[NY] What should you do if the IRS threatens to revoke your driver’s license over unpaid taxes?

NY Tax

Jessica B

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Yes, your current financial situation can definitely play a role in negotiations with the IRS. If your income has decreased, this can be a factor in negotiating a lower payment plan or even an offer in compromise under (26 U.S. Code § 7122), which is a settlement for less than the full amount owed. It's important to provide documentation of your current financial situation to support your case. The IRS's own Offer in Compromise program guidelines outline the financial disclosure and eligibility requirements for this option.

Having a tax attorney review the work your CPA did before filing can be a good idea, especially if you have doubts about the accuracy of the figures or feel that your business expenses weren't properly accounted for.

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I want to consult with a tax attorney about IRS matters.

Lexi, Chatbot

I understand that dealing with IRS matters can be stressful. Can you please share if you are currently facing any specific issues with the IRS?

I recently received a notice stating that my New York driver's license was going to be revoked in 60 days. I have outstanding previous years' taxes due and currently have a CPA working on them, but they want me to sign documents to do a payment plan, and I don't feel that they are representing me correctly in terms of what I owe.

Lexi, Chatbot

Have you previously worked with a tax attorney or is this your first time seeking legal assistance for tax-related matters?

First time.

Lexi, Chatbot

Is there anything else the Lawyer should know before I connect you? Rest assured they'll be able to help with your IRS matters.

No.

Jessica B

Hey there! Welcome to our service. I'm Jessica, an attorney with many years of experience. I understand you're dealing with a situation involving a notice from the IRS about your New York Driver's License revocation due to outstanding taxes. Have you considered any legal actions to address this issue?

Are you a tax attorney? I am looking to figure out how to mitigate this.

Jessica B

Yes, have any returns been filed since receiving the notice?

The truth is I really don't know if taxes were filed. I know I have about seven years' worth, and now all of a sudden they wanted me to sign everything, and I told them no, this doesn't seem accurate to me, and they're saying the payment plan is going to be so much, like $5,000 a month, and that's not even possible for me, and I don't feel that they did it accurately representing my business expenses, and I don't know if I should sign with them and let them submit it and get a payment plan so they don't take my license away, or should I go straight to a tax attorney and say I want to just redo this with a tax attorney.

Jessica B

It sounds like you're in a tough spot. Let's try to sort this out together. Have you had a chance to review the documents your CPA prepared to see if they accurately reflect your business expenses?

They briefly showed it to me, but wouldn't give it to me because I have to pay them first, and I don't know exactly if they're accurate, but they don't seem accurate to me. They're telling me I owe $85,000 for this year. I don't even think that's possible, nor do I have that type of money. If I sign off with them, is it better for me to do that so I don't lose my driver's license, or do I just take the whole package and have the tax attorney redo it? Are you licensed in New York?

Or it doesn't matter because this is federal? I think I also owe New York state taxes too. Just need help with all of this to mitigate.

Jessica B

The only way to challenge their calculation is by filing the missing returns.

Correct, the New York state taxes are separate from this issue.

I just think that someone else would be more helpful than my current CPA and be able to negotiate better. They just aren't very helpful and not very friendly.

Jessica B

The only way to begin a negotiation with the IRS is through filing your returns. Once they are filed, then you are able to challenge their amounts.

So you recommend that I go ahead with my current accountant to file my returns and THEN consult a tax attorney for a settlement plan? How does that all work and happen?

Jessica B

That is exactly correct. When a return is not filed, then the IRS files one on your behalf until you file your return. This is why their figures are more than likely wrong, because there have been no deductions credited.

Basically, if I have all my stuff sorted with my CPA, they file the taxes, and then how do I hear about negotiating? Should I have a tax attorney re-look through all the paperwork my CPA has to make sure the numbers are right that they have on their forms for all my earnings and deductions, etc.?

Jessica B

First, once you file, then the IRS automatically recalculates the amount owed plus penalties and interest. You will then receive an official notice of the new amount.

Will I receive the notice in my personal mail, or does my accountant get the notice? And generally, how long before I receive the notice after the taxes are filed? And after I get the notice from the IRS about the new amount owed, then I contact a tax attorney to negotiate? Or is a CPA better to negotiate?

Jessica B

You receive the notice, and it usually takes six weeks.

And after I get the notice from the IRS about the new amount owed, then I contact a tax attorney to negotiate? Or is a CPA better to negotiate?

Jessica B

Once you receive the notice from the IRS with the new amount owed, it's often beneficial to consult with a tax attorney for negotiation. They can provide legal advice and help you understand your options for settling or negotiating a payment plan. However, if you have a CPA you trust, they can also assist in negotiating with the IRS. It really depends on who you feel more comfortable with and who you believe will best represent your interests. I hope I was able to help resolve your issue! If you have any other questions, feel free to ask.

If I am not making the amount of money I was making in the past nowadays, will that help at all toward negotiating (I don't have as much to pay)?

Another question is, do you recommend I try to have a tax attorney redo the work my CPA did to see if things come out better before I file?

Jessica B

Ok, thank you so much! Have a great day!

Jessica B

You're welcome! I'm glad I could help. If you have any more questions in the future, feel free to reach out. Have a great day!

Jessica B

32,347 satisfied customers

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