Had a great time last week at Yelp’s Chicago offices in the Merchandise Mart, same building where 1871 is located. Great networking event, a lot of people, good food and drink. Also, you can’t beat free head shots from Bay Area Picture Productions!

I had a great time last week discussing the challenges that face freelancers when confronted with income taxes.

Contrary to popular belief, some personal income taxes can be discharged in bankruptcy. Whether a taxpayer can obtain relief from tax debts depends on a number of issues including the nature of the liability and the type of bankruptcy proceeding. During the course of its collection efforts, the IRS may have filed a lien against the taxpayer. The lien becomes a secured lien on all of the taxpayer’s property. If the lien was filed before the bankruptcy petition is filed, the taxpayer would not get any relief from the lien and all property would still be subject to the lien, even…

There are two principle approaches to settling prior years’ tax debts: installment plans and offers in compromise. Prior to deciding on which approach, a thorough investigation can determine which course of action is appropriate. An offer in compromise (made famous in those “pennies on the dollar” radio ads) is not necessarily more advantageous than an installment agreement. For instance, if the ten-year statute of limitations on collections will come to an end in a few years on a particular tax debt, it might be better to make installment payments for a period of time and let the statute run out. In…

In the vast majority of cases, it is more advantageous for married couples to file a joint return as opposed to married filing separately. Deductions and some credits are more generous on joint returns (especially if there are children claimed on the return). However, joint returns make both spouses liable for a tax debt for which only one is responsible. Perhaps one spouse fails to report income and related taxes and the other spouse does not find out until the IRS catches up with them. Both spouses are jointly and severally responsible for underpaid tax, interest and penalties in these situations.…

If a taxpayer does not fully pay a tax debt in time, eventually the IRS will file a tax lien against the taxpayer’s property including real estate, personal property and financial assets in order to protect the government’s interest. A lien is not to be confused with a levy. A levy is an action the IRS will take to enforce the lien. Although the filing of a lien does not necessarily mean the IRS will take immediate action, it can cause a lot of stress in the daily lives of delinquent taxpayers. A lien attaches to the property named in the…

An Offer in Compromise (OIC) is an agreement between a taxpayer and the IRS to completely settle outstanding tax debts for less than the full amount. The usual grounds for an offer are doubt as to the collectability of the debt or doubt as whether the assessed taxes are correct. Although radio and television ads constantly make claims that these “pennies on the dollar” deals are every taxpayer’s salvation, great care and patience must be taken before to see whether a taxpayer qualifies for an offer. An OIC can be very time consuming to prepare. The IRS can take a…

Installment agreements are the most common way taxpayers employ to settle their tax debts. In order to be successful in reaching an agreement, a taxpayer must be in strict compliance. All past tax returns must be filed and current year estimated taxes must be paid if required (for instance if the taxpayer is self-employed). When those past returns are filed, and accepted by IRS and the related tax liabilities accurately calculated, the ten-year statute of limitations on collections begins and an installment agreement offer can be prepared. The IRS will try to collect the entire amount owed within the statute of…

Identity theft – Eveyone should be concerned with identity theft in relation to taxes, but freelancers have special needs. The IRS transcript service for tax pros was hacked in early 2015. At first, unauthorized visitors hacked 15,000 accounts, then 70,000, then 100,000 and IRS shut down the service in May. Later investigations boosted that number to 300,000, then 500,000. The issue was fixed a year later, but the identity theft problem continues. Last spring the service was opened again. 237,000 taxpayers filed affidavits with IRS from January through September 2016. It is estimated the U.S. Treasury issued over $1B in…

Online retailers lookout! Several states want the U.S. Supreme Court

Imagine electronically filing your tax return and you receive a message from IRS stating that there has already been a fraudulent tax return filed under your social security number.

The IRS has been aggressively promoting the Earned Income Tax Credit for the past 11 years and has kicked of it’s 2017 campaign on Friday to reach low income taxpayers.

The past few years have generally been good ones for drivers in the U.S. as gas prices have trended lower.

Every year, Las Vegas-based blogger Russ Fox selects his annual Tax Offender of the Year.

The IRS recently issued a press release with a lot of good advice on records retention.

Idea Incubator Seminar, Open House and “Launch Party!”

A Studio4616 Production The Venture Hub invites you to have some summer fun at its 2016 Summer Launch Party where two if its members will be introduced to the community: MK Financial Solutions Co. Francisco Mera of MK Financial Solutions Co. has saved money for many existing businesses throughout Chicago area and may be of immediate benefit to your bottom line as well. Our first step is to determine the best corporate structure for your business to get the maximum tax benefits going forward. Our services for personal and small businesses are: Bookkeeping, Accounting, Payroll and Income Tax services. Photography by April April Wilson began…