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When you need tax relief in Fort Lauderdale, look no further than Ronald A. Muscarella CPA. Specializing in back tax return settlements, our fully licensed and insured accountants are able to provide a variety of accounting services for you. Whether you are preparing for an IRS audit or looking to incorporate a business, we've got the necessary expertise to help.

IRS Offers Struggling Taxpayers a Fresh Start

The Internal Revenue Service announced this May that it will offer more flexible terms for its Offer In Compromise (OIC) program. These changes will enable many financially distressed taxpayers to clear up thier tax problems and in many cases more quickly than in the past. This IRS Fresh Start Program will assist some taxpayers who have faced the most financial hardship in recent years. In general, an OIC is an agreement between a taxpayer and the IRS that settles the taxpayer's tax liabililty for less then the amount owed. An OIC is generally not accepted if the IRS believes the liabilty can be paid in full as a lump sum or through a payment agreement. The IRS looks at the taxpayer's income and assets to determine the reasonable collection potential.

Here are the OIC changes effective May 12th 2012:

* Revising the calculation for a taxpayer's future income. The IRS will now look at only one year of future income 

   instead of four years for offers paid in five or fewer months. For offers paid in six to twenty four months future

   income will be considered for two years instead of five years. This change alone will allow a more affordable

   offer amount for many Taxpayer's who under the past law were required to make an offer amount for these

   additional years of future income potential.


 *Allowing taxpayer's to repay thier student loan minmum payments on student loans guaranteed by the federal

   government will be allowed for the taxpayer's post-high school education. As always proof of payment must be

   provided to receive credit for this expense.

* Allowing taxpayers to pay state and local delinquent taxes. When a taxpayer owes deliquent federal and state or

   local taxes, and does not have the ability to fully pay the liabilities, monthly payments to state taxing authorities

   may now be allowed in certain circumstances.

* Expanding the allowable Living Expense allowance Standard allowances incorporate average expenses for basic

   necessities for taxpayers in similar geographic areas. These standards are used when evaluating installment

   agreement and OIC requests. The National Standard misccellaneous allowance has been expended to include credit

   card payments.

   Keep in mind that the Fresh Start Initiative Program provides more flexiblity and may work to resolve Federal tax

   liabilty issues for a broader spectrum of taxpayers, but many of the rules remain unchanged. It is best to hire

  an experienced professional to represent you in matters of this type before you get the ball rolling. Your first step

  should be to speak to a CPA experienced in IRS Problem resolution and confirm which Fresh Start Initiative Program

  may work for you.


Ronald A. Muscarella- AICPA