Trucking & Taxes – May 2025
You may have heard the rumors that President Donald Trump plans to abolish the Internal Revenue Service.
Well, not yet.
The truth is that Rep. Earl “Buddy” Carter, R-Ga., recently introduced the Fair Tax Act, which would replace the current tax code with a national consumption tax. The bill would abolish the IRS and repeal all personal and corporate income taxes, death taxes, gift taxes and payroll taxes.
As you can imagine, it would be a huge undertaking to dismantle the entire tax system and replace it with a single national sales tax. This new system would require a sales tax rate of 23%, which many sources suggest would increase to 30% – meaning that every dollar spent would come with an additional expense of 30 cents in sales tax.
This effort to change the tax structure is nothing new. It has been proposed before, and as always, it would take a lot to get it through Congress.
For now, you still will have to deal with the IRS if you owe money or are audited. And if you owe money, you need to act. The good news is there is a solution that does not require giving up all of your wages, filling out an endless amount of complicated forms or spending hours on hold with multiple IRS employees. Whether for business or personal debt, I recommend following the three simple steps of what I call the “IRS Playbook.”
Step 1: Tax analysis
To fully identify the problem, you must understand the root cause. It could be just an IRS issue that can be fixed by making a simple correction or addressing an audit. Getting to the bottom of the issue will require doing an in-depth analysis of your taxes using a full tax transcript from the IRS, which will detail the following:
- What years need to be filed
- What has been filed
- The tax debt per year
- The statute of limitations on collections
- Letters sent by the IRS
- All collection statuses
You need to do a close inspection of under- or over-reported income items that may be missing, as well as possible amendments needed. Amendments may be crucial for stopping possible IRS audits or adverse collection action.
Step 2: Put a hold on IRS collections
Once you’ve completed a full tax analysis, contact the IRS to put a hold on its collections. This keeps it at bay and gives you breathing room.
With that said, be careful about trying to go at it alone against the IRS – which will require information from you such as your income, the balances in your bank accounts and where you bank. A wrong answer may land you in hot water and make you subject to quicker bank levies, especially if you miss deadlines set by the IRS and your hold runs out.
Step 3: Structure a plan
Tax forms are varied, complicated and also required by the IRS. That is why putting together a detailed plan is necessary to achieve success when dealing with audits and resolutions. It should be a top priority to get a plan in place that saves you from the overwhelming burden of IRS overreach and collections.
Whether you are requesting penalty abatements or are settling through an offer, a partial-pay installment agreement, a non-collectible or a full payment plan, a plan is key. It will bring peace of mind, allowing you to know that your finances are protected and that a solution to your tax problem is around the corner.
As long as the IRS is around, now is the time to take control of your finances and get your tax problems solved. Whether you think you can do it yourself or need help from Taxation Solutions Tax Relief, today is the day to start. LL