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 several 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 enjoying what I guess we will call the besides being taxes and the spring break season. But what do we have coming up very quickly next week. There’s a pretty important deadline for corporate tax returns. March 15th is a important deadline for filing corporate tax returns. Coming up next Friday and also shortly we’re going to have coming up on us before you know it. The famous April 15th deadline, this show is about what you do if you have an IRS tax problem. What do you do if you’re in the middle or got a love letter from the IRS saying you are getting audited? What do you do if you haven’t filed your tax returns in a handful of years? What do you do if you owe back taxes? What do you do if you are a business owner and you got yourself into some financial trouble and you haven’t paid your payroll taxes? This show is about all of the above. We deal in civil tax controversy. We are local and we are by far the best and the most experienced team in the country. The Levy office is on Federal Highway about a half a mile south of Linton on the east side of the street. The local phone number because I don’t give it out enough. It’s (561) 865-7800 and toll free 800 TAX-LEVY. Yes, Levy really is my last name. Before we get into some of the dealings of the week and peaks that we’ve had and the successes that we’ve had I want to also say good morning and hello to a gentleman that used to work at the IRS for many years and has now been on the Levy team for a long time. Good morning Greg.
Greg Mahaffey: Morning Lawrence. How’s everything going down there in sunny Florida land.
Lawrence Levy: It’s Always Sunny. No matter what. It’s always sunny in the levy office when clients come in they have sometimes tremendous stress. And we do our best to try and alleviate that stress. We don’t have that magic wand but I can tell you that we certainly try and we care. Greg can you give everyone a little bit of the background. I know you worked with the IRS over 32 years and you were a revenue officer so you were that guy that would knock on the door of a tax payer that had a tax problem. You also worked a little bit in the offer in compromise unit and you also had some specialty we’ll call it duties if you will, APAC and so forth which is a more technical specialized unit for some of the more troubled children as we may say that occasionally right. But Greg now working in the private sector, doesn’t it make you feel good to help a client who genuinely has the need. In particular I want to start off today’s show by talking about a doctor. Client. Nice guy. Sad story. He’s got some severe medical issues. And Greg this has been going on for about a year if not longer. Can you give everyone a little bit of the background regarding the doctor that you just wrapped up this file.
Greg Mahaffey: Yes, basically He’s an ObGyn. He’s been in practice for many, many decades. How ever the doctor has become ill himself with kidney failure and he has to go to dialysis three or four times a week. He’s been on a waiting list for a kidney transplant for the past two years and if he doesn’t get one within the next 12 months it may be all there is for him. His income has dropped dramatically over the past couple of years as well as his health has steadily declined. So, what we managed to do with the IRS with his significant debt was to get them to place the account in what’s called currently not collectible status. It’s not forgive what he owes. It’s simply places that in abeyance until his income and his health improves to the point where he can start paying against the back taxes. In other words he has no equity assets. He has no ability to make monthly payments and the IRS actually recognizes that it suspends active collection on his accounts.
Lawrence Levy: So, let me just time out for one second there. Greg, when you’re dealing with someone and a client of ours and this isn’t the first time sadly and it sadly won’t be the last time where a client has a severe medical condition. Whether in this case it’s kidney failure, whether it’s a heart attack, whether it’s cancer or sometimes you have other medical conditions that impact your life. It’s frustrating because what should be a phone call, a couple of faxes, a couple of documents and a resolution to me seems so practical and seems so reasonable that you explain and we’ll talk about this gentleman situation. Here’s the letter from the nephrologist. He’s got kidney failure, right. Here’s his latest bank statement. You see a decline in the revenue. He could barely work at all. And he’s trying to just survive. Why is something like this. Why does it take literally months and months and months and months for the IRS to recognize that this gentleman has no ability to pay. And I picked this up because a lot of clients seem to think it to me. I got to tell you I’ve been in the business over 20 some years. To me, it seems that it should be a explanation, of course, with supporting documentation. They’re just not going to take your word, as the power of attorney Greg. But as a former revenue officer, why does it takes a long. It’s so frustrating not only is it frustrating for us, it’s frustrating for our clients and as opposed to the IRS taking a practical approach in a timely manner. These things just get dragged out and dragged out and it just it doesn’t make any sense to me. Any insight you can share on that so that the listeners and the public can understand right from the mouth of a former 32-year veteran revenue officer that retired a few years ago. I mean, why can’t it just be a simple explanation and then case closed and put in what they call see CNC and see what happens. Like you folks anyway. Instead it drags out any thoughts. Former Revenue Officer Greg Mahaffey.
Greg Mahaffey: Well an experienced revenue officers heard many many stories over the decades dealing with the public. Some are more truthful than others, some are more accurate than others, some have been embellished to some degree. Some have our sometimes even outright lies. That’s why a revenue officer when they hear stories they’re supposed to be sympathetic but at the same time they’re charged with protecting the government’s interests. No one can say I’m dying of cancer. However if you see a healthy 32 year old who goes to the gym eight times a week and multiple times a day running a luxury car, living a luxurious lifestyle and yet claiming Oh I’m dying I can’t be collected upon right now. You’re going to want to see the proof.
Lawrence Levy: That’s fair. And I agree with you by the way. And I’m quite sure that revenue officers are given a song and a dance many times. And I want to explain these things because you’re right. And as a former revenue officer I’m sure over your 30 some years at the IRS you were given nonsense and I’ll call it that whether I don’t want to say just bluntly lied to but you were given some runaround and some nonsense, I’m quite sure over the years. We try and explain as best as we humanly possibly can to our clients, what is needed, what the IRS will accept, what they won’t accept and literally almost seven days a week. And sometimes it is seven days a week. There are situations in which we have to explain the rules the guidelines the limitations that the IRS has in the rule book and the rule book is called the IRM, the Internal Revenue manual. And Greg as a revenue officer there is some discretion granted. As a former revenue officer I should say, there is some discretion in the interpretation of the rulebook. And I believe what’s frustrating as well is what one revenue officer may do. Another revenue officer with the exact same file, the exact same facts, the exact same circumstances may do something different. And Greg you talked that up to you chalk it up to personality, and you talk you chalk that up to just maybe a group manager’s directive. So the marching orders are different from this GM compared to that GM. That’s where also it’s frustrating because it’s very difficult. I’ll give you an example. And Greg maybe we can talk about this. A client says by the way that they owe a lot of money, it’s literally a million dollars. He says I have a life insurance policy on his kids, on him, and on his wife. And what should he do. She did actually not pay him and he’s healthy and it’s a I believe the term palace no I’m sorry. I think that actually whole life policies really do accumulate some cash value. He’s on the phone asking one of the POA’s in my office. What should he do. Should apparently not pay it. Right. And he’s worried that he’s stressed out over his million dollars. And if he dies what’ going to happen to his family. So how do you answer that right. As a as a father I have two boys. I have a wife. Greg you’re married you have kids, you have grand kids. How do you answer that question to a client saying “What do you do?”. Do you pay the IRS or do you keep your life insurance policies in place for your family. That’s an example of a very difficult discussion that we have on a frequent basis. Any thoughts on that one. Greg as a former revenue officer as a father.
Greg Mahaffey: Well the first thing the IRS does not allow for payments on whole life policies. They allow for term life policies. Now, that’s a new ruling that’s come down from higher level management at the IRS. If you have a reasonable amount for term life policies, they will allow that necessary living expense. I consider whole life policies or Universal life policies to be and investments and as such they’re not going to allow you to make additional investments into that account to gather wealth when you owe back taxes. Same thing with for 401k distributions unless that’s a mandatory, addition to your for one k if you work for a business and your business has a 401k plan and you authorize so much out of a paycheck to go to that 401k and you owe the IRS, the IRS is when you say no. That is an investment it’s a long-term investment but it’s still an investment. You must prioritize your back taxes before you make any additional investments into your retirement plan, unless it’s mandated by your employer and you’ll have to hire a firm that knows the ins and outs and knows the rules. Who can argue on your behalf getting a lot of times the IRS revenue officers because they are individuals. Some are hardcore. Some will reach out to help people. Hardcore ones will say no, you must pay us. We don’t care what your situation is. And that’s why you need a firm like ours who will protect your rights, who know what you need to live on. Who knows the proper solution for a case and can work with them if necessary. Appeal your situation further above that level of that revenue officer to his group manager, to his territory manager, to the area director involving the other such management teams as necessary. The advocates offices is frequently another tool that we use here to help protect our clients against overaggressive or consider-to-be an unfair situation.
Lawrence Levy: And that’s what let me just interrupt there. That’s what also a lot of people don’t recognize that there are solutions that exist out there. And let’s be really frank on this one. IRS employees they have a job to do. However, they should go about it as should we, in a professional polite courteous respectful manner which we hope would be with a resolution oriented case approach, so that you focus on a resolution as opposed to being the epitome of a roadblock. And it’s frustrating because we have clients who come to us when they tried to work things out with the revenue officer themselves. And quite frankly, the lack of response from the IRS is oftentimes a very big driving force to drive clients to a tax resolution firm. It shouldn’t be. It is. So for us of course we don’t mind that, it’s business. But the frustrations that we encounter because a revenue officer doesn’t respond. They don’t return phone calls timely. Greg, I know when you worked at the IRS used to work oftentimes on Saturdays almost every almost every Saturday. A lot of revenue officers do not in fact you don’t know many that do work on weekends but we are, we’re open seven days a week. You’re in the office actually literally every Saturday and then we have one of the POA’s in the office typically for some hours on Sunday as well. So we’re a seven day week office. By the way, Let’s give out that phone number again. I don’t give it out enough, the phone number is about halfway through today’s show is 800 TAX-LEVY Yes. Levy really is my last name. The local phone number (561) 865 7800. And give us a call if you have an IRS issue and the IRS has been sending you letters. By the way the IRS loves the mail and I want everyone to really listen to this. The IRS does not use my last name out of the gate. It is weeks and months and months and months down the road until the IRS will eventually fire off my last name, a levy. A bank levy, a wage levy, or if you’re a business, A levy on receivables. And this week I want to tell you we had a client that owes a lot. I think it’s nine hundred thousand dollars. Greg is not one of your files and the revenue officer. I will tell you it’s probably one of the nicest most reasonable. She’s tough though but most reasonable revenue officers that we’ve known in many many years. And she had assured the POA (Power of Attorney) in my office that no levees were going to be issued. Somehow or another there was a glitch and levees got issued and she was incredibly honorable. She said I’m sorry I don’t know what happened. Technical issues. And she said give me all of the levee sources and I’m going to issue releases. And when I mean the most honorable nicest of them all. This lady is absolutely incredible. So, the IRS does have staff that work there that are reasonable, that are practical, that do take the case approach. Hopefully that’s going to take it down the path of a resolution as opposed to a hurdle an obstacle and roadblock and logjam and all those other words that are in that same set if you will. It does happen for the client obviously needs to understand why this happened and we of course have to explain that. Whether they buy it or not we’re telling them what happened. The good news is it’s going to get released. And it did by the airing of this show. But things happen and the client obviously forever thankful because had we not been there he may not have known what to do or what to say. And it was a timing issue for him when he and his wife hired us, by were very nice people and they just got themselves into a jam and when we ask the question which we do. What caused you to get into this problem. And as Greg was mentioning earlier. Sometimes it’s medical related oftentimes it’s just the clients were scared. They knew that they would owe, they knew that whatever their life path took them down that they got themselves behind the eight ball and into a financial pickle and IRS is a bill. And whether you get behind in your mortgage, whether you get behind on your car payment, whether you get behind it don’t pay your cell phone bill, whether you don’t pay your taxes. Those are all bills and we deal in civil tax controversy, we do not deal in any of the criminal investigation side of the IRS. So if you have a tax problem as Greg mentioned earlier we have an incredible bench and I’m not a sports guy but it sounds good. Our bench, our team consists of former IRS Revenue Officers. Greg you worked there for thirty two and a half years you always say right.
Greg Mahaffey: Yes, because every month seems like a year there but I was there thirty two and a half years mostly as a revenue officer. But like you indicated at the beginning the show three years now was an offer specialist. Three years I was an employment tax specialist. So if you have issues out there regarding independent contractors versus employees, we’re the experts. We can answer those questions for a while for three years I was what’s called APAC or CPAC or specialty team member dealing with the people who would launder money overseas and so forth are really complex cases of border upon the criminal elements. And during that time I was also in this espoused special for six month detail not to mention many details as acting manager during my career. So, I have been there, seen it done it and have quite a bit under my belt so to speak and I use those experiences to help all of our clients. If you have a question over a lean release if you want to remortgage your house but there’s federal tax liens. How do you overcome the federal tax rulings, you apply for a subordination. You apply for discharge. Were the experts out there. You can grope around in the dark all you want but you really need to come to the experts who know what they’re doing will get you the best quickest resolution possible in your particular situation.
Lawrence Levy: Greg what about it back to you Lawrence to it back to you. Yeah.
Greg Mahaffey: Back to you Lawrence of course.
Lawrence Levy: So. Let me also talk about something that happened this week and I’m trying to find a day I believe it was on Wednesday. One of the POA’s that in our office made a call to the IRS. Our client owes roughly three hundred fourteen thousand dollars. A new client which dates back literally over over 10 years and the IRS was able our POA Daniel was able to get penalties abated of over four thousand four hundred dollars for one of the periods. Now three hundred and some thousand dollars, four thousand isn’t a lot but at least it’s a start. And without knowing what to do, what to say, how to approach these files. A lot of times people don’t know that tax resolution exists. It’s actually a very much needed part of life. When someone gets themselves into a tax problem. Then this client ends up owing a lot of money. I don’t know the reason behind it at all. I’m not familiar with this file but I can tell you that when you pick up the phone and someone in my office calls and says You’re not going to believe this but I’ve got penalty abated the client is beyond thrilled. Oftentimes they get emotional. They cry and I want to explain that it is really important that you hire representation to deal with an IRS civil tax matter certainly criminal, you need one, But in the civil world I believe that it is a really important piece of the IRS maze because there are a lot of options that you have that people simply don’t know about. One of the classic stories we like to tell and Greg you happen to know this revenue officer from when you worked at the IRS but we had a client that before coming to us was using a power of attorney, an attorney who happened to be more of a bankruptcy attorney than anything and playing IRS tax resolution specialist and in a meeting where it was at this attorney’s office that then client our now client and the IRS revenue officer were there and she was asking the client what would you think you can pay. And without doing any math the client didn’t know what to say and threw out a number because he was pressured. He said five thousand dollars a month. Now there was no arithmetic behind it whether it was high school calculus or whether it was seventh grade math. It was at the number that he tossed out because he felt pressured as he told us when he was in a conference room with this aggressive postured revenue officer. So then he looked back on it and he’s thinking Jesus what did I do. What did I say. And the power of attorney at the time his POA said absolutely nothing. So he says and gave no feedback. The end result of that story. And Greg you were involved in a piece of this was that the business ended up getting put into a $700, I think a 750 dollar a month installment agreement which is a far cry from the five thousand dollars that this revenue officer was pushing for and was pushing because of clients that they could do it. Did it say to the client Hey how about filling out a financial to see what you really can afford. This is towards the business. The same revenue officer Greg, pursued trust fund against this gentleman when his father was actually at the helm and now had now has some medical issues and you ended up having to step in, you tag team the file with Daniele and you ended up going to appeals and after speaking to a very well versed smart fair rational professional appeals officer, the IRS sided with what your position was Greg and that should make you feel good and you were actually preparing for that literally until about nine o’clock at night the night before. And how does that make you feel knowing that you were able to help this gentleman out. Help his family out give him the peace of mind but also how does it make you feel that the IRS apparently didn’t do enough homework. It just took a shot. What appears to be in the dark and that’s the way the client sees it, by not doing their due diligence to determine if this person should be liable or not. How does that make you feel.
Greg Mahaffey: Yeah,. Basically at times you get angry. Other times you have to step back and look at it. These people are burnt out. They’re stressed at the IRS. They need to get a job done. They’re under pressure from their management. What they may think is the right thing may not be the right thing according to their manager pressuring them to provide production to close cases, to get cases resolved according to what they see is the right thing to do. And so when we have to step in there a lot of times we have to step back and look at it from outside third party perspective and we convince the IRS. Hey guys here’s the reality of the situation. The most that could be paid, if you force me to in an agreement that they won’t be able to keep going and not making current deposits and they’re going to do more taxes. And this problem will mushroom, grow bigger and bigger and bigger. So a lot of times with the partnership with the IRS they’re willing to partnership with us to find an appropriate solution. That’s the ideal way the IRS should be working their cases. This is the way we were trained only 20 years ago. Look at things from the tax payers perspective. But you have to protect the government’s interests at the same time. Is the taxpayer pyramid thing as they call it, Trust fund taxes. This is Second so quarter after quarter after quarter. First question why?What is wrong, what’s causing this to happen.
Lawrence Levy: And is also out right and also what’s going to fix that problem as we come to the top of the hour that we wrap up. It happened actually this week literally on Wednesday mornings. Now I take that back Tuesday afternoon I was speaking to a client who hired us just before Christmas and we are very clear. And Greg you can back us up on this one even when you were at the IRS and you worked with our firm on the other side as a revenue officer. We say the client from this day forward you must stay current whether you’re self-employed and you have to make your quarterly estimates whether you’re a business owner and you have to file and pay your payroll taxes. We say from this day forward you must stay current. And if not your resolution options are slim to nonexistent because IRS will consider you not in compliance. And as Greg mentioned the word an in business pyramiding taxpayer. You’re just accruing more liability than enough to incur it. So the guy hires us. Nice guy. Another situation where this gentleman’s father ended up passing away. He basically took over the business after the father passed and he didn’t stay current ever since before Christmas. So here we are now on January of February nowadays and march and we had to have that real heart to heart talk with him that his noncompliance is going to be a major hurdle in us getting a resolution for him. And again we have to articulate these things to our clients to say that they must understand the importance of staying current. If you have an IRS issue you need the help. Make this the call to action. We want you to come into the office. If you’re listening to the show and you’re local we’re right on Federal Highway about a half a mile south of Linton on the east side of the street. By the way, I want to end to the past and the next 20 seconds or so. We also had a client this week that said that they were dealing with the Florida Department of Revenue and the rep said you must pay one hundred and thirty thousand dollars or else as opposed to saying well hey you have options such as what’s called a step agreement which is a fancy term for payment plan. So if you have an issue whether it’s Florida Department of Revenue whether it’s the IRS, you should pick up the phone and call us. Let’s at least let you talk to someone in our office that can give you some guidance. Come on in. We have a great team, the former IRS Revenue Officers Greg and Claire. Claire worked at the IRS for over 30 years as well. Tremendous experience. Danielle, Bianca, Arnold you really really needs to get representation if you have an IRS issue no matter what it is, solutions do exist. Give us a call toll free 800 TAX-LEVY. And by the way Greg let’s end for say by saying thank you very much for your service to the country you are in the Navy the Gulf War. Not only do we thank you for what you do for the Levy clients and as a part of the Levy team but thank you for your service to the country. On that note everyone enjoy the good weather that Florida is having. Enjoy for the spring breakers. Yep can be tough to get a dinner reservation and you can be a little bit more crowded but that season for you and spring break season for you. But we are in tax season is in full effect. If you have an IRS problem you can call, we are local and we are the best and always remember, you want to levy on your side not one against you, and don’t fear a levy. You hire a levy. Signing off from the Levy Tax Help Show so enjoy the rest of the weekend South Florida. You take care. We’ll speak to you next week.