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We prepare most type of tax returns:


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Gary Bode, CPA is a Master's Degreed, nation wide accountant offering tax and business services. Member of AICPA and NCACPA. Our virtual office provides excellent service to long distance and international clients. Call (910) 399-2705 for a free phone consult.

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When my business partner and I found ourselves in a land investment that was abandoned by the developers, we had no reasonable economic choice but to walk away from our mortgage loan.  While we understood that there would likely be tax consequences, the magnitude of our exposure was not fully anticipated.  Thankfully, Mr. Bode was able to work with us to strategize a defensible tax position and mitigate the tax implications of our investment loan abandonment.  I would recommend that anyone facing an investment loss that has tax implications due to debt forgiveness give Gary a call.  It is always best to fully understand the circumstances and the tax rules and related options before paying a hefty bill.  Thanks Gary!

Brian D. - CPA

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Even though Gary enjoys helping colleagues, we no longer provide free consults to other tax preparers. He's happy to consult on an hourly billing basis if our schedule allows.

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IRS Penalty CPA discusses Penalty Abatement

IRS penalty CPA

Gary Bode, CPA: Don’t ignore an IRS penalty notice.

CPAs often seek IRS penalty abatement for their clients. Annual IRS penalties are staggering; the CPA Insider cites 38.6 million penalties issued in 2011 totaling over $31 Billion. Yes Billion. This post discusses penalties in general and covers personal, business and payroll tax penalties.

The IRS abates penalties under some circumstances. Here are some pointers.

General Tips from an IRS Penalty CPA

  • Don’t open up other issues with the request. Stay on point.
  • Be current on filing tax returns before requesting IRS penalty abatement.
  • Clear up past penalty issues before requesting abatement on a newly issued IRS penalty.
  • Phone calls can work, but I follow-up with a letter. I cite the date of the call and the Agent’s name and ID number.
  • Make the written IRS waiver request professional. Don’t hand write it.
  • Make the request clear and concise. I try for a one page letter.
  • Include relevant documentation. Try to think of this like a high school project with a hard-line teacher.
  • Look at your circumstances from the IRS Agent’s point of view. Which is probably cynical and rushed.
  • Understand the tax issues involved. Do the background research.
  • Respect the IRS timelines.
  • Cite the penalty notice number and date.
  • Put your name, Social Security number and address on the waiver request.
  • Don’t poke the Bear. Be respectful.
  • Send it by certified mail.
  • Don’t assume they’ve agreed. Follow up.

“You don’t always need an IRS penalty CPA to get a penalty abatement. But if you decide the dollar amount or other circumstances warrant a CPA, consider giving us a call at (910) 399-2705. We can serve you regardless of where you live.”
– Gary Bode, IRS penalty abatement CPA

When do you need an IRS penalty CPA?

Well that depends, but CPAs usually earn their keep. Here are some questions to ask yourself:

  • Will I open up other areas of my past tax returns to IRS scrutiny?
  • Do I understand the IRS penalty or audit notice?
  • Do I understand the tax issues involved?
  • Is the amount demanded a big deal to me?
  • Do I have adequate written communication skills?
  • Can I tell my side clearly and concisely?
  • Am I too emotionally involved on the process to be effective?
  • Am I comfortable dealing with the IRS?

In general, it never hurts to ask for a penalty abatement unless the request pushes IRS timelines. Sometimes you must pay the penalty and try to get it back. Hope the above helps!


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