Real Settlements for Our New York Clients
Attorney and CPA, Timothy S. Hart has worked up close and personally with many, many clients grappling with massive tax problems. He understands the stress, anxiety, and uncertainty a person feels when they get that letter or phone call from the IRS or New York Department of Taxation and Finance demanding payment of overdue taxes. With a skilled attorney at your side, you can take a deep breath, create a strategy, and find a way through to the other side. Consider these successes:
Settlements with the New York Department of Taxation
Our law firm has had tremendous success in negotiating on behalf of clients with the New York State Tax Department to settle old tax debts for a fraction of the amount due by utilizing their offer in compromise program. One client, Karen P. owed $430,000 in payroll taxes, and she settled the account for $70,000. Another client, Misha A. owed over $100,000 in unpaid sales tax from a failed business, and we were able to settle for $49,000 payable over 60 months. For another business client, Nite M. owed $850,000 in sales taxes and was able to settle the account for less than half that amount ($323,000 paid over 5 years) even though they are still in business and profitable. Lastly, in the case of another client, while married our client had a joint income tax debt of over $57,000. We convinced the New York State Tax Department she was an innocent spouse and lowered her liability to zero. Needless to say, these clients were pleased with these outcomes.
When it comes to tax law, it’s all about understanding the technicalities and finding ways to achieve solutions that clients can manage. Most clients want a resolution so they can move forward with their life, with less anxiety, but they’re scared and confused because the law is complicated and tax institutions can be intimidating. Our law firm will walk beside you every step of the way, providing reassurance, communication, guidance, and tangible solutions.
What is the NYS Voluntary Disclosure Program?
The New York Voluntary Disclosure Program encourages taxpayers who have unfiled returns and who owe back taxes to voluntarily come forward and pay outstanding balances. If a taxpayer chooses to participate in this program and is eligible, the Tax Department will not impose penalties or file criminal charges, which is a very significant benefit.
Under the program, eligible taxpayers who have not filed returns and owe back taxes, or who owe sales or payroll withholding taxes, can settle their unpaid tax situation without the threat of monetary punishments or jail time.
In order to do this, taxpayers must:
- Disclose to the Tax Department the past returns not filed and amount of taxes owed
- Pay the amount of tax owed (in a lump sum or payment plan)
- Enter into an agreement to pay all future taxes.
It must be noted that this program is not for taxpayers who filed their taxes on time but are unable to pay in full. It also isn’t available to taxpayers with unfiled returns and past-due taxes who have already been contacted by the tax department. They must wait for a bill for the tax debt owed and request a tax settlement though an installment agreement for the balance owed. If you are in either of these situations, our attorney can advise you about other settlement options that may work for you.
Eligibility for the New York State Voluntary Disclosure Program
This program has strict eligibility requirements. All applicants must meet the following criteria:
- Applicants must not currently be under an audit by the NY Tax Department for the tax type and tax years they are disclosing.
- They must not currently be under criminal investigation by New York State or a District Attorney related to tax matters.
- They must not have received a bill for the taxes being disclosed.
- They are not seeking to disclose participation in a tax shelter.
As mentioned previously, the program is not only available to people who owe income taxes. Taxpayers who meet the eligibility criteria can apply for income tax, corporate tax and sales tax settlement relief.
Information in the Voluntary Disclosure Program Cannot Be Used Against Taxpayers
For some taxpayers, past tax nonpayment can be the result of fraudulently filed returns or criminal conduct. For this program, the Tax Code has provisions that protect the taxpayer. Information provided in a New York voluntary disclosure cannot be used against a taxpayer. The Tax Department is also prohibited from sharing the information disclosed with other government agencies at any level. However, actual returns and reports can be shared with the Internal Revenue Service and other agencies in which the Tax Department has established exchange agreements.
Many people who owe back taxes to the state also owe back taxes to the IRS. If you owe back taxes to the IRS, our tax attorney may be able to help you arrange an affordable payment plan or other tax settlement for your federal tax debt as well.
Call our law firm today to arrange a time to speak to New York tax lawyer Timothy S. Hart about your tax debt problem. Call our Albany office: (518) 213-3445 or New York City office: (917) 382-5142 to set up a free consultation. Timothy S. Hart is an experienced tax attorney in New York State who has helped many people resolve their tax debt problems.
What Should Be Included in a Voluntary Disclosure?
The New York Voluntary Disclosure Program is initiated when a taxpayer completes the online Voluntary Disclosure Program application. This application asks for the amount of taxes owed, reasons why these taxes were not reported or paid, and, if you are applying for a limited look-back clause, why you believe that you are eligible.
After you complete the application, the Tax Department will review it and determine your eligibility. Until you receive an acceptance letter with an agreement, you should not file your tax returns.
If your application is approved, the New York Tax Department will send you a Voluntary Disclosure Agreement or VDA. This tax settlement agreement is only for the taxes and tax years that are listed on the application. After you review the document, you will need to sign it and mail back the agreement to the Tax Department. Along with the agreement, you are required to send copies of your tax returns that show the amount of taxes owed for the period on the agreement. These documents must all be mailed together.
Back Taxes May Be Paid in a Lump Sum or Installment Agreement
Along with sending in the New York VDA and previously unfiled tax returns, the taxpayer is required to pay back taxes owed and interest for the tax years disclosed. For some individuals, this amount can be very large and it will be impossible to pay it in a lump sum, which is why the Tax Department allows monthly installment payments to be made until tax balances are paid off through negotiated installment agreements. An affordable installment agreement can be difficult for taxpayers to negotiate because tax authorities will want as much money as they can get each month, which is why taxpayers should highly consider seeking the help of an experienced New York tax attorney.
Why You Need the Help of a New York Tax Attorney
Our attorney helps taxpayers negotiate installment payment amounts that they can actually afford to make while still being able to feed their families and pay their bills. Timothy S. Hart is both a skilled New York tax attorney and a Certified Public Accountant. He has in-depth insight into tax law and extensive experience communicating and negotiating with state tax authorities on behalf of clients and achieving successful outcomes.
When you are in a difficult tax debt situation, reach out to New York tax attorney Timothy S. Hart. We provide free consultations, so you have nothing to lose and potentially much to gain.
If you are accepted into the voluntary disclosure program, you must follow the terms exactly to avoid violating the agreement. If you violate the VDA, the New York tax department is no longer bound by the agreement. This means that the information disclosed could be used against you or civil and criminal penalties might apply. The state will be able to bring the full weight of its enforcement actions against you in order to collect back taxes owed.
Taxpayers can be found in violation of the agreement if they intentionally:
- Provide false information in the disclosure. You must be completely honest about all the information you provide.
- Omit information. Do not leave any applicable information or documentation out for the tax years for which you are applying.
- Fail to file returns. You must file any unfiled returns by the agreed-to deadline.
- Fail to pay back taxes and interest that was agreed to as part of the agreement. If you don’t pay the lump sum as agreed or miss installment payments, you may be in violation.
- Violate the tax law in the future. You are responsible for filing and paying all your future taxes.
The program greatly benefits taxpayers who have unfiled tax returns with back taxes owed to reach tax settlements. The Tax Department does not impose penalties on participants in the program, nor do they prosecute participants whose failure to pay taxes was a criminal offense.
Benefits Only Apply to Agreed-To Tax Years
Applicants need to understand that these benefits only apply to taxes and tax years that were disclosed in the application for the New York VDA. Other taxes owed that were not disclosed can still be collected and the taxpayer may face penalties and criminal tax prosecution. If you need help with other tax debt you owe, our attorney can advise you about your options.
Get Help from a Knowledgeable New York Tax Attorney
If you qualify, getting tax relief through the New York State Voluntary Disclosure Program can reduce your stress and the possibility of facing severe penalties. Timothy S. Hart will review your tax situation, advise you as to your eligibility and represent your case before NYS tax authorities. Reach out to arrange a free consultation today. Call our Albany law office at (518) 213-3445 or our New York City office at (917) 382-5142 to learn more.