Liens, levy’s, wage garnishment, back tax debts of all kinds. If you’re facing any of these tax debt problems. Stay tuned for the next 30 minutes. This is the Levy Tax Help Show presented by Levy and Associates of Delray Beach. Tax Resolution Specialists, call Levy and Associates 24 hours a day, seven days a week with all of your civil tax questions 1 800 TAX-LEVY. That’s 1 800 829-5389. Now the Levy Tax Help Show.
Lawrence Levy: Good Morning South Florida and welcome once again to the Levy Tax Help Show. We hope that everyone is having a great weekend and we hope that you had a great week. Weather in Florida pretty good this week, but we’re not here to talk about the weather. We are here to talk about what do you do if you have an IRS problem. What do you do if you haven’t filed your returns in a few years and what do you do if you are getting my last name thrown around a bit. LEVY and Yes, Levy really is my last name. Let me introduce everyone, reintroduce say hello again because Greg been around for a while the Levy office. Greg Mahaffey was a former IRS revenue officer that worked at the IRS for, Greg how long,
Greg Mahaffey: Thirty-two and a half years.
Lawrence Levy: I love how he always says thirty-two and a half. So obviously you were you were counting clearly but awhile, longtime over 30 years, three decades is a long time working for Uncle Sam and I’ll bet you a maybe ten years ago. Twelve years ago, you never thought you’d have your paycheck signed by a guy with the last name Levy of all things. Pretty crazy.
Greg Mahaffey: Oh yeah.
Lawrence Levy: But Greg has been a tremendous asset to the firm. We now have three former IRS revenue officers and we’re gonna try and get next week or the week after one of the latest additions, her name is Mindy Gonzalez and Mindy used to work as a revenue officer for about 25 or 26 years and then she rounded out her career as a GM, what’s called a group manager, at the IRS and she’s now joined our team and we actually talk about one of her files this week. But before we get into that, I don’t think we give the phone number out enough and the phone number locally is (561) 865-7800 and toll free 1 (800) TAX-LEVY. And yes, Levy really is my last name. And Greg I want to also say a big thank you for your service to the country. We always like to give a shout out to the military, the first responders, the firefighters, the police officers out there. We don’t think that you get enough credit especially in today’s world. We like to say thank you and Greg was in the Navy right.
Greg Mahaffey: Oh yeah.
Lawrence Levy: You weren’t on a submarine really you weren’t in a submarine.
Greg Mahaffey: Are you kidding.
Lawrence Levy: Right. You were you were.
Greg Mahaffey: I was on a big lumbering supply ship off the coast of Kuwait City in early 1991. In the middle of the oil slicks and minefields. doing do diligence duty working 20 hours a day sometimes.
Lawrence Levy: Well thank you for your service. And I was kidding about the subs but I know you’re a big fan of submarines and you’re a movie buff with subs right. Hunt for Red October, U571. We are not hear to talk about movies. We’re not here to talk about the weather but thank you for your service to the country. Let’s start off with a good example of this week. A doctor, nice guy, relatively new client in the Levy office, about a month old being a client in the Levy office, came to us with a wage levy and hasn’t filed, let’s see how many years it’s been. So, he has not filed for is it 12 13 14 15 16. Yeah. Delinquent tax returns and 17. So last return was 2011. So Greg, earlier this week which would have been on Tuesday, you were able to cal this is called ACS, automated collections. And you were able to get this gentlemen’s wage levy released which now has given him a little bit of a breathing room because he’s got to be able to pay someone to file his five years of delinquent tax returns. And as a revenue officer, that’s what was really a difficult thing for me to always sort of understand that the IRS is going to levy. And then you don’t have money. Bank levy, wage levy. So how do they think you’re gonna go out and you’re gonna be able to pay an accountant to prepare five years of six years of tax returns when your cash flow is either eliminated or certainly crippled. It just doesn’t make any practical sense. Obviously, the answer to that is, there’s consequences when someone doesn’t file their tax returns when they don’t pay what they owe. But I’ve never really understood how that’s logical. And I bring this up because earlier this week on Tuesday we were able to get that levy released. I actually was talking to Mindy about this and once she’s on the show we’ll talk about it a little bit. We have another client that I want to talk about because it’s a really practical example. But Greg, can you give everyone a little bit of when they have a wage levy, a lot of people, they go into panic mode and they don’t know what to do. You should always seek professional advice and you always want to have someone represent you because the average person out there, the average taxpayer, in a million years, wouldn’t know what to do. Here’s a doctor. This guy’s a smart guy. Nice guy by the way. I think he’s married if I’m not mistaken. Right. And Greg he’s married. Yeah, he’s married but the wage levy was in his name and the IRS says he owes, I think it was just under sixty thousand dollars is that right.
Greg Mahaffey: Something like that. Yeah.
Lawrence Levy: Let me pull it up real quick and I’ll tell us what it was. But yeah. Was six thousand So Greg you were able to call and that the letter the wage levy was issued early on in September, September 7th. And it was just under sixty thousand dollars that this gentleman owed with liabilities going back to 2008. So it went back and went back pretty far. So it is going back 10 years. But Greg you’ve called ACS and you were able to get a reasonable human being on the other end of the line and you were able to have them release the levy and that all happened within a matter of a couple of hours of going through some of the financials and explaining the practical matter of it and the rep that you talked to which was late in the day, it was 5:30 – 6:00pm Eastern Time on Tuesday. It was a very nice rep. I happen to walk by your office and hear you on the phone and she was incredibly nice and it makes it nice to deal with someone who’s nice in the IRS world. So Greg, now you gave this guy a piece of mind. I’m actually looking at the release that was sent over to you earlier this week. And how good does that make you feel that you were able to help out this family in their time of need. It should make you feel pretty good.
Greg Mahaffey: Yeah it does. Especially what we have to do is we approach it from a logical perspective. We need money in order to get the returns prepared. They just don’t get prepared by themselves. There’s a complicated set of returns that need to be done. They weren’t going to be cheap. They weren’t going to be easy and something taxpayer could not do himself. After the returns are prepared, there may or may not be any additional balances do. We don’t know until the returns actually get prepared. But because of the wage levy and now this taxpayer is a wage earner he works for someone else now. He’s lucky he didn’t lose his job over this issue but he did not lose his job. And we got him the relief that would be needed so he can continue on with his life, so he can concentrate upon getting these returns filed. He has a deadline. He knows the consequences. We’re diligently working and busting our tails to get these things done for him within this timeframe. So, once they are filed taxpayers then filing is in compliance, then we can go back and make a proposal to the IRS how to resolve the balances do for everything. All this use taxpayer will not over 2017 or 18 going forward. He had sufficient withholding. So now that he’s a wage earner he does have to worry about estimated tax payments. So, the case boils down to what does he own. What does he have? What’s his income? What’s his expenses? What can we start paying the IRS? Once everything is resolved and we get him back into compliance. But we have to jump through many many hoops which is why you need a professional firm out there who knows what they’re doing. He tried doing this on his own he failed miserably. He got his wages levied. He almost lost his job. He came to us and we got it done within less than what a week. Less than a week we got the relief. I stay here late last evening after 7 o’clock just to get him the forms that would be needed and released him take it to his employer the following day.
Lawrence Levy: It was great how you were able to get all that handled, and I’ll tell you something, a lot of people they just go into this panic mode. Another example that happened earlier this week. Mindy took on another file and it was again a similar ACS levy. So, ACS stands for automated collection. So if everyone’s listening to these sort of technical issues, Greg, Mindy & Claire the three people that work for me now used to work for the IRS all as revenue officers originally and they were the ones who would knock on the door. ACS is a different division of the IRS which is called automated collection system and Mindy again called the IRS ACS collections division and this gentleman had a wage levy and he hadn’t filed in six or seven years. And when they said he owed just over fourteen thousand dollars. Nice guy again hasn’t filed, married and just wanted his life back in order. So after less than 24 hours of him being our client earlier this week it was on Tuesday late in the day and the levy got released sometime midday on Wednesday. The guy is just a happy guy and now he can afford to live. And he also has to afford to get his tax returns done. So, there’s some logic that goes on in that. If anyone listening today is staring down the face of an IRS wage levy or bank levy for that matter, you give us a call immediately. Saturdays we love. Greg’s in typically every Saturday except for last week when there’s little bit of construction going on in the Levy office but he’s usually in every weekend and we’re here Saturdays and Sundays and we enjoy the weekend interaction, we enjoy that. Phone number locally. I don’t give it out enough. (561) 865-7800. That’s (561) 865-7800 or 1-800-TAX-LEVY. And yes. Levy really is my last name. Let’s jump to another file that’s pretty recent. From this week officially, although the file started back about 10 days ago or so. A gentleman came to us as a referral from a local CPA who doesn’t specialize, local meaning Broward or Palm Beach County, southeast Florida, and the gentleman owes the IRS just under fifty thousand dollars and he’s got a penalty notice that I’m going to pull up and he has several penalties on this. Failure to file penalty of over twenty-two hundred dollars, failure to pay a penalty of almost a thousand plus interest of almost eight hundred. So there’s a decent amount that’s out there and there’s some reasons behind why the tax return didn’t get filed. It was almost, we’ll call it computer error and the electronic filing issue and a transmission issue. So Greg, can you walk everyone how penalty abatement works within the IRS, first time penalty abatement. Actually, let’s not even go there. How about reasonable cause. What is the basis for a reason that would cause the IRS to get rid of penalties?
Greg Mahaffey: Reasonable cause is basically where a taxpayer took all prudent measures, prudent business care in the way they operate to ensure that the taxes were filed, the taxes got paid but due to unforeseen circumstances beyond their control. Things got out of hand. Things didn’t get paid. Things didn’t get filed and things just became basically a nightmare for the taxpayer. Perhaps they were embezzled. Perhaps someone close to the family was suffering from terminal cancer and the taxpayer was taken away from his business obligations. It could be one of many different things. The IRS does abate penalties but it’s not because you’re a nice guy. They abate penalties and they have very strict, what they call, reasonable cause guidelines. There’s actually a reasonable cause manual that they actually have which I have a copy of on my desk somewhere along with everything else that’s constantly updated as court cases come in. As things change, as procedures change and basically that’s why you need a professional who knows what reasonable cause is, what it isn’t and when do we actually fight for you. If the IRS should try to deny abatement of penalties and then we can go to appeals. Reasonable cause, here’s the key. You took prudent business measures to ensure the tax obligations were satisfied but due to unforeseen circumstances. Another reason why a lot of times businesses get in trouble, they get embezzled. They’re victim of embezzlement and those are a little tricky to show. But we have the ability when that is the situation. You have to show where a police report was filed. There’re many other hoops that had to be jump through. Which is why you need a professional to fight on your behalf.
Lawrence Levy: So reasonable cause, I’m going to read write off the IRS Web site. Reasonable cause is based on all the facts and circumstances in your situation. We will consider any reason which establishes that you used all ordinary business care and prudence to meet your federal tax obligations but were nevertheless unable to do so. They give you a few typical situations. Fire, casualty, natural disaster, the inability to obtain records, death, illness, serious incapacitation, unavoidable absence by the taxpayer. Other reasons which establish that you used ordinary business care and prudence to meet your federal tax obligations. So, what happened, when did it happen. How did the facts and circumstances affect your ability to file or pay. What changed. What did you take to correct, take corrective action? So, there’s a lot of things that you need, hospital records, documentation of the natural disaster, physician letter to establish the illness or the incapacitation. So, the interest on the tax cannot be abated, interest charge on the penalty will be reduced if and when the penalty is reduced or removed. So, the interest grows on the tax but if there is interest on the penalty you get relief on the interest and the penalty and in the Levy office, let me give you another example. We have a client who hasn’t filed in several years and the gentlemen is in the trucking business and unfortunately a lot of these records from back then are tough. So, imagine we have to go back to 2013, 14, 15 right. Even back to let’s say 2013. So, five years ago we got to track down, he’s gonna track down he’s gonna track down credit card statements. So, I was talking to him earlier this week and he’s saying he was on the phone with one of the credit cards, actually two of the credit card companies and some can get online some they have to mail to him. He’s been hours and hours on the phone trying to track these things down. And by the way this client has only been a client of ours for just over a month and the revenue officer gave us 30 days to get the taxes done. Not unreasonable but knowing that he would have to get us the raw data in a couple of weeks we would then need a couple of weeks to do the six years of tax returns that have to get done. If he doesn’t have the data for a couple of weeks because the credit card companies or the banks that he has to track down the bank statements for can’t get him that info. Now, what do you do right. That’s one issue. The second issue is paying for it. So, let’s just pick some round numbers here. So, the average cost of a Schedule C tax return, I’m going to pick a lowball number four-to-five hundred dollars depending upon what’s involved in it. So, he’s got let’s say six years at 500 dollars. That’s three thousand dollars he’s gonna come up with to prepare Schedule C tax returns which is, what I consider pretty reasonable price, for a complicated not sure that’s the best word for a time-consuming tax return. So, it’s complicated especially when all the records we’re trying to put together and they have to be done sooner than later. So where is this gentleman going to come up with three thousand dollars, by the way, where’s he going to also have the ability to be able to seek representation so that if there is a levy that can be released. If there is something going on, it can be released right. And how does he juggle all that. Well that’s always the million-dollar question with how a client can dig themselves out of a hole because typically they don’t have the financial wherewithal. It takes time. Forget about that for a second. Assuming they had the money. It’s still gonna take time to gather the records. It’s still going to take time for an accountant, a bookkeeper to go through all the books and perform all the necessary bookkeeping to get to the end result of a tax return. Greg, you had a gentleman that was a restaurant owner and this case actually just this week you were able to have them put in what’s called in-business uncollected stache. You know what I’m talking about right.
Greg Mahaffey: Yes.
Lawrence Levy: And the amount of effort and time that was spent on this file was just a tremendous amount of effort and time when the restaurants nor the individual had the financial wherewithal to barely afford a cup of coffee at the local Dunkin Donuts. It just was, he didn’t have the funds to do it. And this particular revenue officer put you through so many hoops, physically came into the office and had meetings and it was just it was the most time consuming file that I can remember in a long, long time. And the end result was exactly as you stated it was going to be, what’s called in business fifty-three. And Greg, as a former IRS employee, do you have any insight as to why that went on and on and on like that. I mean now it ended up exactly where you said it would end up at. But you know months and months and months, hours and hours and hours later, it ends up right where you say it’s going to end up.
Greg Mahaffey: The biggest reason that those are very very hard to get is because if a taxpayer doesn’t show an ability to pay the IRS is going to question then how are they going to stay current. As part of that process of procedure, you will have to show the IRS that you will never again owe any more payroll taxes. And that’s a very high bar to try to meet and that’s why you need a professional who knows what needs to be done. We need to make sure that this person is not going to fall off the wagon so to speak and start owing payroll taxes again. So, we usually hook up someone we say with the payroll company or we’ll take over the payroll or along those lines so we can be assured and the IRS can be assured that this will be the last time they need to see this taxpayer for at least the next two years. In business uncollectible is a closure. But it’s only a temporary closure because the case will be reviewed every two years and unless the taxpayer starts accruing taxes again. That is why these things are so difficult to get because the burden of proof is upon us and upon the taxpayer to show where whatever that caused them to owe taxes those. that situation has changed. It will not repeat and there is no way that they will ever owe taxes again. That’s why it’s so difficult.
Lawrence Levy: Right and unfortunately you have a lot of either revenue officers or clients that there’s this ongoing struggle between the data that you have to gather to actually be able to perform and there’s this back and forth struggle that occurs but we’re here to try and take the emotions out of it. To try and diffuse the situation. There’s so much that goes on in these files. And I was actually talking to Mindy earlier this week and as she gets more involved in the tax resolution world as a power of attorney, she’s seeing so much more that goes on behind the scenes. The struggle to get the clients to give us the data, the struggle to get the client to be able to afford for the tax preparation by their accountants whomever it may be. And then there’s so much that goes on and then sometimes there’s so much time that’s spent in just going back and forth with unreasonable deadlines, with unreasonable request that just make no sense. So oftentimes you’re really forced into these pickles that become very time consuming to navigate through. But that’s what we do here in the Levy office. We have tremendous amount of power of attorneys. We have, not amount I should say we have tremendous power attorneys, and they’re great. We have Claire, we have Greg, we have Mindy. We have Bianca. We have Arnold. We have Rene. Just a great group of power of attorneys that are out there helping you navigate through this. And then the accountants. Mark and Dan and Dave Crop the CPA. You have then tremendous staff of the bookkeepers that help if there’s bookkeeping needs to be done. The Levy office is a one stop shop unlike other firms that are going to say, hey we only deal with this tax resolution side. You got to go elsewhere to get it all done for delinquent tax returns. We like to handle it because a) we want to have that interaction and b) we want to help you in the future. Greg you always talk about correcting the problem and making sure it doesn’t happen in the future and that’s I think a big part of it.
Greg Mahaffey: Yes. Unlike other firms. We want our interactions with you to be permanent in nature. We don’t want you to be able to fall off the wagon again and get into future tax problems. We want to find out how you got into this problem. What needs to be done to fix the problem and what needs to be done to ensure it will never happen again. Fix it right the first time. There’s a show on HDTV which they always say do it right the first time. That is our philosophy here. We want to sit down with you, one on one, we make sure that once we get you out of the trouble you stay out of trouble going forward. So, we’ll get you a deal is a deal you can live with, a deal that will not cause you to default in the future. It is something realistic and whatever the solution is, make sure that you don’t need to call us again.
Lawrence Levy: That’s right. We want to keep you out of harm’s way and we always say that you want to try and fix the problem going forward. You talked earlier about Greg embezzlement and fraud and theft. We had a client, a guy that I knew, just hired us a couple of months ago a guy knew literally from college. Doctor, his office manager embezzled, and she’s actually being prosecuted and there’s some sentencing coming up. And it happens that’s out there. And you know that the different stories that we’ve talked about that doctor just now we’ve talked about the doctor earlier with the wage levy that you got released. Lawyers, we have a client, Greg you’re working with a lawyer that owes over a half million dollars right now. Went through a bad divorce. Couple of kids just his life you know went into turmoil and you’re trying to do the best you can do to try and close that file out as currently not collectible. And the IRS is out there to do a job. You want to pay your taxes. You should be filing your taxes and you should be making sure that you pay on time and file on time. But if you don’t, that’s where we come in. If you can’t you don’t. You got scared. You forgot about it. The dog ate the car keys, whatever the reasons may be. We deal with it in a civil arena in a civil tax world. In our resolution world we don’t deal in the criminal side of it. And what’s called a CI. case, criminal investigation we deal on the civil side of it. But if you haven’t filed in a few years, if you owe the IRS, give us a call the local number is (561) 865-7800 or toll free (800) TAX-LEVY. And yes Levy really is my last name. And going through what happens in a file, it’s such an interesting discussion that I had I keep on going back to it but I had a long talk with Mindy and to tell her and to let her see what goes on the other side was a real enlightening. She’s a absolute sweetheart and she’s incredibly professional and incredibly knowledgeable and she really knows a lot because she was at the IRS. I think Greg as long as you were right.
Greg Mahaffey: Probably, I didn’t know her from the beginning, but she was there for quite some time.
Lawrence Levy: Yeah, I think over 30 years Mindy was. But you know the amount of experience the Levy office has. Just between Claire and Mindy and Greg. You add those up there at least over 30 years each. You know you’re talking. Uh you know a lot of years. I think it’s thirty-two or thirty-three years each talking almost one hundred years of combined experience from the IRS. Not to mention the power of attorneys in our office. Arnold’s been in the tax resolution business for I think over 10 years. And Danielle I think it’s almost six or seven years. So, there’s a lot of experience that’s brought to the table and we really encourage anyone who’s got an IRS issue to reach out and call us (561) 865-7800 or toll free (800) TAX-LEVY. And I want to end with saying that it makes us feel so good to be able to help people. The texts, the nice things that we get. It’s incredible. I want to read a text because it really made my day. If I can find it here, let me see if I can find it. “I appreciate what you’ve done for me as a professional”. That text was at 7:29 a.m. this past Wednesday, really makes you feel great about it. Then I’m going to read you another one that I can find it here. Uh “thank you so much. You’re a good person”. That was Wednesday as well at 12:29p.m. It makes you feel good. Greg, how many times have clients called you and said thank you. It just it makes you feel good to be able to help on whether it’s an offer in compromise or whether it’s a penalty abatement. Don’t you go home to your wife and your loved ones and say how great you feel that you can help someone just this week. On Tuesday night when you stayed at the office till almost 7 o’clock at night to help the doctor out to get the wage levy released. Doesn’t that make you feel great that you were able to get that release for that guy.
Greg Mahaffey: Oh yeah and there is an other doctor I got, well he was sitting in the office, got over forty five thousand dollars worth of penalties abated while he was listening in on the phone call. He was absolutely thrilled. Well that’s the only time I’ve ever gotten a massive bear hug from a doctor.
Lawrence Levy: Well, well there you go. But listen, no matter what the problem is, if you deal with it face on it’s resolvable, you’ll sleep a lot better. Gentlemen that was right here in the Delray office this week. Nice guy came in midweek and he just said his wife literally gets into tears over the IRS that which was about forty-eight thousand dollars and we said “Tell her not to cry, tell her to call us. It’s not going to be a magic wand that’s gonna make it go away. But if she wants to talk to us please have her call. We’re happy to talk about it and we’re happy to put her mind at ease” and he just said it’s the first night he can go home basically feel good and sleep good at night. If you have an IRS problem, you give us a call immediately. Right now. Top of the hour here. 9:00 if you are listening to this on Saturday then it re airs on the sister station on the hurricane station. Dan our sports guy, but it repairs on Sunday. If you have an IRS issue and you haven’t slept at night, you’re sweating at night. You have a levy, a threat of a levy, intent to levy or a final notice intent to levy, you give us a call at 800 TAX-LEVY. Yes. Levy really is my last name. (561) 865-7800. is the local number right here in Delray Beach. We are on Federal Highway about a half a mile south of Linton on the east side of the street. Give us a call if you can’t sleep at night because the IRS is keeping you awake and you’re tossing and turning. Greg thanks for all you do and a big shout out to the Levy team members. Love my staff, everyone enjoy the rest of weekend South Florida. And by the way be safe on Trick-or-treat day, October 31st, next Wednesday. Coming up right after that, you go right into the boat show. Enjoy the rest of the weekend South Florida. You take care.