home loan finance blog
First prepare yourself, allow at least an hour to complete this task. Make your self a cup of tea or coffee and remind yourself that you must be patient. Make the call. Don’t procrastinate. If you owe the Department of Treasury (IRS), the penalties and interest are compounded daily.
1. Be polite, be honest and be brief with your answers. Do not volunteer information unless you know it will be to your advantage.
2. Have all of your papers in front of you. If you don’t have the papers in front of you this could cause a major delay. You must be able to explain to IRS why you are calling.
3. Do not expect any Tax advise. IRS phone agents are trained to provide you with information and tax code (law) they do not give advise other then to say what the law allows. Your Tax professional can provide advise on what to do and what NOT to do.
4. If you owe IRS, the agent will ask you for your bank account information, either give them the bank accounts numbers or tell them that you will call them back with that information. DO NOT LIE. It is a felony to lie to an IRS agent.
5. They will ask for the name and address of your Employer. Now you are on the hook – if you are employed you have to tell them the truth. They can and will use this information to attach your wages should you default on your agreement with them.
6. If you owe a sizable amount, they will want to complete a 433A over the phone. This is a mini financial statement that will enable them to determine how much YOU should pay THEM each month. This is not a form you want to complete with an IRS agent. It would be best to call your Tax Professional.
(Example: You include your child’s private school or your $80.00 a month cable bill in your monthly expenses when filling out your 433A; NEITHER of these deductions are accepted as a valid monthly expense by IRS – Call your Tax Professional)
7. They may ask you about your 401K or any other additional income. Again, it is a felony to lie to IRS. Softly tell the agent WHEN you will call them back. Hang up the phone and call a Tax professional.
If you don’t understand the tax codes and you owe a sizable amount in taxes, it is best to do your homework before contacting IRS.