Dealing With the IRS

by Don H. Campbell, J.D.

Notice of an audit or demand for payment from the Internal Revenue Service makes many people numb with fear. There are, however, options available with the help of an attorney for dealing with the IRS which may be well worth the effort and expense. The first option is filing bankruptcy. Upon filing, all collection efforts will stop by the IRS and any other creditors. In some instances, personal taxes can be discharged; but in the very least, you are given the time and opportunity to work out a practical payment plan with the IRS.

The second option involves making an "offer in compromise" of a specific amount less than that demanded by the IRS for payment. For the IRS to accept an offer in compromise, there must be (1) doubt as to whether the amount claimed by the IRS is 100% correct, (2) reasonable concern that there are sufficient financial resources available to pay the amount demanded by the IRS, or (3) a showing of extreme financial hardship resulting from illness or other personal circumstances. If you meet one or more of these requirements, a Form 656 must be submitted with various documents justifying why the IRS should accept less money. When successful, the reduction in the taxes, penalties and interest can be significant.

With a qualified professional to assist you, another option may be to file amended returns to correct previous errors and possibly wipe out interest or penalties claimed by the IRS. Even for those individuals who have failed to file tax returns, it is not too late to deal with the IRS in an effective manner, so long as you have competent representation.

Therefore, whatever your tax dilemma, help is available. For more information, you should visit an attorney experienced in working with the IRS. For a referral, contact your local lawyer, the State Bar of Texas or your CPA.

If you would like to speak to one of the attorneys at Mounger and Campbell, LLC about this or any other legal topic, you may ask us to contact you or call 512-847-1308.

Debt Collection Abuse

 by Carrie E. Campbell, J.D.

In 1978 Congress implemented the Fair Debt Collection Practices Act (FDCPA) in an attempt to restrict abusive collection practices and to provide specific rights for consumers. Most debt collectors comply, but more than 25 years after the law has passed, many debt collectors still flagrantly violate the law.

The FDCPA only regulates "debt collectors." Debt collectors include collection agencies and attorneys attempting to collect debts. Debt collectors do not include companies - such as credit card issuing banks - attempting to collect money for their own business.

Consumers who are victims of debt collection harassment have important legal rights which can be resolved in local justice of the peace courts. The FDCPA allows for successful consumers to recover from thecollection agencies their actual damages, attorney fees, costs of court and up to $1,000 for statutory damages. Many attorneys will assist consumers with these cases on a contingency fee so that the consumers, who many times are without financial resources, can protect their rights.

The prohibited acts are many, but generally the debt collectors are not allowed to (1) threaten criminal action, (2) use abusive language, (3) repeat telephone calls in an effort to harass, (4) contact neighbors or fellow workers, (5) contact consumers who have asked not to be contacted, (6) threaten to foreclose on a Texan’s house, repossess a Texan’s car, or garnish a Texan’s wages, (7) pretend they are affiliated with a governmental agency, (8) misrepresent the legal status or amount of a debt, and/or (9) threaten a law suit is imminent or has been filed when they do not intend to file a suit.

There are many other prohibited acts under the law. Consumers must bring their claims within one year of the collection abuse. If you have any questions regarding consumer rights under this law, contact an attorney.