Latest news with #taxdebt
Yahoo
19-07-2025
- Business
- Yahoo
Legal Tax Defense Announces Expanded Services for Tax Debt Relief
Experienced Tax Attorneys Provide Tailored Support for Individuals and Businesses Facing IRS Challenges Legal Tax Defense, Inc. Logo LOS ANGELES, July 19, 2025 (GLOBE NEWSWIRE) -- Legal Tax Defense, Inc., a trusted name in tax law representation, announces the expansion of its services through the addition of new legal staff, updated client support systems, and specialized offerings addressing ERC audits, and multi-state tax issues. With a team of seasoned tax attorneys and enrolled agents, Legal Tax Defense continues to offer personalized tax debt relief solutions designed to protect clients from aggressive collection actions and financial strain. In recent years, an increasing number of Americans have faced mounting tax debt as a result of economic disruptions and evolving IRS enforcement measures. Legal Tax Defense has responded by hiring additional legal professionals and client service specialists, reducing wait times for initial consultations. The firm also launched a new secure client portal to streamline document submissions and communications, and expanded its availability to include evening and weekend appointments. 'Tax debt can create long-term financial distress for families and business owners alike,' said a spokesperson for Legal Tax Defense. 'Our mission is to offer clear, honest legal representation so that taxpayers understand their rights and are not left navigating the IRS alone.' Legal Tax Defense provides comprehensive legal services that include Offers in Compromise, installment agreements, penalty abatement requests, and audit defense. Clients receive support from licensed professionals who are well-versed in federal and state tax laws, ensuring compliance while pursuing the most favorable outcomes. As part of the expanded services, the firm now offers tailored solutions for emerging tax concerns, including Employee Retention Credit (ERC) audit defense, and support for remote workers facing multi-state filing obligations. These additions reflect the evolving landscape of tax enforcement and the firm's commitment to staying ahead of regulatory changes. All case evaluations begin with a detailed review of each client's financial circumstances to determine the most appropriate path toward resolution. The firm operates with a commitment to confidentiality, transparency, and clear communication throughout the process. With its expanded focus, Legal Tax Defense aims to reach more individuals and businesses across the United States who are in need of reliable tax debt relief. The firm also offers educational resources on its website, helping taxpayers understand their options and avoid common pitfalls when dealing with the IRS. Legal Tax Defense is headquartered in Los Angeles and serves clients nationwide through virtual consultations and secure document handling systems. For more information or to schedule a consultation, visit About Legal Tax Defense, Inc. Legal Tax Defense, Inc. is a Los Angeles-based tax law firm dedicated to helping individuals and businesses resolve complex tax issues with the IRS and state tax agencies. With a team of experienced tax attorneys, enrolled agents, and case specialists, the firm provides comprehensive services including tax debt relief, audit representation, Offers in Compromise, and installment agreements. Legal Tax Defense is committed to transparency, ethical advocacy, and personalized legal strategies that protect clients' financial futures. The firm serves clients nationwide through secure virtual consultations. To learn more, visit This press release is intended for informational purposes only. Tax laws vary by jurisdiction, and individuals are advised to consult a licensed tax attorney or professional regarding their specific situation. Media Contact:Sharon Goldstein-ShapiroLegal Tax Defense, Inc.800-804-2769sharon@ A photo accompanying this announcement is available at in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
News.com.au
15-07-2025
- Business
- News.com.au
‘Never that high': Why so many Aussies have a tax debt this year
If you are one of the Aussies who has copped a bill after lodging their tax return this year, then you are not alone, with an accountant revealing she has witnessed a significant rise in the number of debts being issued. We are now half way through July and the number of people taking to social media after being told they owe money to the Australian Taxation Office (ATO) has been steadily rising. The tone of their posts range from disappointed to outright furious, but it is clear a significant number of Australians are really unhappy this tax time. Tax Invest Accounting director and tax agent Belinda Raso told she has seen an explosion in people being hit with tax debts, with numbers rising since the end of the low and middle income offset in 2022. Previously, Ms Raso said, people who received a tax bill predominantly knew they were going to be getting one. For example, people who forgot to tell their employer about their HECS-HELP loan, claimed the tax free threshold twice, people with side hustles or those with a positively geared investment property, would be unsurprised by the arrival of a tax bill. But now plenty of unsuspecting Aussies are being hit with unexpected debt. 'Since 2023, I'm not exaggerating, I'm looking at 20 to 30 per cent of clients that are ending up with the tax debt. It was never that high,' the tax agent said. Ms Raso shares a lot of content on social media around tax time and has this year been inundated with messages from people who have no idea why they have received a tax debt. On TikTok alone she says she can get about 20 messages a day from people who owe the ATO money. 'I could be speaking to 30 or 40 people daily that are not even clients, that are begging for help,' she said, adding that she always works to help these people as much as she can. 'It is so prevalent and it's just ordinary Aussies that are employees, and they're wondering, 'Why the hell? What's going on?'' Looking at the comments on some of Ms Raso's videos, you can see just how many people are struggling with tax bills this year. 'My estimate says a $1.9k debt. Can't work out for the life of me why, there's no way I can pay that,' one person said. Another commenter said they got a $1500 bill despite having the same job as previous years where they received refunds. 'Nothing has changed. I made a bit more money this year worked more. But how do I get $1000 returned last year, and now I owe $1500?' they asked. Another said: 'I have two jobs only claim tax free threshold on one and now I owe $1800!' A quick scroll on TikTok will also show dozens of videos of young people expressing lament after their dreams of a healthy tax refund were dashed. One user, Kenneth, said he spent 'five hours, 47 tabs, three breakdowns doing (my) tax return, just to find out I owe $4000 to the ATO'. In the caption of the video he added: 'The only return I got was emotional damage.' Another young worker shared an image showing she owed almost $5800 to the ATO, asking 'wtf is this' and 'no one speak to me'. A nurse made a video revealing his $3404 debt, while another TikToker, Elaya, was hit with a $1733 bill. Another user revealed they owed close to $9000, writing, 'Any accountants wanna help me?' Ms Raso said there are a few main reasons people are copping debts this year, with one of the key culprits being the rise in people taking on multiple jobs. Australian residents are entitled to the tax-free threshold, which means you pay no tax on the first $18,200 of your income. However, it can only be claimed for one job, and for any additional jobs Aussies must inform their employer they will not be claiming the threshold. But the accountant warned that for people with multiple jobs, this is often not enough to avoid being hit with a tax bill at the end of the financial year. 'If your main job is earning $45,000 or more per year, when you tell that employer at your second job that you don't want to claim the tax free threshold, you go to that first tax rate, which is sitting at 16 per cent plus Medicare levy, that automatically defaults to that,' Ms Raso explained. 'So the employee has done the right thing, the employer has done the right thing, but if you're earning $45,000 or above in that main job, you're already sitting at 30 per cent tax rate, plus 2 per cent Medicare levy, so straight up, you've got a 14 per cent difference.' Ms Raso said this hasn't been as significant an issue previously, because fewer people were working multiple jobs and there was the buffer of the low and middle income tax offset. The tax agent sees thousands of people a year and says she is having conversations on this subject almost every day. She said it is 'distressing' when people are having to get second or third jobs just to get by and they think they are doing the right thing in terms of their tax, only to be hit with a bill. 'No one's done anything wrong, but there is no option for them to actually get that extra tax withheld,' Ms Raso said. 'For most people, our tax system is complicated enough. If they have to go and manually work out another 14 or 15 per cent, that's unfair.' Another common issue has to do with HECS-HELP debt. The repayment income threshold is currently sitting at $56,156, meaning you'll only start seeing payments come out of your pay if your salary ticks over that amount. But, if you are earning under the threshold for both jobs, then neither employer will be withholding those repayments. However, the ATO looks at your total taxable income, so if your combined income is above the threshold and you haven't been making repayments, you are going to be hit with a debt. Another situation Ms Raso sees revolves around salary sacrifice, novated leasing and reportable fringe benefits. She said many people don't realise that those reportable fringe benefits get grossed up by 1.88 times, which is going to impact how your HECS-HELP repayments are calculated, with them being repaid at a higher rate. Ms Raso said those are the three main reasons for tax bills she sees every year, and warned people who cop a debt this year are likely to find themselves in the same situation next year, unless they figure out why. 'If it's not addressed, the same thing is going to happen next year. And if you're one of the people that go may not have had a tax debt this year, but have gotten a second job, you'll end up in that situation next year,' she said.
Reuters
11-07-2025
- Business
- Reuters
Brazil to collect $1.8 billion from debt renegotiation with big companies
BRASILIA, July 11 (Reuters) - The Brazilian government secured 10.2 billion reais ($1.8 billion) in revenue from the first round of tax debt renegotiations with major companies this year, the Treasury's attorney general and the Federal Revenue Service said. As part of the initiative, which is included in a broader effort to reduce Brazil's fiscal deficit to zero by 2025, the government is finalizing technical details to launch another three public notices to renegotiate tax debts, Treasury Attorney General Anelize Almeida told Reuters. The first-round agreements include an immediate collection of 7.6 billion reais and future payments of 2.6 billion reais. These kinds of tax debt transactions were originally created to grant discounts on debt renegotiation for companies in serious financial situations. They were made more flexible by a 2024 regulation that allowed the government to seek agreement with large companies to avoid costly and potentially unsuccessful court actions. "We're moving to a new focus of the transaction, which is the legal criteria and the litigation involved, how much it costs to maintain the litigation," Almeida said. "The economic cost of this litigation is very significant for the government and for the company." The first round primarily involved large banks. Companies agreed to drop judicial and administrative challenges, concluding 188 lawsuits.
Associated Press
11-07-2025
- Business
- Associated Press
Filing Separately Could Cost You More on Back Taxes - Clear Start Tax Explains Smarter Options for Married Couples
Clear Start Tax shows married couples how to avoid costly filing mistakes and save more when back taxes are involved. IRVINE, CA / ACCESS Newswire / July 11, 2025 / Married taxpayers dealing with back taxes are often surprised to learn that filing separately to 'protect' one spouse from IRS collections can actually lead to higher tax bills, lost credits, and fewer resolution options. According to Clear Start Tax, understanding the pros and cons of married filing jointly vs. separately is critical for couples hoping to resolve tax debt while preserving as much income as possible. 'Filing separately might feel safer when one spouse has IRS issues - but it usually ends up being more expensive,' said the Head of Client Solutions at Clear Start Tax. 'In many cases, joint filing opens the door to relief programs, better deductions, and faster resolution.' Why Filing Separately Can Backfire for Couples With Tax Debt Some couples assume that filing separately shields one spouse's income or refunds from being seized. While separate filing may delay IRS collection on a refund, it doesn't always protect shared income or assets, especially in community property states. And in many cases, filing separately ultimately results in: How Filing Together Could Be the Smartest Move for Tax Relief Even when one spouse owes back taxes, joint filing can result in lower taxes and greater access to IRS relief programs. Clear Start Tax helps couples explore the advantages of working together, not separately. For situations where only one spouse is responsible for the debt, programs like Innocent Spouse Relief or Injured Spouse Allocation may protect the non-liable spouse, without sacrificing the benefits of joint filing. 'The IRS gives couples a way to protect the innocent spouse while still getting the best outcome,' said the Head of Client Solutions. 'We help clients understand their rights and design a strategy that keeps more money in their household.' The Fresh Start Program Can Help Couples Settle Tax Debt Together This IRS initiative allows struggling taxpayers - including married couples - to settle or restructure their tax debt based on what they can reasonably afford. Clear Start Tax walks couples through every step of the process. By answering a few simple questions, taxpayers can find out if they're eligible for the IRS Fresh Start Program and take the first step toward resolving their tax debt. Joint Returns Come With Risk - But Also With Options While joint returns mean both spouses are legally responsible for the full tax bill, Clear Start Tax helps clients explore: These strategies can balance legal responsibility while still maximizing the couple's chances of saving money and moving forward. About Clear Start Tax Clear Start Tax is a full-service tax liability resolution firm that serves taxpayers throughout the United States. The company specializes in assisting individuals and businesses with a wide range of IRS and state tax issues, including back taxes, wage garnishment relief, IRS appeals, and offers in compromise. Clear Start Tax helps taxpayers apply for the IRS Fresh Start Program, providing expert guidance in tax resolution. Fully accredited and A+ rated by the Better Business Bureau, the firm's unique approach and commitment to long-term client success distinguish it as a leader in the tax resolution industry. Need Help With Back Taxes? Click the link below: (888) 710-3533 Contact Information Clear Start Tax Corporate Communications Department [email protected] (949) 535-1627 SOURCE: Clear Start Tax press release
ABC News
10-07-2025
- Business
- ABC News
Restaurants and pubs are legally wiping debt to stay afloat
Neville Walton wasn't expecting forgiveness from the Australian Tax Office. Then the publican discovered a legal way that he could wipe a massive chunk of his historic hotel's unpaid $350,000 tax bill, and keep himself pulling beers behind the bar. "I'm sure [anybody would] jump at that opportunity," Mr Walton says. Mr Walton's story highlights a growing trend in Australia, where more small business owners are using a relatively new provision under the Corporations Act to claw their way out of business debt and keep trading. The corporate regulator says there is no evidence so far that small business restructuring (SBR) laws are facilitating bad business practices, yet some still have reservations over the scheme's implications. The Albany Hotel is believed to be Western Australia's oldest pub, having served liquor for 200 years. Mr Walton took over the lease in 2017, as part of a pre-retirement dream. "Something I thought I'd take on when I turned 60 was to buy a pub," he says. Mr Walton says business was good at first, but then patrons dropped off during the pandemic, and overheads like electricity, wages and even beer shot up in price. Paying the tax bills, like GST, came last. "Of course, [the tax debt] blew out of proportion," he says. "We went on a payment plan (with the ATO) and we were going along great with that for a while, and then that got harder and harder as well." The situation was so stressful for Mr Walton, that he says he was contemplating declaring business failure or using his superannuation to repay the debt. "I was barely keeping my head above water," he says. Mr Walton didn't know about small business restructuring (SBR), until his bookkeeper told him about this law and referred him to an adviser last year. SBRs were brought into play in 2021, as part of the-then Morrison government's response to help mum and dad traders caught up in the pandemic downturn. The process is billed as an alternative to liquidation, which is where an insolvent company is wound up and its creditors — entities owed cash by the business — are paid back whatever is possible out of sold off assets, sometimes next to nothing. Under the Corporations Act, SBRs legally allow a small business to instead ask their creditors to wipe or reduce debts, while still keeping the business going. The business can only ask to do this if the debts are below $1 million, and none of it can be money owed to staff, like superannuation or wages. Like with a company liquidation, creditors need to go to a vote for an SBR to go ahead, explains Kate O'Rourke, a commissioner at the corporate watchdog, ASIC. Creditors get a voting sway based on how much debt they are owed, which means an entity with 51 per cent of the total debt will determine the outcome, she adds. "The idea [behind an SBR] is to give small businesses a more cost effective, faster and hopefully successful way of getting through financial difficulty and coming out the other side," she says. "The alternative liquidation, where the company just gets wrapped up under as a liquidated company and does not trade anymore, may give (creditors) even fewer cents in the dollar." After an initially slow uptake, fresh ASIC data shows the number of SBRs soared exponentially in the last financial year, with around 3,000 put forward to creditors. ASIC's Ms O'Rourke says this rise in uptake is likely because awareness about SBRs has been generally growing, but also because many small businesses are facing tough trading conditions right now. This stress is especially acute in the food and beverage sector, with almost one-in-10 of this sector's businesses winding up in the last year, data from monitoring firm CreditorWatch shows. The sector's insolvency rates, which have always been above average, are also at historic highs at up near 3 per cent, data shows. Construction comes next at half that rate. "Any industry that is exposed to consumer spend is still doing it really tough," CreditorWatch's chief executive Patrick Coghlan says, noting ongoing economic pressures such as big cost increases and higher interest rates. ASIC's data shows the most common type of business lodging an SBR is in construction, followed closely by those in accommodation and hospitality, all together making up 50 per cent of all lodged. Most SBRs are involving between $200,000 to $400,000 in debt, with most plans asking creditors to wipe around 80 per cent of that ledger. And most SBRs are being approved, with an acceptance rate of around 80 per cent. Overwhelmingly, it's tax debt being wiped, with ASIC data showing the ATO a party in 93 per cent of all SBRs lodged. The tax office further confirmed it has been involved in 2,500 approved ones. "The ATO has supported most restructuring plans where the ATO has been a creditor, voting in favour of around 80 per cent of them for the 2024-25 financial year as of March 2025," a tax office spokesperson said. It is unclear why the ATO is involved in so many SBRs, however several commentators have noted that the tax office is currently initiating a so-called "clawback" of business debt racked up during the pandemic. "We really are in a high debt recovery zone with the ATO," says Jarvis Archer, a restructuring agent that lodges SBRs for small business clients nationally. He is finding the ATO is "mostly the largest, if not the only creditor, in a small business restructure". ASIC's public data is limited on this issue. It doesn't show vote rates, with it unclear if big wig creditors like the ATO are routinely overriding the no vote of smaller lenders or creditors, like suppliers to restaurants or building companies. Have you been a creditor in an SBR? Did you vote yes or no? Email our journalist confidentially on or Mr Archer's firm Business Reset was involved in the Albany Hotel's restructure, which the restructuring agent says illustrates how they are carried out behind the scenes. The pub's restructuring plan was put to the ATO in early 2025, and included evidence that the pub had returned to profitability, by doing things like cutting staff hours and even axing its Foxtel subscription. "We could propose a restructuring proposal to the ATO showing that there were limited concerns for the future viability for the business," Mr Archer says. The pitch involved paying the tax office back just $76,000 of the $350,000 it was owed, plus an extra $15,000 fee to Business Reset, ASIC documents show. In practice, this worked out to just 22 cents to each dollar owed by the pub. The reduced debt is being paid back in monthly instalments, and will shoot up back to the original sum owed if the Albany Hotel defaults. Mr Walton describes this outcome as "fantastic". "I never expected (the debt) to be wiped, to be honest," he says. "Our debts were probably pretty minuscule when you think about the millions of dollars that's probably outstanding to the tax department. "Hopefully in 18 months time, I can come out of it debt free. And although I won't have anything to sell with the business, I'll be able to sleep at night. Six months later, the Albany Hotel survives. Around 93 per cent of small businesses that went through an SBR are still registered one year later, which ASIC commissioner Kate O'Rourke says highlights "some success" from the scheme. Yet it's unclear how many small businesses that wipe debts continue trading years later, or how many have just gone on to rack up debts again or even go belly up. Just this year, a prominent Melbourne bakery chain collapsed, owing its staff $368,000 in unpaid entitlements and the ATO an even larger sum of $1.2 million. ASIC documents show All Are Welcome went through a restructure only three years ago, which wiped a debt of $585,000 by more than 80 per cent. A large chunk of this was to the ATO. The bakery's owner Boris Portnoy told ABC News that the smaller debt agreed on through the restructure was paid back up-front back in 2022. He declined an in-depth interview. "Small business restructuring might be good for some businesses, but for the bakery that needed to grow to survive, perhaps a low interest loan might have been more helpful," he said in a statement. Both the ATO and a smaller lender that was involved in All Are Welcome's restructure declined to comment. The ATO also declined to speak about the Albany Hotel. The ATO also would not reveal how much tax debt it has formally wiped through SBRs. Almost $90 million has been paid out to the tax office after it accepted restructures, ASIC's report found. This hints at a total comparable amount forgiven by the ATO of at least $500 million. "The ATO will generally support a restructuring plan if it's commercially appropriate," the ATO spokesperson said. "And it would be objectively fair and reasonable considering the company's compliance history and the conduct of the directors. If the plan does not succeed, the business remains liable for the original debt. ASIC's report notes concerns that SBRs are facilitating the illegal practice known as phoenixing, where a company collapses and then rises from the ashes elsewhere without debt. ASIC found there's no evidence yet that SBRs are being flouted or misused. However, some in the insolvency industry still have their reservations. "There's definitely positive and negatives about the SBR regime," CreditorWatch's Patrick Coghlan says. "They're helping businesses that probably have a future go through a more streamlined restructuring process and come out the other side with a cleaner balance sheet," he says. "I think also that there's some downside there, where (SBRs) can be utilised to avoid paying debts. "You know, if you're paying 10 cents in the dollar on your debts to continue trading, that's not necessarily a sustainable model for most creditors." Commissioner Kate O'Rourke says there are safeguards in the law, including that a business can't go through an SBR if any director has been involved in liquidation or restructure in the last seven years. "There's no guarantee that a company or any of these companies are going to always be successful afterwards," she says. "So ASIC will continue to look at that level of registration in the periods of time after companies use this SBR, and we'll explore whether there are other data points that we can continue to track. "We think overall, there's benefits both for creditors and the companies themselves."
