The Professional Thing to Do

It is a good idea to keep your accountant in the loop. A quick follow-up on documents you need to provide, but struggle to acquire, helps the accountant ward off nasty surprises.

The IRS loves to drag its feet when it comes to getting its paperwork out, but gives you 10 days, or else. The 10 day expected response is not hard and fast. You do need to keep the IRS informed of the timeframe for getting documents in. If your accountant knows, he should contact Revenue for you.

When pursuing an Offer in Compromise, I recommend you meet the 10 day window the IRS demands. If you don't, they will likely reject your offer and you will need to start all over again.

I know this is frustrating, especially when an IRS auditor demands documents within 10 days and then sits on them for three months. I never said it was fair; I'm just telling you how it is.

Besides, in most cases, there is no good reason to delay. The faster you get a resolution, the faster you get your life back.

I Ain't Got No Money

Behind my desk sits a file with completed documents. The client refuses to pick-up or file the forms with the IRS because she is short the amount due. Of course, you realize, she is only digging the hole deeper.

Friendly advice from your local accountant: Always file on time, even if you can't pay. Why? Because there are several IRS penalties in this world: penalties for not paying on time and penalties for not filing. The last penalty is a self-inflicted wound. File on time and set-up a payment plan, thereby forgoing the late filing penalty.

This is the easy way to reduce your tax burden. It is bad enough you have to pay taxes, why volunteer to pay extra.