Have them try to answer the following questions that an experienced licensed tax professional should know the answers to:
1. Does filing a return to replace a Substitute of Return (a return the IRS files for you) change the Collection Statute Expiration date? ANSWER: It doesn't change the Statute. Taxes will expire based on the original assessment.
2. Does getting your case placed into Uncollectible Status stop the clock on the Collection Statute Expiration date? ANSWER: No, it does not. Statute clock will keep ticking.
3. Are 1040 taxes dischargeable in Bankruptcy? ANSWER: Yes, they are -- see a Bankruptcy Attorney -- but generally they need to be three years or older and have been returns that the taxpayer filed at least two years ago.
4. Civil penalty or trust fund recovery rules affect the owners of corporation. In other words, if a company closes, officers of the corporation might be liable for the unpaid payroll taxes. How are LLC's and their officers affected by unpaid payroll taxes? ANSWER: Assessment rules changed for LLC's recently. Before January 2009, an LLC that owed payroll taxes would potentially have the owners fully liable for payroll taxes, just like sole proprietorships. After 2009, the taxes are assessed like corporations -- just the trust fund portion of the tax could be assessed against the liable owners.
5. Will the IRS take your refunds in the future if you are awarded an Offer in Compromise on your back taxes? ANSWER: They will take your refund only in the year of acceptance. For example, a 2011 accepted Offer would nullify the refund due on April 15, 2012.
If you are shopping for a tax professional, run these questions by them. Not many will pass the test.
