is Open for Business!!

Highland Tax Group, Inc.
September 9th, 2013 

Highland Tax Group, Inc. is Open and Operating!!  

KW & Associates, Inc. is now dissolved and I have opened Highland Tax Group, Inc. Please expect all future emails, blog posting, and correspondence to come from Highland Tax Group, Inc. directly. 

My new contact information is below:

Highland Tax Group, Inc.

P.O. Box 140310
Denver, CO 80214
p. 720-398-6088
f. 855-660-6830

Stay tuned for information concerning Highland Tax Group, Inc., news concerning the IRS, successful resolutions, and more! 
Thank you for reading and I look forward to working with you in the future.