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Is Working with the IRS Your Only Option?

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

  • Taxpayers have the option to work with the IRS directly or hire a tax professional to help resolve their tax situation.
  • Working directly with the IRS to settle tax debt could prove to be extremely time intensive. 
  • A tax professional will work with the IRS on your behalf to get you compliant and to negotiate the best possible outcome for you.

If you just found out you owe a tax liability or you’ve known for some time that you’ve had an outstanding balance with the IRS and you have no idea how you’re going to pay them back, don’t freak out. There
are options the IRS provides for taxpayers to get compliant as well as tax professionals who can walk you through every step of how to get you on the right track with your tax debt. 

Should you choose to work directly with the IRS, they will require that you have filed all your taxes, including the current tax year. If you have some tax years that have yet to be filed, you may have to either file your own taxes or go to a tax preparer to file for you. Once this is complete, the IRS will request proof of your most recent income to review what payment agreement you qualify for. The IRS will then present you with options you have for a monthly payment plan. Although the IRS will review some of your expenses and consider them as a factor when deciding how high your payment plan should be, the process to see if you can get it reduced can be extensive and time-consuming.

If you decide to go with a tax firm, they will negotiate on your behalf so you don’t have to deal with the IRS. If you have unfiled tax years that need to be filed, a tax firm will typically assist you with all your unfiled years and make sure that you’re up to date with all your taxes. Once your returns are filed and your financials have been reviewed, a tax professional will usually go over payment plan options you may qualify for and explain to you why you qualify for those options. After your options have been discussed with you, a tax professional will begin negotiations with an IRS agent and will attempt to get you the best possible outcome.

If you have a tax balance that you’re looking to settle with the IRS, weigh your options. Research whether it is more feasible to negotiate with the IRS directly or to have a tax professional assist you throughout the process. Whichever you decide to go with, it will still be beneficial to you since both will get you out of collections and compliant with
the IRS.

If you need tax help, contact us for a free consultation.

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Avoid any Tax-Time Surprises by Following these Simple Rules

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

  • Taxpayers could potentially qualify for credits on their tax return that could either lower their tax balance or produce a larger tax refund. 
  • The IRS recommends that taxpayers check their withholdings throughout the year to ensure they are on the right track.
  • If you’re a 1099 earner or you’re not withholding enough from your paychecks, you will most likely need to make estimated tax payments throughout the year.

Tax filing season is upon us which means there may be some surprises you encounter along the way that may or may not be unpleasant. So what can you do to avoid being caught off guard when filing your taxes? 

Below are a few ways to prepare to get the most out of filing your tax return:

Understand what you qualify for. There are a vast amount of tax credits that you could potentially qualify for. The IRS isn’t going to tell you what you’re allowed to place on your tax return, so it is up to you as a taxpayer to do your own research or inquire with a tax professional to see if the type of expenses you have incurred can possibly go on your return. A few types of credits that you may qualify could be the following:

  1. Lifetime learning credit– this is to help offset the costs of post-secondary education; eligible students could earn up to $2,000. The credit is available to those who make $58,000 or less, or for married couples earning $116,000 or less. 
  2. Child and dependent care credit – this is to help offset the cost of babysitting and daycare. This is available to taxpayers who have children under the age of 13.
  3. Savers tax credit – Those who qualify have made eligible contributions to retirement plans such as a 401K. Taxpayers with the least income will qualify for a larger credit – up to $1,000 for those filing as single, or $2,000 for those filing jointly.

Do a withholding checkup. The IRS recommends that taxpayers check their withholdings throughout the year to ensure they are on the right track to receive a refund and to avoid owing at the end of the year. If your income has increased during the year, it is advised that you do a checkup to ensure that you are withholding enough or if more needs to be taken out of your paycheck. 

Make estimated tax payments. If you’re a 1099 earner or you’re not withholding enough from your paychecks, you will most likely need to make estimated tax payments throughout the year to ensure you don’t owe a tax liability come next filing season. The IRS allows taxpayers to make their payments via ground mail or online. Taxpayers are required to make their payments quarterly or monthly to ensure they do not receive a penalty when they file their taxes. If you need assistance calculating your estimated tax payments, the IRS encourages you to use their withholding estimator to see how much you should be making in payments. 

If you need tax help, contact us for a free consultation.

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Companies Giving Back During the Coronavirus Pandemic

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

During these difficult times, we as Americans
are attempting to do our part by staying indoors and minimizing contact with
the outside world. Although it seems that there may be no end in sight as virus
numbers continue to increase,  some companies
have noticed that many Americans have been struggling to cope and have decided
to give back in any way they can.

These are just some of the many ways that businesses have been giving back to their employees and communities:

  1. Starbucks has extended its mental health benefits by offering confidential mental health care, 20 free in-person or video sessions for therapists and coaches. 
  • LinkedIn is providing 16 free courses that provide tips on staying
    productive, building relationships, how to use virtual meeting tools, and many
    other courses. 
  • Mark Cuban announced that all his employees will be reimbursed for any lunch and coffee purchases from local and independent small businesses.
  • Adobe is providing higher education and K-12 institutional customers
    their Creative Cloud apps which have the ability to request temporary at-home
    access for both students and educators. 
  • Salesforce has created a $1.5 million dollar coronavirus fund for San
    Francisco citizens that have been affected. 
  • Shake Shack returned their $10 million federal loan they received from the Paycheck Protection Program so it could go to other small businesses that are currently struggling and have yet to receive financial assistance.

If you need tax help, contact us for a free consultation.


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Avoid Scammers Getting Their Hands on Your Stimulus Check

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

With millions of Americans currently losing their jobs and income during these difficult times, receiving a stimulus check is necessary for many Americans to stay afloat. The IRS has already begun to distribute stimulus checks for up to $1,200 to individuals. Although the thought of receiving money can seem like a good thing, it can also mean that there are thieves looking to take your check before you can even receive it.

Here are a few ways to avoid becoming a victim of fraud:

  1. The IRS will never contact you. Scammers may try to contact you claiming that they are an IRS agent and they need further personal information in order to process your check. This tactic is called “spoofing” and taxpayers can expect an increase in receiving these types of fraudulent phone calls as stimulus checks are being distributed. 
  2. Avoid clicking on emails claiming to be from the IRS.  Another tactic that you may come across are emails that appear to be from the IRS requesting that you provide your social security number or banking information. Be wary of these emails and avoid clicking on any associated link that is attached to the email as it could lead to a virus on your computer and whatever personal information stored on your computer could be stolen.
  3. If you don’t have direct deposit, you’ll never need someone to assist you with setting it up. The IRS will be sending money to households via direct deposit, using the banking information that you placed on your tax return. 

If you don’t have direct deposit, the IRS provides you with two options. You can submit your banking information to the IRS portal or you can choose to receive a paper check. If someone attempts to contact you claiming that they’re going to assist you with receiving your stimulus check much quicker, avoid providing any personal information to this person. The IRS will never attempt to contact you about your stimulus check and provides tools on their website for taxpayers to fill out themselves.

If you need tax help, contact us for a free consultation.

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You Could be Receiving a Monthly $2,000 Check and Canceled Rent or Mortgage Payments for 1 Year

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

Stimulus Check:

Lawmakers are proposing a new economic plan to assist taxpayers during this ongoing crisis. The Emergency Money for the People Act would give Americans a $2,000 check every month for a year.  Those receiving the check must be 16 years and over and earn less than $130,000 and would continue until unemployment levels drop back down. 

Individuals who were left out of the initial act would be included, such as some high school students, college students and adults with disabilities who were previously ineligible to receive the prior stimulus check because they were claimed as a dependent on another tax return.

Additional eligibility requires:

  • Married couples earning less than $260,000 would receive $4,000 a month.
  • Qualifying families with children would receive $500 for up to 3 children.
  • Those who had no earnings, were unemployed, or currently unemployed will qualify for a stimulus check.
  • Taxpayers must have their 2019 or 2018 tax returns filed in order to receive their check. 

Canceled Rent/Mortgage Payments:

In addition to the stimulus check proposal, lawmakers also want to introduce an act that would help struggling Americans that are currently unable to pay their rent or mortgage due to the coronavirus. The Rent and Mortgage Cancellation Act, if approved, would call for a nationwide cancellation of mortgage and rent payments through the duration of the coronavirus pandemic, or up to one year. 

The bill would additionally include:

  • Rent or mortgage forgiveness for the primary resident.
  • No negative impacts on your credit score.
  • A relief fund would be established for landlords and mortgage holders.
  • No accumulation of debt for renters or homeowners.

We will continue to update you with new information as this story develops. 

If you need tax help, contact us for a free consultation.

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What You Need to Know About the Economic Relief Small Business Loan

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

  • New negotiations on Capitol Hill have been ongoing in an attempt to assist the small businesses that have yet to receive relief.
  • Early discussions included allocating more money for hospitals and state governments during this time of crisis.
  • $60 billion in loans and grants would go to a small business lending program.

More than 22 million people have lost their jobs within the last month and many businesses are struggling to stay open as the economy continues to get closer to an impending recession. Discussions have been surrounding a new small business loan on Capitol Hill that is expected to assist small businesses that have been affected by the economic fallout from the coronavirus. 

Last Thursday, the $349 billion emergency small business lending loan program ran dry and now new negotiations on Capitol Hill have been ongoing in an attempt to assist the small businesses that have yet to receive relief. 

Treasury Secretary Steven Mnuchin and Democrats are attempting to reach an agreement for a package that will immediately increase funding for the program to assist additional businesses. Early discussions included allocating more money for hospitals and state governments
during this time of crisis with $75 million being directed to hospitals and $25 billion for testing. 

The package continues to be finalized, lawmakers are discussing an increase of $310 billion for the Paycheck Protection Program, with $60 billion being reserved for smaller financial institutions to distribute while the other half would be for provisioned lenders with less than $10 billion in assets and for institutions and with assets between $10 billion and $50 billion. An additional $60 billion in loans and grants would go to a separate small business lending program.

We will continue to update you with new information as this story develops. 

If you need tax help, contact us for a free consultation.

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When will You Receive your Stimulus Check?

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

As of this week, the IRS has started to send out stimulus checks to taxpayers. An estimated 80 million people received the payment deposited into their bank accounts this Wednesday, others will be waiting longer to receive their money.

When should I expect to receive my payment?

The initial round of payments went to those who filed their 2018 and 2019 tax returns who requested directed deposits for their tax refunds. Those who had the lowest amount of income were distributed their checks first. In addition to this, Social Security recipients will automatically receive their tax payment even if they have not filed a tax return. 

For those who opted out of direct debit, the IRS will distribute checks, taxpayers could be waiting for weeks before they receive their money. If you have not been required to file a tax return for the past two years, the IRS will require you to submit some information before they send you a check. 

How do I check the status of my payment?

If you have yet to receive your stimulus check and want to find out further information on when you should expect it, the IRS
created an online tool called Get My Payment that allows taxpayers to check on the status of their money. 

In order to track the status of your money, the IRS will require that you enter your Social Security number, date of birth, and mailing address. For those that attempted to use this tool on Wednesday, the Treasury Department recommends checking again since the tool updates once daily. 

If you need tax help, contact us for a free consultation.

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Tax Withholding: How to get it Right

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

As a W2 earner, you have the option to change your withholdings on your paycheck to either earn more or less. As a taxpayer, it is important to understand the repercussions you could potentially face for you adjusting your withholding and how it could affect you when it comes time to file your taxes. 

Here is everything you need to know about withholding and what you need to be aware of:

Your withholding is determined by several factors:

  1. The amount of income that you have earned.
  2. Your filing status – either the single or married rate.
  3. Number of withholding allowances claimed. With each claim you add on, it reduces your withholding amount.
  4. Additional withholding – an employee can request through their employer to withhold an additional amount from their paycheck. 

How your withholding could affect you:

  1. Withholding too little on your paycheck could lead to you owing a tax balance.
  2. You could be withholding too much. If this is the case, you will receive a refund once you file your tax return.
  3. Your income increased but your withholding stayed the same. You could potentially owe come tax time, make sure to see if your income bracket has changed and consult with a tax professional to see what you can do to avoid owing money or having your refund reduced when you file your taxes.

What you can do to avoid running into tax trouble:

  1. Use a tax withholding estimator to check if you are withholding the most accurate amount. The IRS provides a calculator for taxpayers to use.
  2. Consult with a tax professional to discuss what your withholding options are and what you can do moving forward to ensure you won’t run into any issues come tax time.

If you need tax help, contact us for a free consultation.

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You Received an IRS Notice, Now What?

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

  • The IRS will send a notice regarding the debt as well as the penalties and interest that have also accrued in addition to your balance.
  • Failing to provide all relevant information on your tax return could result in you receiving a certified letter from the IRS notifying you that information was missing.  

For those that have already filed their taxes, they may think that tax season no longer affects them but that may not necessarily be true. Some taxpayers may receive a certified letter in the mail from the IRS after filing their tax return notifying them of a balance due or that some information was missing on their tax return. If you’ve received a notice from the IRS, don’t panic, there are options available to you that the IRS offers.

You owe a tax balance.

If you’ve already filed your taxes and owed a tax balance that you have yet to pay off, the IRS will send a notice regarding the debt as well as the penalties and interest that have accrued in addition to your balance. For those taxpayers who are unable to pay their tax liability in full, the IRS offers installment payments that can be made over a period of time in order to satisfy your debt. The IRS will typically present you with a payment plan based on the income that was provided on your tax return. If your income has changed or you are unable to afford the payment plan that was presented to you, it is recommended that you consult with a tax professional to see what additional options you may have. 

Information is missing on your tax return. 

Failing to provide all relevant information on your tax return could result in you receiving a certified letter from the IRS notifying you that information was missing and they need further assistance from you in order to process your return. Typically this letter is sent to taxpayers who have failed to provide all forms of income on their return and will need to submit additional proof to avoid the IRS looking further into the situation. 

Identity theft has caused your tax return to be rejected.

The IRS will notify a taxpayer if they believe that there may be fraudulent activity occurring on their tax return. The IRS will send a letter to you inquiring about a suspicious tax return that you may have not filed. The IRS will request that you do not e-file your return because of the duplicate social security number that was used. Act quickly should you receive this letter from the IRS to avoid further fraudulent activity with your personal information. 

If you need tax help, contact us for a free consultation.

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Why You Should Review Your Tax Return Before Signing Off

Optima Tax Relief provides assistance to individuals struggling with unmanageable IRS tax burdens. To assess your tax situation and determine if you qualify for tax relief, contact us for a free consultation.

  • When reviewing your tax return, double-check that all income you received has been properly reported.
  • Ensure your name, social security number, and your accounting and routing number are accurate.
  • If your tax return is missing or contains inaccurate information after you signed off on it and it has already been filed, you may need to get it amended.

If you are getting ready to file your taxes, it is important to understand that as a taxpayer, you are fully liable for the information placed on your tax return once you sign off on the dotted line. Although you may have gone to a tax preparer to file on your behalf, it is still your responsibility to ensure that everything adds up correctly and that the information entered is accurate. Should you fail to do so, you could potentially face consequences with the IRS down the road. 

Here are a few ways to make sure that your tax return is accurate before sending it off to the IRS:

Double-check that all your information is on your tax return. Do not just sign off on a completed tax return, take the time to actually review the information that has been placed on it. If there is any information that is missing, especially your income, you could run into some issues with the IRS and it may also cost you more money. When reviewing your tax return, double-check that all income you received has been properly reported. You can double-check the amounts by reviewing your W2 or 1099 forms provided to you by your current or past employers. 

Look for incorrect information. Something else that you should check before signing off on your tax return is if your name, social security number, and your accounting and routing number are accurate. Ensuring that all your information is correct on your tax return will help you avoid any delays in your tax return and allow you to get your tax refund as quickly as possible.

Avoid having to have your tax return amended. If you realize your tax return is missing or contains inaccurate information after you signed off on it and it has already been filed, you may need to get it amended. In order to avoid raising any red flags with the IRS, make sure that you’ve provided all tax relevant information to your preparer so they can include it on your return. In the event that you fail to provide certain information to your tax preparer, you will need to request that the tax preparer amend your tax return to include the missing information. This will not only cost you more money but also your time.    

If you need tax help, contact us for a free consultation.

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