Short answer: Tax resolution services help individuals and businesses resolve tax problems with the IRS or a state agency, such as back taxes, unfiled returns, levies and audits. A representative reviews your account, helps you get compliant, and works toward an option you may qualify for, such as a payment plan, penalty relief or an Offer in Compromise.
This guide explains what the work includes and how to judge a firm. To see how we handle cases, visit our tax resolution services page. Tax Resolution Plus is a private firm. We are not part of, or affiliated with, the IRS, the CDTFA, the FTB or any government agency.
What problems do tax resolution services handle?
Tax resolution covers most situations where a taxpayer owes, is behind, or is under review by a tax agency. The common ones are unpaid balances, missing returns, collection actions, payroll tax debts and state tax issues. Many cases involve more than one of these at once.
- Back taxes. A balance with the IRS or a state agency that you can't pay in full. Penalties and interest keep adding to it until it's resolved.
- Unfiled returns. One or more years with no return. The IRS may file a substitute return for you, which usually doesn't include the deductions you could claim. See unfiled tax returns help.
- Levies and wage garnishments. The IRS or a state agency takes money from a bank account or paycheck to collect a debt. See IRS wage garnishment and bank levy help.
- Payroll tax problems. Unpaid payroll taxes can lead to the Trust Fund Recovery Penalty, which can make business owners and other responsible people personally liable. See payroll tax and Trust Fund Recovery Penalty help.
- State tax issues. In California, that includes income tax with the Franchise Tax Board (FTB) and sales and use tax with the CDTFA, including CDTFA sales tax audits.
How does the tax resolution process work?
Most cases follow the same order: understand the problem, get authorized, gather the facts, get compliant, then request an option. Skipping a step, especially filing missing returns, usually stalls the case. Here's how the steps typically run.
- Consultation. You explain what's going on and share any notices. At Tax Resolution Plus this is a Free 30-minute consultation.
- Representation authorization. You sign a form that lets your representative speak with the agency for you. For the IRS, that's IRS Form 2848. For the CDTFA, it's form CDTFA-392.
- Transcripts and records. Your representative pulls your account transcripts to see what the agency shows: balances, penalties, missing years and collection status.
- Compliance. Missing returns are prepared and filed. The IRS generally requires you to be current on filing before it approves most payment options.
- Choose and request an option. Based on your finances, your representative prepares the request that fits, along with the financial forms and documents the agency asks for.
- Follow through. Your representative answers agency follow-up questions and helps you keep the terms, such as making payments and filing future returns on time.
What resolution options may be available?
The IRS offers several ways to resolve a balance, and the right one depends on your income, expenses, assets and filing history. Common options are payment plans, penalty relief, Currently Not Collectible status and an Offer in Compromise. The IRS, not a private firm, decides whether a request is approved.
Installment agreement (payment plan)
A payment plan lets you pay a balance over time. Penalties and interest continue until the balance is paid. (IRS: Payment plans) Read more in our guide to IRS payment plan options.
Penalty relief, including First-Time Abate
The IRS may remove certain penalties for reasonable cause or under its First-Time Abate policy. First-Time Abate generally looks at whether you had no penalties in the three prior tax years (some penalties don't count), filed all required returns, and paid or arranged to pay what you owe. (IRS: First-Time Abate) See our penalty abatement guide.
Currently Not Collectible status
If paying would leave you unable to cover basic living expenses, the IRS may temporarily delay collection. The debt still exists, interest and penalties continue, and the IRS may review your finances later. (IRS: Temporarily delay the collection process)
Offer in Compromise
An Offer in Compromise is an agreement to settle a tax debt for less than the full amount owed. The IRS looks at your ability to pay, income, expenses and asset equity, and many applicants aren't accepted. (IRS: Offer in Compromise) Learn more about Offer in Compromise help.
Who can represent you before the IRS?
Only certain tax professionals can represent you before the IRS, and Enrolled Agents are one of them. An Enrolled Agent has earned the right to represent taxpayers before the IRS by passing a comprehensive IRS exam or through qualifying IRS experience. Enrolled Agents can handle audits, collections and appeals. (IRS: Enrolled Agents)
Representation starts with a signed Form 2848. It names your representative, the tax matters and the tax years they can act on. Once the IRS records it, your representative can receive copies of notices, speak with the IRS and respond for you on those matters. You can revoke it at any time.
How do you choose a tax resolution company?
Look for credentials you can verify, a clear explanation of fees, and honest talk about outcomes. The Federal Trade Commission warns consumers about companies that charge large upfront fees or promise results no one can promise. (FTC: Trouble Paying Your Taxes?) Ask these questions before you sign:
- Who will work on my case? Ask for the name and credential of the person who will be your representative, not just a salesperson.
- What are their credentials? Enrolled Agents can represent you before the IRS. Ask which credential your representative holds.
- How are fees billed? Get a written explanation of the fee, what it covers and when it's due. The FTC advises walking away from anyone who demands the whole fee upfront.
- Do they promise an outcome? No firm can promise a result. Only the IRS or the state agency decides which options apply to you. Be wary of a firm that says otherwise before it has reviewed your transcripts.
- Do they review your account first? A real recommendation comes after pulling transcripts and reviewing your finances, not during a first sales call.
- Are they local and reachable? A local office and a named contact make it easier to get answers while your case is open.
Why Tax Resolution Plus?
Tax Resolution Plus is a team of Enrolled Agents and former state auditors in Irvine, California. Our co-founder, Shawn Zali, is a former CDTFA auditor with more than seven years at the agency. We handle IRS matters and California state matters, including FTB and CDTFA issues.
- Federal and state experience. Many clients owe both the IRS and a California agency. We look at both together.
- Sales tax depth. For businesses with CDTFA issues, see California sales tax return filing, CDTFA sales tax refund claims and California use tax help.
- Local to Orange County. We're at 2575 McCabe Way, Suite 210, Irvine, CA 92614. See Orange County tax relief and Irvine tax relief.
Every case depends on its facts. After we review your account, we'll explain which options you may qualify for and what each involves.
Frequently asked questions about tax resolution services
Is a tax resolution service worth it?
It depends on your situation. Some people can set up a simple payment plan directly with the IRS. A representative may be worth considering when you have several unfiled years, an active levy, a payroll tax issue, both federal and state balances, or a notice you don't understand.
Can a tax resolution company stop a levy?
A representative can't stop a levy on their own, but they can request a release from the IRS. The IRS may release a levy in certain situations, for example if it creates an economic hardship or you enter into an installment agreement. (IRS: Levy) See our wage garnishment and bank levy help.
How long does tax resolution take?
It varies with the option and the agency's review. Filing missing returns comes first, and some requests, such as an Offer in Compromise, involve a longer IRS review than a payment plan. After we review your transcripts, we explain the steps your case is likely to involve.
Do you handle state taxes too?
Yes. We work on California matters with the Franchise Tax Board and the CDTFA, including sales tax returns, audits, refund claims and use tax. State programs have their own rules, so we review them separately from any IRS balance.
What should I bring to a consultation?
Bring any notices you've received, your most recent filed returns, and a list of the years you think are unfiled. If you owe a business tax, bring your payroll or sales tax records for the periods involved.
Talk to a tax resolution team
Tell us what's going on with the IRS or a California tax agency. One of our Enrolled Agents or former state auditors will review your situation in a Free 30-minute consultation, or call (866) 900-9001. Learn more about our tax resolution services.
Tax Resolution Plus Inc. is a private firm in Irvine, CA, and is not affiliated with the IRS, the CDTFA or the FTB. This article is general information, not tax advice for your situation.