What If Someone Does Not Report Income To The IRS?

What if someone does not report income to the IRS? Most of the time, it's very difficult to find out if a person is making money on the side and not claiming it. Most of the time, it's very difficult to...

Most of the time, it's very difficult to find out if a person is making money on the side and not claiming it. Particularly if they have just been taking cash money or if you are taking the check and drawing cash in it at that person's bank. But here is the thing, sooner or later, the IRS is going to find you and it is better if they find you sooner because all of the penalties and interest make that amount grow so much. I have people all the time that say "okay, I owe the IRS $50,000. Here is $5000. Go see if they will settle for it."


It doesn't work that way with the IRS. The amount of tax owed has nothing to do with the settlement. You can owe $50,000 or you can owe $100,000 and that didn't have anything to do with the amount of tax that they are going to settle for. They consider the penalties and interest as part of the tax. So I have people all the time that say "I am willing to pay the tax. But they've got me down for $20,000 in penalties and interest. See if they will just take the tax and just forget about the penalties and interest." No, they will not. They consider that as part of the tax now. It does not work that way, I am sorry. They don't have any comprehension of the guidelines for settling the case. The average person just doesn't know what the IRS is looking for on the inside. They don't have any comprehension. I had a guy the other day that makes over $10,000 a month. Yet his expenses are over $11,000 a month. He owes $25,000 in credit cards, he has got a $25,000 boat, and they have got timeshares. They are living a good life, right. The IRS does not care about all of those fluff items. If you make $10,000 a month, they want their taxes and they are not going to settle. They will take a payment plan. Don't misunderstand, they are not going to settle the debt for less than what you owe because you can sell that boat and not spend that $1000 a month and pay the IRS. I agree with the IRS in that case. I have a single lady right now in New York; she makes $2300 a month. They have levied her wages. She is not married. She only has herself and she only makes $2300 a month and she qualifies to settle that debt. Well, she didn't have any assets. She doesn't own a home, she is paying for her car, she has no savings, no CDs, no mutual funds, no 401K. She has nothing and she spends $2400 a month. The IRS levied her wages. Now the reason they levied her wages is because she should have contacted me when she got that CP 504. They were looking for assets and intending to levy. People don't contact me and then they get the wage levy. It takes us usually 3 or 4 weeks to get that released, when we prove and document to the IRS that this person really can't pay. See, the IRS doesn't take it for a grain of salt. You have to document everything so that they can see in black and white that that person cannot pay.


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