State Tax Relief
While there are similarities between the IRS and state tax collections, they often operate quite differently than the IRS. Some states even have multiple taxing authorities that administer the collection of each type of tax. State taxing authorities also differ from the IRS in that they are usually faster to collect on back taxes, and even more aggressive in their collection efforts, making levies, garnishments, and seizures commonplace.
Unlike the IRS, each state is limited to a finite annual budget that relies 100% on tax revenue. If they don’t collect the taxes, they literally can’t pave roads or pay for schools. The IRS, however, is actually an arm of the U.S Department of Treasury which literally has the power to print money. A state government does not, making them more desperate and aggressive to collect.
If you have a state tax liability or even a bank levy or wage garnishment, seeking professional guidance from a licensed tax professional is a wise first step to getting it fixed. Tax negotiations are a bad “do it yourself” project, and penalties and interest rack up faster than the worst credit card.
Our licensed tax professionals specialize in negotiating favorable terms with the state, while allowing our clients to focus on their own priorities.
Priority One: Stopping Aggressive Enforced Collections
Common State Tax Types and Issues
We deal with a wide range of state tax types and situations:
- Business taxes
- Personal taxes
State Tax Relief Options
Because there are so many factors affecting your rights and options under the tax code, it’s impossible to determine what strategy is best for you without a conversation. However, the following is a list of potential options for resolving your state tax issue.
Most of our clients can’t pay all of their back taxes in the time frame or amounts that the state is demanding. We will get you the terms that you want, not that the state is offering.
Offer in Compromise:
Some states have a program similar to the IRS’s Offer in Compromise, the “Pennies on the Dollar” settlement. Depending on your income and assets, you may qualify. The paperwork is always difficult and the state will not do you any favors in the process. That said, we have gotten many for our clients, with some savings in the hundreds of thousands of dollars.
Currently Not Collectible Status:
Many of our clients at present don’t have the funds for an installment arrangement, though their assets or income make an Offer in Compromise impossible. For these clients, we may pursue a “CNC” status.
Corporate Shut Down:
The closure of a corporate entity sometimes makes the most sense, saving you substantial amounts of money.
Starting a new corporation with a new tax ID number, new identity, and a fresh start may make sense.