“Because seasonal hiring often occurs in a hurry, it’s important that businesses adhere to their usual hiring policies and processes so they don’t overlook critical tax documentation and considerations,” said Brian Biffle, president of 20/20 Tax Resolution in Broomfield, Colo. “First and foremost, it’s important to remember that part-time and seasonal employees are subject to the same tax withholding rules that apply to any other employees.”

To ensure against unexpected tax issues, it’s important that businesses have the resources and the record-keeping systems in place to manage an influx of temporary employees during the busy season, according to Biffle. Maintaining accurate records is not only critical with respect to payroll issues, but also down the road should problems arise. In addition, there are a number of other considerations that must be addressed, Biffle said. For example:

• Correctly identifying employment status (1099 or W2)
• Incorporating additional administrative costs (payroll management, for example) into hiring plans
• Ensuring any potential health care coverage costs (if required for seasonal employees working 30 hours or more per week) are factored into hiring decisions – a rare requirement based on a variety of criteria but worth verifying when making hiring decisions
• Anticipating the unexpected and planning accordingly

“The retail business especially can be unpredictable, particularly if a ‘hot’ item captures consumer attention creating additional hiring needs. So it’s smart for employers to examine all variables that may impact the bottom line – including hiring costs,” Biffle said. “It can be very easy to neglect costs like these during the rush of the season when business is plentiful, but doing so can put a business in a serious financial bind.”

Conversely, Biffle said that seasonal workers should pay attention to any tax implications created by accepting a holiday job. Workers should ensure they factor in tax withholding to cover any tax liability (whether done through the employer or as a self-employed individual), including federal income tax, state income taxes, Social Security and Medicare (FICA) taxes, as well as any local taxes that may be required.

Flurry of seasonal hiring can lead to errors resulting in unanticipated #tax liabilities…
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“Businesses facing difficult tax problems can be very vulnerable,” said Brian Biffle, president of 20/20 Tax Resolution. “Owners feel they need to react quickly but they are often worried about facing IRS penalties and can be unsure of tax policy regulations. The rush to solve the problem, combined with a lack of knowledge, can make identifying a qualified tax resolution provider a challenging process.”

However, there are many reputable professionals providing tax resolution services, Biffle said. The key is to identify one that is knowledgeable, diligent and will actually help solve tax problems.

“Many tax resolution companies work very hard to provide honest and effective counsel to their clients,” said Biffle, whose company has successfully managed tax issues for more than 26,000 clients nationwide as of April 2016. “But there are distinct warning signs business owners should recognize when searching for a provider.”

1. Overpromising – No tax consultant can guarantee results, whether those results include reducing tax liabilities or promising acceptance into the IRS Offer In Compromise program. If a company makes immediate guarantees with no information to back up its claims, it may be a sign to seek a different provider.
2. Lack of transparency – Every tax resolution provider should be comfortable delivering background information on their company in an upfront and easily understood manner. The provider should be able to discuss company ownership, years in service and past client successes. When they aren’t able to do so (or are unwilling to do so), a business owner should move on.
3. Demands for in-full payment upfront – As in any relationship with a professional services provider, trust is a key indicator of partnership. If a tax resolution provider wants to charge a fee just to speak with a consultant, you can end up paying an unlicensed salesperson to simply tell you what the company can do for you. Find a company that provides initial consultations completely free of charge.
4. Lack of credentialed consultants – A competent tax resolution provider will not utilize unlicensed commission-based sales people to provide a diagnosis of your tax issue. Remember that only a CPA, an attorney or an Enrolled Agent can represent you before the IRS. If your tax resolution provider is not offering you assistance through a seasoned, credentialed consultant, it’s a good sign the provider will not be working in the best interests of the business.
5. Unclear next steps – The provider should be able to discuss who will be managing the work, how often they’ll be in contact and what a business owner can expect with respect to ongoing reporting of progress. If these specifics are unclear, it’s a sign to walk away.

“These are the key indicators that should raise consumer concern,” Biffle said. “Of course, business owners should always use their best judgment, but as in so many aspects of business, if it feels too good to be true, it probably is.”

As a #SMB owner seeking tax resolution services, there are important warning signs… @2020TaxResInc
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The Collection Division is responsible for collecting taxes that have not already been paid or placed on a voluntary resolution program.  Unfortunately, there is quite a bit of misinformation regarding cases assigned for collection by the IRS.  Regardless of your circumstances here are a few of the most common myths of IRS collection cases:

1. You’re not responsible for mail you never get: Many taxpayers believe, mistakenly, that if they don’t let the IRS know their most current address they are not responsible for collection letters the IRS is sending.  Nothing could be further from the truth.  Generally, the IRS’ requirement for service by mail is the taxpayer’s last known address.  Therefore, if the taxpayer has not notified the IRS of an address change the taxpayer will actually be the one to suffer by being in the dark.  This issue can end up costing a taxpayer valuable collection appeal rights.
2. The IRS will settle for “pennies on the dollar”: The IRS does have a settlement program called the Offer in Compromise (OIC). Interestingly, offers happen probably more often than many tax professionals think, but a lot less than taxpayers have come to believe. The IRS’ own numbers over the past two years show an Offer in Compromise acceptance rate of roughly 40%.  Still, the key to a successful offer is the pre-qualification process.  There are many nuances to an Offer in Compromise case and as a result, there is no substitute for experience when it comes to presenting a viable, realistic offer. 
3. The IRS can collect against you for a lifetime: Sometimes dealing with IRS Collections for more than a day can feel like a lifetime.  Especially, if you’re on hold.  In fact, the rules concerning how long the IRS can pursue unpaid taxes are quite clear.  Generally speaking the IRS’ statute of limitations for collection is ten years from the date a liability is assessed.
4. The IRS will take your home: In actuality, the IRS is not going to take your home.  That’s not to say that the IRS can’t take it… only that the IRS doesn’t do it.  Seizures (which can include home, car, boat, etc.) themselves are fairly rare for the IRS.  In the past two fiscal years, the IRS has reported fewer than 500 total seizures.  And because policy statement and stricter rules make seizing a primary residence more difficult it becomes increasingly difficult to face that proposition.
5. At least the IRS can’t get to your retirement accounts: Unfortunately, the IRS can get to retirement accounts.  There are very few assets exempt from the reach of an IRS levy.  They are outlined specifically in the Internal Revenue Code and include (here), but are not limited to, Workmen’s Compensation, Unemployment Benefits and minimum exemptions for salaries and wages.  What one won’t find exempted by rule are 401k accounts, stock accounts or Social Security benefits.

When it comes to #IRS collection cases, are you falling for one of the top 5 myths? @2020TaxResInc
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Of course, dealing with IRS Collections is a nuanced process that should not be taken for granted.  But, dispelling the myths above should help bring more clarity to what one may face when dealing with IRS Collections.

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