Tax resolution

[ED SMITH]

Last year I had a client that wanted to do an Offer in Compromise. He was from an eastern European country on a green card. He owed over $15K and because of his income he looked like a good candidate. After pulling his transcripts and discussing his situation with him several times, he sent an email telling me he had moved back to his home country.

He still wants to make some sort of settlement with the IRS. Does anyone have any ideas or experience for this type of situation?

I'm also curious about him leaving the country without obtaining an exit permit.

Ed Smith

[George Boutwell]

Take Your Shoes Off and Show Your Form 2063

I'm also curious about him leaving the country without obtaining an exit permit.

What's so curious about the country that brought you the Transportation Security Administration, also perpetuating (but not enforcing) the archaic Alien Tax Clearance statutes?

If every departing alien complied with the law, IRS offices would be crowded with applicants and the agency would accomplish nothing else. Come to think of it, that might not be a bad idea.

When the law was enacted, people left the country by steamship or DC-3. I doubt there was substantial compliance then, but it's absurd to expect it now.

But you never hear the complainers about "those people" who arrive without documentation, attacking "those people" who leave without it (and then come back a few weeks later after their European vacation).

[ED SMITH]

Exit permit

My wife did not become a citizen until '96. Up until then, every time we left the country we had to get a little ticket stapled into her passport from the IRS. When we checked in at the airline counter, they asked to see it.

Anyway, I didn't intend this to be the subject of the posting. My question is about how to get taxes resolved for someone that has moved out of the country.

Ed Smith

[George Boutwell]

Globalization

My wife did not become a citizen until '96. Up until then, every time we left the country we had to get a little ticket stapled into her passport from the IRS. When we checked in at the airline counter, they asked to see it.

Anyway, I didn't intend this to be the subject of the posting. My question is about how to get taxes resolved for someone that has moved out of the country.

Ed Smith

I too have traveled overseas with resident aliens who were asked to show their passports when they checked in for a flight. They did not have a tax clearance stapled inside, and they still were allowed to board. Airlines are not in the business of enforcing tax rules, any more than the Border Patrol stops cars headed to Mexico or Canada -- that's what makes us different from countries like the former Soviet Union, we don't have exit controls.

As far as resolving tax problems for someone out of the country, what you do is nothing different from what you would do for someone in Nome for the winter. In fact, if they have an email address and the ability to download and print PDF files, it's probably easier than if they are 100 miles from your town, and offline. What you need to keep in mind is that it may be much more important to have a clean tax record, if their immigration status or potential citizenship status is questioned. Failure to pay taxes can have criminal consequences. Criminals are deported, or if they have already left, they are not allowed to return.

[ED SMITH]

Tax resolution

George-
I run a virtual tax business. I have clients I never see and a few I have never even talked to.
A phone, email, fax and a scanner are all that is needed. My latest client is in Michigan, I am in California.

Distance is not a problem. The question is meeting the requirements of an Offer in Compromise with all the documentation that needs to be submitted. Would the IRS even process an OIC with docs in Polish? And if so would they accept the clients translation of them or would they required a certified translation? And finally, under which reason, under Item 6 of form 656, should the offer be submitted, Doubt as to Collectibility or Effective Tax Administration?

So, you can see your answer doesn't come close to solving the problem.

Ed S

[bertrans]

OIC/Foreign

Yes, the IRS will consider an OIC from a TP in a foreign country; technically, the documents, if in a foreign language, must be accompanied by a certified English translation.