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July 26, 2013


Change of address notification crucial when dealing with IRS

In our last post, we talked about the impact taxes can have on a family business. In most cases, family members want the best for each other; and that can be difficult in a business setting. But the one thing no one wants for their business (may family be involved or not) is the Internal Revenue Service taking action against it.

When the IRS investigates a business — potentially culminating in formal punitive action — the owners can put together their own case by contacting an experienced tax attorney and beginning the clerical process necessary for whatever action is being brought against them. In many cases, you can challenge or appeal the IRS’s action. Even if that fails, you could reach an agreement with the IRS to help alleviate the situation.

One thing to remember, though, is that if your business moves, you should notify the IRS immediately. A business can ensure this happens by filing a special document called Form-8822B with the IRS.

Any change of address could result in a tax nightmare for the business if it is not properly documented. For example, you could miss out on a crucial piece of mail; and, lacking the information it contains, you would be ill-prepared or unable to deal with your tax situation.

This scenario just occurred after someone moved. The individual had a P.O. box, which was listed as the primary address with the IRS. But he soon gave up his P.O. box and switched his primary address to his current place of residence. More than a year elapsed between the official switch of addresses. During this time, the IRS sent tax notifications to the man — and he never got them. A tax lien was placed on his name; and despite the man’s legal challenges, the courts upheld the lien.

Source: Business Management Daily, “Moving? Remember to tell IRS,” July 18, 2013