Illinois tax lawyer, Illinois bankruptcy lawyerTelephone scams are an increasingly common problem in Illinois. Scammers employ persuasive tactics and advanced techniques that can ensnare even the savviest consumers, and if you are dealing with debts and IRS issues, you are even more likely to be susceptible. The following highlights three types of the latest scams currently wreaking havoc, and how you can avoid being a victim.

1. Credit Collection Scams

The Consumer Financial Protection Bureau warns against scammers posing as debt collection companies, who may attempt to solicit payments or personal information from you for the purpose of accessing your accounts or stealing your identity. These fraudsters may disguise the number that appears on your caller I.D. in an attempt to fool you into believing they are legitimate. Warning signs that these calls are a scam include:

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debt collection agencies, Tinley Park bankruptcy attorney, creditor harassment, credit collection protection, debt solutionsThere are few things worse than dealing with constant harassment from debt collection agencies. In their quest to secure payment for companies who hire them, they will often resort to unsavory or even illegal practices, such as calling you at all hours or making threats. When dealing with these companies, it is important to be aware of your rights. As these calls will generally only increase in frequency, you also need to know the steps you can take to address the situation.

Harassment from Creditors

When you fall behind and fail to make payments on loans and credit cards, creditors do have the right to contact you in order to collect on the debt. They often contract out with debt collection agencies, who earn a percentage on any outstanding balances that are paid.

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IRS issues, Tinley Park tax lawyers, debt collection, delinquent tax debts, tax lienIf you owe money as the result of IRS issues such as failing to pay your taxes, having past tax debts, or having years of un-filed tax returns, it is vitally important to pay close attention to any notices you receive. The IRS will generally warn you before taking collection actions, providing you the opportunity to address the situation, either by paying your debt or making payment arrangements, and to dispute the amount owed.

IRS Debt Collection Actions

The IRS is required by law to provide written notice of any collection actions they intend to take, and to allow you time to settle the debt. Failing to respond to these notices, which are an important part of the IRS collection process, could result in the following actions.

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Tinley Park bankruptcy attorneys, credit rating, filing for bankruptcy, bankruptcy and your credit, discharging debtsIf you are struggling with an excessive amount of debt and considering filing a personal bankruptcy, one of your biggest concerns is likely to be the potential impact on your credit rating. While you may have heard stories about how bankruptcy ruins your credit rating and remains as a bad mark on your credit report for 10 years, the truth about the actual impact of bankruptcy on your credit may surprise you.

Bankruptcy and Your Credit

As bankruptcy involves discharging debts and offering creditors less than the actual amount owed, this obviously does not earn you good marks in terms of your credit rating. At the same time, dealing with the issue head on is preferable to struggling with missed or late payments and creditor collection calls over the course of several years.

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Cook County bankruptcy attorneys, protect personal property, file for bankruptcy, Illinois bankruptcy, Illinois bankruptcy exemptionsWhen filing for bankruptcy in Illinois, there are certain types and amounts of property or assets that can be protected against creditor claims. Homes, household goods, personal belongings, and financials accounts may all fall under state and federal exemption limits, allowing you to retain possession of these items in a Chapter 7 bankruptcy liquidation, and impacting repayment calculations in a Chapter 13 reorganization.

How Exemptions Apply to Bankruptcy in Illinois

Exemptions protect personal property and assets you own, so that they are not subject to creditor claims during bankruptcy proceedings. Rather than applying the rules on bankruptcy exemptions listed under Chapter 5 of the U.S. Bankruptcy Code, Illinois enacted legislation to ‘opt out’ of this system, instead relying on its own state laws in these matters. The type and amount of exemptions you are entitled to claim depends on the type of bankruptcy you file:

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Chapter 13 bankruptcy, financial stability, Cook County bankruptcy attorney, file for bankruptcy, avoid foreclosureFiling for bankruptcy is never an easy decision to make. Still, bankruptcy is often an effective way to enter a debt-free life. Chapter 13 bankruptcy, in particular, can offer a clear and direct path that encourages responsible financial decisions.

Deciding to file for Chapter 13 bankruptcy is a significant decision—one that could have an effect on you and your family for several years down the road. Therefore, this decision should not be made without skilled financial and legal guidance.

Before filing any type of bankruptcy, it is important to learn as much as possible about the process.

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Cook County tax law attorney, small tax errors, IRS issues, business tax mistakes, reporting taxesAs a business owner, you have your hands full from the get-go. Regardless of how much help you have behind the scenes, ensuring things run smoothly and efficiently is an ongoing challenge. From recruiting and hiring employees to payroll and marketing efforts, you are responsible for the overall operation and success of your business, and this includes managing the finances and properly reporting taxes to the IRS.

Tax Mistakes That Can Hurt

When it is time to report your company’s earnings and expenses to the IRS, it is crucial to make sure you have all financial affairs in order, otherwise you run the risk of landing yourself—and your entire company—in hot water with the IRS. Consider the following examples of small tax errors that can mean big consequences for your business.

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IRS issues, Cook County IRS issues lawyer, record-keeping, tax records, small business taxesWhether your business is large or small, properly managing your company’s money is crucial when it comes to making and maintaining a profit. Solid financial record-keeping is a must in order to ensure a successful operation, and it is often the factor that helps business owners avoid IRS issues when tax season rolls around. All it takes is a few minor missteps—or one major one —for your business to end up with hefty fines and other damaging penalties due to poor tax practices.

The Power of Accurate Record-keeping

In general, good record-keeping is a valuable tool for sole proprietors, partners, and corporations alike. It allows you to do a number of things for your business, including monitoring overall progress, keeping track of deductible expenses, identifying income sources, and much more.

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Cook County bankruptcy lawyer, loan modificationFalling behind on one debt can cause a cascading effect on other debts. Credit card bills, school loans, and mortgages are some of the most common reasons why people to fall behind on their financial obligations. Debt can quickly get out of hand leaving some confused, desperate, and vulnerable.

Is Bankruptcy My Only Option?

There are ways where one can avoid filing a bankruptcy or ways to use bankruptcy in tandem with other debt relief measures.

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Cook County IRS issues lawyer, past due tax returnsSmall or large business owners and self-employed individuals alike run the risk of losing out significantly when neglecting to file past due tax returns. Failing to file your taxes in general, even when they are already overdue, can cause excessive IRS issues that end up following you long term.

While many people delay filing their taxes or choose to not file them at all with the goal to save money, the idea often backfires. The consequences pile up quickly when the IRS hits them with penalties and interest charges for failure to file and pay the balance owed.

The Negative Impact of Neglecting Your Tax Returns

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Cook County IRS issues lawyer, IRS installment agreementWhether you are an incorporated business owner or a self-employed individual, you likely work to avoid any and all IRS issues as you manage your ongoing tax-payment responsibilities. Tax mistakes with the IRS can result in countless costly scenarios, including fees and penalties, and in extreme cases, jail time. Dodging troubles with taxes requires constant, attentive maintenance, however. Being proactive in your approach to filing and paying correctly is often your best bet, especially when your finances—and maybe even your reputation—are at stake.

Using Installment Agreements as a Preventative Measure

An installment agreement is something offered to us by the IRS when we are unable to pay the entire lump sum we owe immediately. It is a helpful tool that allows us to pay the balance in pieces, over time, while still upholding our tax obligation. It may not be available to everyone, and certain requirements do apply; however, an installment agreement can be a nice option to take advantage of when you are at risk of being fined for failing to pay your balance correctly or on time.

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Tinley Park bankruptcy lawyer, creditor harassmentWhen you file for bankruptcy, you are granted a stay on most of your debts. Essentially, this means your creditors cannot contact you or attempt to collect the debt. What happens, though, if the creditor keeps calling and harassing you through the mail, at your work, or at your home? Rest assured: you can enforce the protections that bankruptcy offers.

When Contact is a Genuine Oversight

All creditors know (or should know) that a bankruptcy filing means they must cease all contact with the debtor. As such, most who violate this rule have simply experienced an oversight. Perhaps they did not remove your name from the system properly, or have not received the paperwork yet that notifies them of your filing. In any case, it is important that you not panic during the initial contact from a creditor. Instead, simply inform them that you have filed for bankruptcy and politely refer them to your attorney.

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Tinley Park bankruptcy attorney, small business bankruptcyWhen starting up a business, it is recommended that you plan to have at least five years of savings to support your business without profiting by a single dime, and if you can make it past the five years, your business has a higher potential for long-term success. The truth is, any company can experience financial turmoil at any point, be it two days or two centuries into service. The industry for which your company operates may fluctuate, or an unforeseen public catastrophe may drive business away. At what point do you decide to file for bankruptcy?

Small Business Bankruptcy

In some cases, but not all, you may be eligible to continue your business operation after filing for bankruptcy. Bankruptcy is an option when a company has accumulated more debt than the profit it is bringing in, with no hope of catching up. There are two options for small businesses which become a decision based on the future goals of the operation. If you would like to try to remain in business but need help with the accumulating debt, Chapter 11 bankruptcy may be an option where debts reorganize. If quietly closing the doors on this business and this part of your life is the best avenue, Chapter 7 may be the better option.

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Tinley Park small business IRS defense attorney, tax filing blundersTax season has come to an end, yet many small businesses have filed for extensions. That means there are still companies at risk for potential issues with the IRS. How can you avoid them? You can start by being aware of the most common tax filing blunders made by small businesses.

Attempting to Hide Income

It can be tempting to reduce your tax bill by hiding cash transactions. However, the IRS knows that small businesses and sole proprietors are far more likely to hide money than corporations and employed tax payers. As such, the IRS scrutinizes these at-risk businesses closely.

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Cook County tax law attorney, common tax deductionNo matter the time of the year, it never hurts to start sifting through your drawers and records for potential tax breaks you may be eligible for when the next tax season rolls around.

Like all tax planning, searching for possible deductions for your IRS tax returns is best done early on, for multiple reasons. For one, you can save yourself from racing around at the last minute to collect the information, and two, you can get a jumpstart on running the numbers by your accountant to ensure you have covered all your bases. Additionally, you can catch errors before you file. 

While getting a head start on your deduction claims is helpful, it can be detrimental when you have not done your homework and you miss those errors. Intentionally claiming the wrong deductions or reporting them incorrectly can land you in hot water if you are not careful.

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Cook County IRS issues lawyer, quarterly tax paymentsWhen it comes to taking care of obligatory tax balances each year, it is not uncommon for self-employed individuals and business owners to run into trouble with IRS issues whenever tax season rolls around.

Depending on the circumstances surrounding your income, if you fall under one of these categories, you are likely required by the IRS to pay estimated taxes, or quarterly tax payments. This is necessary to report—and pay—for your taxes as you receive your earnings throughout the year. For many, making estimated tax payments to the IRS can feel costly and burdensome. However, when properly prepared for, quarterly payments can work to your advantage.

What You Gain from Paying Quarterlies

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Tinley Park bankruptcy attorney, personal debtsThe United States is a notoriously consumeristic society. Having good credit is a necessity to buy a home and a reliable vehicle. Credit must be built, often through the usage of credit cards and the ability to repay the credit card debt.

Sometimes we accumulate debt and get in too far over our head. Other times, a major unforeseen life event occurs, one we are unprepared to handle financially. When this happens, there is a process known as bankruptcy to help struggling individuals and families. When considering bankruptcy, the first question on many minds is, “will it get rid of all of my debt?"

What is Bankruptcy?

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Cook County tax law attorney, unreported tips, businesses filing taxesThe service industry creates a significant portion of the United States economy. One estimation from 2012 indicated the economy as divided into 79.7 percent employed in the service industry, 19.2 percent employed the manufacturing sector, and 1.1 percent were employed in agriculture. Much of the service sector consists of tipped positions, such as a food server or a hair stylist.

Many owners of businesses offering professional services understand it is their responsibility to report and pay taxes on tips reported to them by their employees. There is also an amount of tips left unreported by employees. The business owner must also declare the income with social security and Medicare taxes.

Employee Responsibility

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Tinley Park bankruptcy lawyers, personal bankruptcyThe decision to file for bankruptcy is not one easily made. Moreover, the days, weeks, and months following the decision can also be difficult. There may be feelings of fear or concern. Then there is still the stress of preparing for the bankruptcy process. The following may be able to help alleviate some of that stress, and provides guidance on how to find the assistance you need.

Start by Contacting an Attorney

While there are many steps to take during the bankruptcy process, your first should be to contact an experienced bankruptcy lawyer. Not only will this help you prevent missteps during the bankruptcy process, it can expedite the next steps. A skilled bankruptcy lawyer can get you on your way to less stress from the creditor calls and collection letters.

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Cook County IRS issues lawyer, estimated taxesAs an individual or business owner, the Internal Revenue Service (IRS) requires that you pay taxes as you receive your income throughout the year. This happens in one of two ways: Via withholding from your employer, or through estimated tax payments.

Failing to pay taxes or paying them incorrectly can easily cause you to experience IRS issues that have the potential to follow you for months, maybe even years. This is why it is so crucial to make sure you are not only paying your taxes, but that you are paying them properly and in the most efficient way possible for both you, and for the IRS.

The Purpose of Quarterly Payments

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