Educational Tax Tip: Understanding IRS Notice CP12
Do you know what to do if the IRS sends you a CP12 notice? This notice means the IRS corrected your return, resulting in a different refund amount—usually an increase! The notice will include a summary of changes and a comparison of your original return with the IRS's revised figures. If you agree with the changes, no action is needed, and you’ll receive your updated refund within 4 to 6 weeks. If you disagree, you must respond with documentation within 60 days to preserve your right to appeal. Received
Educational Tax Tip: Which IRS Forms Are Eligible for FTA Penalty Relief?
Did you know that First-Time Penalty Abatement (FTA) isn’t available for every type of tax form? The IRS only allows FTA for failure-to-file, failure-to-pay, or failure-to-deposit penalties on certain returns. Some of the most common forms include Form 1040 (individual), 1120 (corporation), 1120S (S-corp), 1065 (partnership), 941 (payroll), and 940 (unemployment). If your penalty is tied to one of these, and you have a clean compliance record, you may be eligible for relief. Want to know if your return
Educational Tax Tip: Protect Your Business with Proper Tax Documentation.
Do you know which records you should keep for your business in case of an audit? The IRS requires business owners to maintain accurate records that clearly show income, expenses, assets, and employment taxes. This includes receipts, invoices, canceled checks, deposit slips, payroll records, and documentation of purchases and sales. Whether you use paper or electronic systems, your records must support the information on your tax return. Organized documentation not only helps you comply with tax laws—it
Educational Tax Tip: When Innocent Spouse Relief Doesn’t Apply
Have you ever wondered what would make someone ineligible for Innocent Spouse Relief? The IRS would reject your request if you knew—or reasonably should have known—about the tax errors when you signed the return. You're also ineligible if you miss the two-year deadline after receiving a notice or if you've already settled the issue through an offer in compromise, a closing agreement, or a court. Innocent Spouse Relief can be a valuable option, but strict rules apply. Need help determining if you qualify?
Educational Tax Tip: Managing IRS Payment Plans
Have you ever wondered if you can have more than one payment plan with the IRS? The answer is no—typically, the IRS doesn’t allow multiple installment agreements at the same time. Instead, they may let you consolidate all your tax debts into one agreement or approve a step-by-step payment arrangement. To qualify, you must show a genuine effort to pay and prove financial hardship. Defaulting on any agreement could lead to collection actions and ongoing penalties. Need help negotiating a payment plan that
Educational Tax Tip: Understand the Different Types of Tax Levies
Have you ever heard about the different kinds of tax levies the IRS or state agencies can impose? Depending on your situation, the IRS or state can seize wages, bank funds, property, or even business assets to collect unpaid taxes. For example, a property tax levy can affect your real estate, while an income tax levy might lead to wage garnishments or bank account seizures. Businesses can also face sales tax or business tax levies that put operations and assets at risk. Each type carries serious
Educational Tax Tip: Responding to IRS Notice CP09
Did you receive IRS Notice CP09 and wonder what it means? This notice informs you that you may qualify for the Earned Income Credit (EIC), a refundable tax credit that could increase your refund. It includes a questionnaire to help determine your eligibility. If you qualify, simply complete, sign, and return it to the IRS to claim the credit. Ignoring this notice could mean missing out on money you’re entitled to. Received an IRS Notice and don't know how to handle it? Visit our website and contact us
