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JK Harris Combined Efforts Provide Customer with Happy Ending
NORTH CHARLESTON, S.C. – Thanks to the combined efforts of two divisions of JK Harris and Company, a client in Virginia sleeps better at night.
JK Harris and Company is the largest and most successful tax resolution firm in the country. JK Harris 165 Services is a division of JK Harris & Company and is the nation’s leader in assisting victims of investment fraud recover some of their losses through an often overlooked tax provision of the Internal Revenue Code, Section 165(c)(2). Section 165 allows victims to accelerate their losses and realize substantial tax benefits.
“We had a client in Virginia who lost $1.5 million in an investment fraud scam,” said Stephen Mead, a Senior Tax Consultant for JK Harris 165 Services. “He was so upset that he sank into a deep depression and felt like all was lost.”
Mead explained that his client did not file taxes from 1998-2003. Finally, the IRS caught up with the customer and wanted multiple years of back taxes, interest and penalties.
The customer went to JK Harris and Company, seeking tax resolution services. Upon investigating the case further, the tax resolution team determined not only did this customer have a solid case for the IRS’ Offer in Compromise, but that he would also be a good candidate for the 165 Services division.
“Once we got the case, it was obvious to us that we could help this client,” Mead said. “Using our in-house experts of fraud examiners and attorneys, we devised a plan to use the 165 deduction to not only solve his tax liability with the government, but to also put a substantial amount of money back in his pocket.
“In a nutshell,” Mead said, “it was a life-changing event for this man who thought he had lost everything.”
Key factors for 165 Services to consider are:
- Whether the loss is considered “theft” according to the state that the taxpayer resides;
- Whether the taxpayer was the target of the theft committed with criminal intent;
- What amount of the loss can reasonably be recovered; and
- When the theft was discovered.
The IRS will accept an Offer In Compromise (OIC) when it is unlikely that the tax liability can be collected in full and the amount offered reasonably reflects collection potential. The ultimate goal is a compromise that is in the best interest of the taxpayer and the IRS. Acceptance of an adequate offer will also result in creating, for the taxpayer, an expectation of a fresh start toward complying with all future filing and payment requirements.
The OIC process is based on a debt-to-asset formula devised by the IRS.
JK Harris can provide customers to discuss their particular experience with the Offer in Compromise program and 165 Services.