Stephen Wallick September 19, 2018 No Comments

Credit Myths and Misconceptions

There’s a ton of information out there and most of it is wrong. There’s information about how your credit score is calculated and even worse… how it is impacted by you simply being a consumer.

Let’s look a few of these and try to dispel them

  • Your score drops if you check your own credit.  This widespread credit misconception fools a lot of people, but viewing your own report and score is counted as a “soft inquiry” and doesn’t change the score one way or another. “Hard inquiries” by a lender or creditor, such as those resulting from your applying for credit, can slightly lower your credit score. If you’re shopping for a loan and concerned about harm to your score, know that multiple loan inquiries within a period of a few weeks are usually treated as a single inquiry to minimize impact.
  • It helps to close old accounts.  This credit myth advocates closing old and inactive accounts to hike up your score. However, this might inadvertently have the opposite affect and lower your credit score because now the credit history appears shorter. If you don’t trust yourself to put a card away in a safe place and not use it, then consider canceling newer accounts.
  • Paying off a negative record means it’s taken off your credit report.  Generally, negative records, such as collection accounts and late payments, will remain on your credit reports for up to seven years from the date of first delinquency. Paying off the account sooner doesn’t mean it’s deleted from your credit report; instead it’s listed as “paid.” Of course, it’s smart to pay your debts, both to reduce the total amount of debt you owe and to show your willingness to repay your obligations but expect the negative record to have some effect until it is purged from your report.
  • Co-signing doesn’t mean you’re responsible for the account.  Regardless of this credit myth, if you open an account jointly or co-sign a loan, you will be held legally responsible for the account. Activity on the joint account is displayed on the credit reports of both account holders. If you co-sign for a friend’s auto loan and that person doesn’t make the payments, your credit profile will be hurt and vice versa. The only way to end the dual liability is to have one party refinance the loan or persuade the creditor to formally take you off the account.
  • Paying off a debt boosts your score by 50 points.  Contrary to this credit myth, credit reporting agencies companies determine your credit score via a complex algorithm that uses hundreds of factors and values to calculate it. It’s almost impossible to calculate the difference in points changing one factor might make. It’s wise to pay your bills on time, work to lower your debts and ask that any inaccuracies be corrected. A proven record of sound financial behavior and time will have the most significant impact on your score.

No matter what your score is, the smartest thing you can do with respect to your credit is simple, keep a strong record of on-time payments, keep your credit card balances below 40% of your credit limit, and make sure that the items on your credit score are correct.  Anything and everything else is too hard to manage.

Consult an experienced Enrolled Agent for more tips on how to repair your credit score.

Stephen Wallick September 12, 2018 No Comments

Why You Should Never, Ever Pay Early (With One Exception)

Much has been written about the struggles business owners face to get paid on time, and how to get clients who are dragging their feet to pay up. Clients stalling on payments, combined with unexpected expenses, can put your business in a cash flow crunch.

As the owner of a small business, you probably have experienced watching the mailbox each day for a payment that’s overdue, even as you pay your own bills and invoices upon receipt.

If so, what I’m about to tell you may seem stingy, scrimpy, or downright tight:

Never pay early.

You won’t always have control over when you get paid, but you do have some leeway when it comes to when you pay your own bills.

Apart from the fact that you are a nice person and may feel a need to make people happy, why would you pay early? What benefits are being derived?

The harsh reality is that unless there is a clear, compelling reason for making early payments to anyone (cash discounts, pricing discounts, special delivery arrangements), DO NOT do it. Hold on to your cash as long as you possible can by closely managing accounts payable.

Hold on to your cash.

Take as long as you possibly can to pay your company’s bills without incurring late fees or impacting your ability to operate. Having said that, carefully manage your communications and relationships with your vendors.

Normally, your vendors will have terms established for the payment of their invoices presented for the delivery of their respective products or services. In order to maximize cash flow, you should attempt to extend the payment a minimum of a week or two beyond those established terms.

So here’s the ONE Exception…

Certainly, if sufficient cash is available to meet the other obligations of your company, you should take full advantage of any and all cash discount opportunities. The relative returns from cash discounts are usually quite significant and are well worth the extra effort required to manage shorter payment timeframes.

  • For example, assume a vendor offers a 2% cash discount for payments received within 10 days as opposed to the normal 30-day terms, and your company’s standard payment cycle would dictate that payment be made in 40 to 45 days. By making the payment within the discount terms you are losing the use of the funds at least 30 days sooner than would otherwise be the case. However, your company realizes a 2% return for the use of those funds over the one-month period, the equivalent of a 24% annual return (2% x 12 months).

There are very few investment opportunities that offer such attractive returns with the certainty of a cash discount. This is obviously one of the clear and compelling reasons for paying early.

Consult an experienced Enrolled Agent for more advice regarding your small business expenses.

Stephen Wallick September 5, 2018 No Comments

How Do Unpaid Taxes Affect Your Credit Score?

Your credit score after unpaid taxes

Even after you have paid the IRS, your credit record is still damaged to the point that everything except cash purchases costs you more. Believe it or not, Federal Tax Liens show on your credit record even after they are released.

This means they still hurt your credit score

It’s true that they will issue a release that you can have posted to the credit record that shows the tax has been paid, but because you have had a lien in the past your credit score is much lower than it should be.

There is another procedure that can even remove all references to the lien from your credit report once we have satisfied the outstanding tax liability.

Credit scores usually improve dramatically.

Many taxpayers have been able to have IRS reduce the penalties.

For taxpayers who don’t file an Offer In Compromise – We can help with a request to the IRS to Abate the IRS penalties for “Reasonable Cause.” This can be as simple as explaining to the IRS that your basement flooded.

It’s a great way to drastically reduce the total amount you owe the IRS.

Many taxpayers use our firm to keep the IRS away from them and their families. Most of our clients never meet or speak with the IRS. We make the IRS call us, so our clients can go to work and carry on a normal life.

If you are looking for a solution to your tax problems and want to get your life back, contact your Middle Tennessee tax resolution experts. We specializes in ending the misery that comes along with your IRS problems.

Stephen Wallick August 29, 2018 No Comments

End IRS Problems Now

I’m sure you have heard of IRS programs where you pay less than you owe.

How much less?

Well, if you qualify, A LOT LESS!

The IRS looks at these old tax liabilities and knows they will not collect most of them. So, they have set up this great program called Offer In Compromise. This program allows taxpayers to pay what they can afford regardless of the amount the IRS says they owe.

The Offer Program requires the total amount owed to be included in the settlement. Therefore, once you qualify and have an accepted Offer, you are completely paid up and your tax problems are finally over. And, even payroll taxes can be settled this way.

When I say Settle Up, I mean completely, 100%!

Once the IRS has accepted the amount you offer and you pay the reduced amount, then the IRS releases all Federal Tax Liens.

Your IRS nightmare is over and you get your life back.

Your IRS problem will not go away by itself. You only have three choices to end your IRS Nightmare.

You can do one of the following:

1. Pay the IRS 100% of What They Think You Owe Today.

2. Set up a Monthly Payment Which Never Goes Away Due to the Additional Penalties and Interest That Continue to Add Up.

3. Reduce the Total amount Owed to an Affordable Number and Get on with Your Life!

If you are looking for a solution to your tax problems to get your life back, contact your Middle Tennessee tax resolution experts. We specializes in ending the nightmare of your IRS problems.

Stephen Wallick August 22, 2018 No Comments

A Way Out of IRS Problems

Are there ways out of IRS problems?

Yes, there are ways to end IRS Problems, but you must decide to end them, no one else can decide for you. When you decide that enough is enough and you want to have the things that everyone else has and you’re really ready to do something about your IRS Problems, there are options available to you!

Our firm specializes in ending the misery of IRS Problems

There are many possible ways to end these problems, but they all require you to take the first step. No one can help you until you decide to help yourself. We are very successful in ending IRS Problems, but the taxpayer must be ready to follow our advice. We can walk you through the IRS maze. We do all the talking to the IRS. We also handle all meetings and correspondence with the IRS..

Our clients NEVER meet with the IRS!

Solutions to IRS Problems often include filing old tax returns to get you in current compliance with the IRS. IRS will not negotiate with anyone unless they are current with all required filings. This means all income tax returns and payroll tax returns, if you have employees. The IRS assumes that if you will not at least get your required tax returns filed, then why waste the time trying to negotiate with you.

It’s a rather simple request and we have easy ways to complete old tax returns. We realize that many taxpayers have lost old records or just can’t find them! We can help you file old tax returns without any records, but you have to take the first step. Once we have filed all your old tax returns, then the IRS will at least listen.

If you are looking for a solution to your tax problems, take that first step and contact your Middle Tennessee tax resolution experts. We specializes in ending the misery of your IRS problems.

 

Stephen Wallick August 15, 2018 No Comments

Can the IRS Take Your Pension, Retirement, or Social Security Check?

Imagine having the IRS attack your pension, retirement or Social Security check..

The IRS leaves no stone unturned in the never-ending quest to collect taxes, penalties and interest. Sure, people think the IRS can’t or won’t levy retirement funds.

They hope that when they get old, the IRS will forget about them and how much they owe the IRS. Don’t believe it, the IRS never forgets. They just keep adding penalties to what you owe each day until they find you, or your money, or your income source. Then it’s Pay Day for the IRS. Taxpayers with IRS problems never can build up retirement funds or assets! You’ll always be looking over your shoulder for the IRS.

This usually means you have to work until you die. You’ll have no opportunity to save up for the days when you can’t or don’t want to work anymore. Most of the time is seems like there is no end in sight. You get up every day with this incredibly large problem on your back. You wonder, “Is today the day when the IRS shows up at work or at home? Or, will they decide to levy my bank account or paycheck?”

It’s a heavy load to bear day-in and day-out. Most people around you don’t know what you’re going through. You just keep going, but you know in your heart that doing nothing about your IRS Problems are not going to make them go away.

Don’t spend your life looking over your shoulder. Contact your Middle Tennessee tax resolution experts and let’s find a solution together so you don’t have to worry about your pension, retirement or Social Security check being taken away from you.

Stephen Wallick August 8, 2018 No Comments

Purchasing a Home and Car When You Have Tax Issues

What about buying a car or home?

Driving a new car or an almost new car these days requires most people to borrow or lease the car. That’s because they cost so darn much.

Well, without the ability to walk into your local Auto Dealer and cut a deal on a new or almost new car, you’re stuck with that old unreliable clunker, just because you have a tax problem. It doesn’t seem fair, but it’s hard to get an auto loan or lease when you have an IRS problem.

Home loans are even harder to get.

Heck, they are hard to get when your credit is good if you don’t put a pile of money down on the home. Not having a home to write off causes you to pay even more taxes than your friends or neighbors because you have no tax deductions.

People that do have homes and then get into IRS problems, risk the chance of losing their home to the IRS.

Yes, I mean selling the home and giving the money to the IRS for payment of back taxes or letting the IRS seize and sell it at auction.

Having a home before you get into IRS problems may be even worse than not having a home at all. For example, if you own a home and then find yourself owing the IRS $25,000 for some income or payroll taxes, you could be making house payments on your home that IRS effectively owns. Once they file a Federal Tax Lien on your home, you can’t sell it without paying off the IRS.

This means that you continue making the monthly payments, continue to take care of the home, and the IRS just sits there and waits. You pay all the bills on your home and they get all the equity. What a Deal!

Tax issues can effect all aspects of your life and that includes the purchase of a new home or car. We are Middle Tennessee’s tax resolution experts, contact us today if you have any questions about purchasing a new home or car while having tax issues.

Stephen Wallick August 1, 2018 No Comments

Understanding the Damage That Wage Levies Can Cause

As bad as the bank levy is, the wage levy (Garnishment) is much worse.

The bank levy is a one shot deal. Meaning that the IRS must issue a new Bank Levy every time they want to clean out your bank account. This repeated effort on their part isn’t necessary with the Wage Levy or Garnishee. It’s designed to bring you to your knees.

Once a Wage Levy is issued, IRS requires the employer to immediately start withholding everything you earn above a pitifully small amount they leave you to try and survive on. At this point, you are trying to pay both current and old tax liabilities at the same time. Wage Levies often result in you receiving only a few hundred dollars per pay period. It is impossible to pay your bills and eat on the pittance they leave you out of your earnings.

IRS knows that Wage Levies cause all types of harm to you and your family, yet they mail out thousands every day.

Having IRS problems gets old

There can be no real rest and relaxation until your IRS problem is completely solved. It’s hard to keep a good job or get your credit report cleaned up when the IRS continues to issue Federal Tax Liens and Levies.

Without a bank account it’s difficult to cash your checks or even pay your monthly utility bills. Even if you’re lucky enough to have a bank account, you have to always worry about the IRS wiping out all of the money in the account without notice.

Some taxpayers with IRS Problems have just a few assets they want to hang onto. Then the IRS pulls out all of the stops. They simply seize your assets and sell them at auction!

Getting the IRS serious enough to seize your assets is not that difficult. Taxpayers with IRS Problems can end up losing everything to the IRS. For example:

  • Autos, Boats, & Motorcycles
  • Real Estate
  • Retirement Funds
  • Insurance Policies
  • Antiques, Collectibles, & Jewelry

All of these items may be very personal or sentimental in value to the taxpayer. IRS could care less. If the taxpayer will not agree to whatever the IRS wants, then they risk having their assets seized. Do not underestimate an IRS employee’s ability to follow through on the threat of seizure. Every IRS office in the country has a public list of recently seized assets and details about the upcoming IRS auction to sell those seized assets.

It is important to pay the taxes you owe to the IRS as non-payment can negatively impact your life. Do you have questions about bank levies or garnishments? Consult an experienced Enrolled Agent for assistance in dealing with these issues and avoid them in the future.

Stephen Wallick July 25, 2018 No Comments

Understanding Bank Levies

Taxpayers with IRS problems are always looking over their shoulder for the IRS. Once you owe the IRS money, they become very aggressive in their collection attempts.

One of the most common collection methods the IRS uses is the levy

They will use either a Bank Levy or a Wage Levy. If you’re lucky enough to still have a bank account, the Bank Levy allows the IRS to present your bank with a piece of paper that requires the bank to immediately withdraw all the money you owe the IRS.

Many times these Bank Levies are wrong, but the IRS doesn’t care and it’s up to you to correct the problem. Meanwhile, the checks you’ve written are bouncing all over town. The worst thing about the IRS Bank Levy is that it may capture your children’s, parent’s, girlfriend’s or spouse’s bank account, if your name happens to be on the account. Even if it’s just on there for convenience.

The IRS doesn’t care, they just want to get paid and they don’t care who pays your taxes.

The IRS will make your bank turn over the money in checking and savings accounts that have your name on them.

Further, if you deposit more money after they have cleaned the account out, IRS may issue another Bank Levy to satisfy any remaining amounts they claim you owe.

It’s like hitting the lottery for the IRS.

Once they find your money, they can continue grabbing it by issuing more bank levies.

If you are facing Bank Levies, please contact us today to negotiate a better solution with the IRS.

Stephen Wallick July 18, 2018 No Comments

Beware of IRS Penalties

How does the IRS expect you to pay off your taxes if they keep adding penalties?

I don’t know what the IRS thinks, but I do know that they ruin people’s lives every day with these ridiculous penalties.

IRS penalties are supposed to deter people from messing up their tax obligations. Instead, they bury you so far that it seems impossible to dig your way out.

What Do They Expect You to Do With Federal Tax Liens on Your Credit Report?

How can you possibly get a loan to pay them off, when your banker won’t even talk to you?

Federal tax liens prevent you from being able to borrow any money for a car or home. You can’t even borrow money to pay the IRS!

Taxpayers with IRS Problems often have to shop at Buy Here, Pay Here car lots because these car dealers don’t care if you have a Federal Tax Lien. This is because they charge so much for the cars and usually have very high interest rates. Cars are expensive enough without having to pay 18% to 21% interest on a used car loan, but with a Federal Tax Lien, you don’t have a choice.

The banks have become tough on opening new bank accounts. Anyone with a Federal Tax Lien is usually prevented from even having a checking or savings account. This makes it hard to cash paychecks and hard to pay their monthly bills.

Lacking a bank account often means troubled taxpayers have to pay more and use money orders or certified checks just to pay their rent or utility bills.

The IRS can ruin people’s lives and the time to act is nowConsult an experienced Enrolled Agent for assistance with working out a plan to avoid/work on resolving the IRS penalties you’re dealt with.