Yes, the IRS is cutting you a break during this pandemic, but if you’re not careful, you can still lose money.
by Hope Dean for Debt.com
With thousands getting sick every day, who worries about their taxes?
Mitch doesn’t — and he owes the IRS $350,000. Mitch runs his own business just outside of Atlanta. His tax problems date back 15 years.
“In 2006, I sold a company for almost $1 million and invested almost all of it in real estate,” he says. “I found out it was a scam, and they took all my money — but it still left me with capital gains.”
In other words, Mitch lost everything but still owed the IRS for those losses.
“My world was kind of over,” Mitch says. “I didn’t have a lot to live for, quite frankly. But I’m a man of faith, and I chose to believe things get better.”
Mitch is also a man of action. Instead of ignoring the problem — which the IRS says is all too common — Mitch consulted multiple tax pros before settling on one to help him out.
“I realized I was in a lot of trouble and I needed some professional help,” he says. “They saved me almost $200,000 with the IRS and $33,000 with the state.”
They turned out to be Community Tax, a national tax-relief firm that turns 10 this year.
“They saved my financial life,” Mitch says. But he has a warning for all those like him who aren’t seeking help: “The IRS doesn’t go away during a pandemic.”
Death and taxes
Mitch isn’t a rare case. The IRS says in 2018, 14 million Americans owed $130 billion in back taxes. And that was two years before the pandemic.
The pandemic has created two problems, says Sarah Nieschalk, an assistant vice president at Community Tax, the tax-relief firm where Mitch ended up. One problem is financial, and the other is psychological.
“As a tax professional, I see countless cases of folks whose tax issues have snowballed until the problem seems too large to handle,” she says. “At the end of the day, these folks simply want a fair solution to the problem, but…