The Taxman Can Make Mistakes

Posted by on Dec 15, 2015 in Bankruptcy, Tax Law | No Comments

The interesting thing about the IRS is that they are the 800 pound gorilla in the room. Unfortunately, that gorilla sometimes beats his chest and you have to pay attention to him. Recently, I had a client (let’s call him Paul) who received notices from the IRS in which they alleged he owed approximately $208,000 in tax debt. Needless to say, Paul was speechless and had no idea how to handle the tax debt. Paul had recently filed a Chapter 7 bankruptcy and was told that the bankruptcy filing handled all the debt and that a “fresh start” was his for the taking. The IRS was not as inclined to agree.

Paul emailed me the Notice and explained why he was so confused as to how the IRS could be claiming that the $208k bill was owed. I discussed with Paul that there tax debt may be discharged in a Chapter 7 bankruptcy in specific circumstances that may not apply to him. He was unaware of this, but we reviewed his history and I agreed that the IRS incorrectly classified this tax debt as “non-dischargeable”.

Paul retained our office and we moved forward to assist him. I called the IRS and notified them of the gigantic mistake that could potentially cost Paul a $208k bill. At first the IRS identified that there was no mistake had been made, but that the tax debt should remain and Paul would be responsible for the bill. However, we held additional discussions on the matter and discussed the matter with the “IRS Group Manager” and finally the IRS agreed to their mistake. Paul is now 100% tax debt free. See the images attached that identify the amount owed in September 2015 and November 2015.

Account Transcript

We, at MacLeod Peterson, can and have faced the IRS on matters that need to be corrected. We want to be your advocate in any tax matters. Please call or email us today to learn more of how, like Paul, we can assist you with the Internal Revenue Service or other taxing authorities.

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