Delia Law P.C.

10/16/2026

October 15th has come and gone. You finally filed your 2025 tax return, breathed a sigh of relief, and thought you were done with taxes for a while.

Except there's one problem. You owe the IRS money you can't afford to pay.

Now what?

Unfortunately, filing the return doesn't make the balance disappear. The IRS will begin sending notices requesting payment, penalties and interest will continue to accrue, and eventually collection activity can follow. And one consequence taxpayers often don't think about is a federal tax lien.

A tax lien is the government's legal claim against your property. If the IRS files a public Notice of Federal Tax Lien, it can complicate selling or refinancing your home, obtaining financing, or conducting business transactions.

Here's what many taxpayers don't realize:

• The IRS doesn't automatically file a public lien notice just because you owe taxes.

• Getting into an installment agreement doesn't always prevent a lien.

• Even if a lien has been filed, there may be options to obtain a release, withdrawal, discharge or subordination.

We regularly represent taxpayers with substantial IRS liabilities, and one of the first things we evaluate is how to resolve the debt while protecting their financial interests.

Sometimes the right payment arrangement can help prevent a public lien filing. Other times, the taxpayer's assets, equity, financial circumstances and collection history require a different strategy. The important thing is understanding your options before an IRS collection problem becomes a property or financing problem.

We recently wrote about when the IRS files federal tax liens, how they affect taxpayers, and what can be done about them.

Read our article:

https://deliataxattorneys.com/irs-tax-liens-in-2026-when-the-irs-files-a-notice-of-federal-tax-lien-and-how-to-get-it-released/

IRS tax lien in 2026? Understand when they are filed, how they affect property, and options for release or withdrawal.

10/13/2026

House Rich, Cash Poor: When the IRS Wants Equity You Cannot Access

We're seeing this increasingly with higher-income taxpayers struggling with substantial IRS tax liabilities from the COVID and post-COVID years.

Consider this hypothetical situation:

You owe the IRS nearly $500,000. Your home appreciated significantly during the pandemic, leaving you with substantial equity. On paper, you have assets. But the financial reality looks very different.

You experienced a significant loss of income, took out loans to keep your household afloat, and watched your credit score decline. Now you're earning a substantial income again, but financially, you're starting over. Between housing expenses, family obligations, and accumulated loan payments, you're moving money around each month just to avoid defaulting.

Despite earning a substantial income, very little remains at the end of the month. And because of your credit history and existing debt, you cannot qualify for financing to access your home equity.

Yet the IRS sees the equity in your home.

An Offer in Compromise may not be viable because the IRS generally considers realizable equity when evaluating your ability to pay. An installment agreement may be possible, but the IRS does not necessarily recognize all of your actual monthly expenses, particularly payments on unsecured loans.

Depending on the taxpayers profession, the filing of a Notice of Federal Tax Lien may create employment, professional licensing, or security clearance concerns, potentially even resulting in job loss. And if the taxpayer loses the very income needed to repay the IRS, how is the tax debt supposed to be resolved?

So what is the solution? Sometimes there isn't an immediate one.

These cases often require a long-term IRS collection strategy while the taxpayer rebuilds financial stability. Options may include installment agreements, documenting the inability to access home equity, evaluating allowable expenses, addressing federal tax lien concerns, and reviewing collection statute expiration dates.

As household income stabilizes and debt decreases, resolution options may change.

A high income doesn't necessarily mean financial stability, and substantial home equity doesn't mean access to cash.

Some IRS collection cases require years of careful planning, negotiation, and strategic adjustments, rather than a rushed resolution without a well-thought-out, long-term strategy.

10/07/2026

The IRS is strengthening its international whistleblower efforts, and this is another sign of how much more connected cross-border tax enforcement is becoming.

The IRS announced that it worked with the United Kingdom’s tax authority, HMRC, to help develop its new Strengthened Reward Scheme, modeled in part on the expertise of the IRS Whistleblower Office.

The programs encourage people with specific and credible information about serious tax violations to come forward, potentially in exchange for a monetary award.

The types of conduct the IRS specifically identifies are significant:

• Undeclared foreign bank accounts and FBAR violations

• Assets hidden through foreign trusts, foundations, financial instruments or anonymous entities

• Money laundering

• Transfer pricing manipulation and improper cross-border profit shifting

What stands out to me us as a tax law firm is the increasing coordination between tax authorities.

Offshore accounts, foreign entities and cross-border transactions do not exist in isolation anymore. Information can come from financial institutions, foreign governments, information returns, whistleblowers and other sources.

That does not mean having a foreign account or foreign assets is improper. U.S. taxpayers can absolutely have them. The problems arise when required income, accounts, assets or entities are not properly reported.

We see taxpayers who discover years later that they had U.S. reporting obligations they did not understand. The first step is determining exactly what happened, what should have been reported, what the IRS already knows, and whether the failure was willful or non-willful. Those facts can significantly affect how the problem should be addressed.

International tax compliance is becoming increasingly interconnected. This new U.S.-UK partnership is another example.

Source: https://www.irs.gov/newsroom/irs-highlights-partnership-with-uk-tax-authoritys-new-whistleblower-program

IR-2026-120, Oct. 7, 2026 — The Internal Revenue Service today highlighted its partnership with the United Kingdom’s whistleblower program, which drew upon the IRS Whistleblower Office’s expertise to quickly get established.

10/06/2026

A tax preparer was just sentenced to more than four years in federal prison after a jury convicted her of preparing false tax returns.

According to the San Antonio Express-News, Natasha Banks Brown operated Tasha’s Total Tax Service and was convicted after investigators found false deductions and credits on client returns that significantly increased refunds. She was sentenced to 53 months in prison and ordered to pay $3.8 million in restitution to the IRS.

We've seen too many returns lately like this.

Taxpayers often come to us after they’ve been audited, and when we review their returns, I find deductions, credits or other positions they tell me they never understood or even knew were being claimed.

More than once, we've looked into the preparer and discovered that the person who prepared the returns is now facing criminal charges, has been prosecuted, or has otherwise gotten into serious trouble with the IRS.

Unfortunately, the taxpayer is still left dealing with the return.

That is why it is so important to review your tax return before it is filed. Ask questions if a refund seems unusually large, if you see deductions or credits you don’t recognize, or if your preparer cannot clearly explain what is being reported and why.

When an audit has already started, the preparer’s conduct can also matter. A taxpayer who did not know what the preparer was doing is very different from a taxpayer who knowingly participated in filing a false return.

Those facts can become particularly important when penalties or allegations of willfulness are involved.

Paying someone to prepare your return does not mean you should blindly sign it.

Source: Elizabeth Zavala, San Antonio Express-News, Oct. 5, 2026

10/01/2026

The Senate just unanimously passed a major taxpayer rights bill that could make a real difference for individuals dealing with the IRS.

The bipartisan Taxpayer Assistance and Service Act contains 65 reforms aimed at improving IRS service and strengthening taxpayer rights. It still must complete the legislative process before becoming law, but several provisions caught our attention as a tax law firm.

Among the proposed changes:

• Taxpayers experiencing financial hardship could be informed about collection alternatives, including partial payment installment agreements, Offers in Compromise and Currently Not Collectible status

• Certain lower-income taxpayers could have installment agreement fees eliminated.

• Offer in Compromise processing could be streamlined, with new appeal rights when the IRS determines an offer is “non-processable.”

• Taxpayers would receive stronger access to the IRS Independent Office of Appeals for tax liabilities, penalties and collection alternatives.

• Innocent spouse cases could receive broader judicial review, allowing courts to consider all relevant evidence.

• Taxpayers with delinquent balances could receive quarterly notices showing what they owe, estimated future penalties and interest, and available IRS assistance programs.

• Taxpayers could receive stronger rights to challenge liabilities in Collection Due Process cases and, in certain circumstances, obtain refunds or credits through Tax Court.

• IRS online accounts could be expanded to allow taxpayers and certain representatives to view returns, notices and other documents and respond to IRS inquiries electronically.

• A new IRS dashboard could provide real-time information on processing backlogs, call volumes, wait times and callback availability.

These are meaningful changes. They also highlight something I see regularly in our practice: taxpayers often don't know what options and rights they already have.

Someone who owes the IRS may assume an installment agreement is the only solution. Someone receiving a collection notice may not realize there is an Appeals deadline. Someone whose Offer in Compromise is rejected or returned may not understand what can be challenged.

That is where a tax law firm can make a significant difference.

The job isn't simply to call the IRS. It is to understand the taxpayers complete situation, identify available resolution and appeal rights, protect important deadlines and determine the appropriate strategy.

We are encouraged to see reforms focused not simply on IRS efficiency, but on giving taxpayers better access to information, meaningful review and clearer paths for resolving tax problems.

This is one we will be following as it moves through Congress.

Source: U.S. Senate Finance Committee, Taxpayer Assistance and Service Act: https://www.finance.senate.gov/chairmans-news/senate-unanimously-approves-bipartisan-taxpayer-assistance-and-service-act

Senate Unanimously Approves Bipartisan Taxpayer Assistance and Service Act

09/30/2026

Being called a “limited partner” does not necessarily determine whether your partnership income is subject to self-employment tax.

A recent Fifth Circuit decision gives limited partners more room to participate in a business without automatically losing the self-employment tax exclusion.

Under IRC § 1402(a)(13), a limited partner’s distributive share of partnership income may generally be excluded from net earnings from self-employment, although guaranteed payments for services are treated differently.

The big question has been: Who qualifies as a “limited partner” for this purpose?The Tax Court has applied a much stricter approach, essentially requiring the partner to function as a passive investor. The Fifth Circuit rejected that standard.

Instead, the Fifth Circuit held that a limited partner is someone who plays “no significant role in managing or running a business.” Importantly, the court said some participation is allowed, as long as the partner does not exercise control over the business.

That gives limited partners more room.

A partner may be able to participate in the business and still qualify for the self-employment tax exclusion. But it also creates a new practical question: How much participation is too much?

The Fifth Circuit did not answer that question for the partners in this case. It sent the case back for that determination under its new standard.

For partnerships and their partners, this is an important development because the amount of income potentially subject to self-employment tax can be substantial.

K Alain, L.L.L.P. v. Commissioner, No. 24-60240 (5th Cir. Aug. 12, 2026)

09/25/2026

The IRS has a new mobile app that gives taxpayers easier access to their IRS accounts right from their phones.

The new IRS app, launched today, replaces IRS2Go and expands the services taxpayers can access securely from a mobile device.

Taxpayers can now check refund status, view balances and payment activity, make payments, view certain notices, access available transcripts and tax records, and obtain an Identity Protection PIN.

I particularly like the addition of transcripts, notices, balances and payment history. These are some of the first things I look at when trying to understand what is happening with an IRS account.

One important point: seeing the information is not necessarily the same as understanding it or knowing whether it is correct. I regularly see IRS accounts with incorrectly applied payments, returns that haven't posted, penalties and multiple years in different stages of collection.

For straightforward matters, easier access is a good thing. For complicated IRS problems, the underlying account history still matters.

And make sure you're using the official IRS app. The IRS is warning taxpayers about look-alike apps and unsolicited messages seeking personal or financial information.

Source: IRS, IR-2026-114, September 25, 2026: https://www.irs.gov/newsroom/irs-launches-new-mobile-app-expanding-digital-services-for-taxpayers

IR-2026-114, Sept. 25, 2026 — The IRS today announced the launch of the new IRS mobile app, replacing IRS2Go and expanding the agency’s digital services to give taxpayers more ways to securely access IRS tools and account services from their mobile devices.

09/21/2026

Where you live and where you are considered a resident for tax purposes are not always the same thing.

Residency and multistate tax issues come up more often than many taxpayers realize. People move between states, maintain more than one home, work remotely, accept jobs with companies in other states, split their time between locations, or live and work across international borders.

Then tax filing season comes around and the questions begin: Where am I actually a resident? Where do I have to file? And which jurisdiction gets to tax my income?

There isn't one residency test that applies to every situation. Residency, domicile and income-sourcing rules can vary significantly depending on the jurisdictions involved.

States are particularly sensitive when a taxpayer claims that income is no longer taxable to them. New York and California, in particular, have detailed residency rules and active residency audit programs. These audits can become extremely fact intensive.

From a tax law firm's perspective, the best time to address these issues is before you make a significant change in where you live or work, not after.

That includes moving, but also accepting a job in another state, working remotely across state lines, regularly traveling elsewhere for work, splitting time between homes, or beginning cross-border work.

Get advice first. Understand the residency and income-sourcing rules, know where you may have filing and tax obligations, and have a plan before you execute it. Then document it.

Where are you spending your days? Where are you actually working? Where are your homes, family, business and personal connections?

And if the plan changes during the year, get advice along the way. Know what your tax situation looks like before the year is over, and definitely before the returns are filed.

We see residency issues turn into tax controversies because taxpayers often don't address these questions until they receive a notice. By then, we are looking backward and reconstructing what happened.

It is much easier to get ahead of a residency issue than to defend one several years later.

09/18/2026

The IRS is proposing a new question on Form 1040, and it raises an interesting question of its own: Why does the IRS need to know whether a taxpayer is legally authorized to work in the United States?

The draft 2026 Form 1040 asks:

“At the time you file your return, are you, and your spouse if filing jointly, a U.S. citizen, U.S. national, or an alien lawfully authorized to work in the U.S.?”

Taxpayers would answer Yes or No separately for themselves and their spouse. The question appears on the first page of Form 1040 under “Other Information.”

What makes this particularly interesting from a tax perspective is that citizenship, immigration status and federal tax residency are not the same thing.

A person does not necessarily have to be a U.S. citizen, or even be authorized to work in the United States, to have U.S. tax filing and payment obligations.

Adding the question directly to Form 1040 would therefore give the IRS a new standardized piece of information reported by taxpayers on their individual income tax returns.

How that information would ultimately be used in tax administration and compliance is the question. The draft form itself does not provide that answer.

For now, it is just that, a draft. The IRS specifically cautions that draft forms are not for filing and remain subject to change before final release.

Definitely an interesting development to watch.

Source: IRS, Draft 2026 Form 1040:

https://www.irs.gov/pub/irs-dft/f1040--dft.pdf

09/14/2026

One of the most common tax problems we see starts with income that a taxpayer simply forgot about.

Estimated tax payments are often associated with self-employed individuals, but they are not just for the self-employed.

Interest, dividends, capital gains, rental income, royalties, prizes and awards, and other income that does not have sufficient tax withholding can all create an estimated tax obligation.

And this is where we see problems develop.

Taxpayers forget about income they received during the year. They forget to tell their tax preparer about it. They don't keep track of the tax documents they receive. Sometimes they don't open IRS or state tax notices when they arrive.

Then they receive a notice saying the IRS, or their state taxing authority, has information showing income that wasn't reported on the return.

By that point, the original tax can be accompanied by penalties and interest, and what started as an organizational problem has become a tax problem.

Federal income tax is a pay-as-you-go system. If enough tax isn't being withheld as income is earned, estimated tax payments may be necessary. Generally, individuals who expect to owe $1,000 or more when they file may need to make estimated payments.

Don't wait until tax preparation season to figure this out.

Keep a running record during the year of income that isn't subject to withholding. Write it down. Keep the supporting documents together. By midyear, take a look at what you've received so far and estimate your total income and potential tax liability for the year.

If your income changes significantly later in the year, look at it again.

A little organization during the year can prevent a very common problem later: discovering that the IRS or state knew about income that wasn't on your tax return.

The next federal estimated tax payment is due tomorrow, September 15.

Source: IRS Tax Tip, “Estimated taxes aren’t just for the self-employed”

https://www.irs.gov/newsroom/estimated-taxes-arent-just-for-the-self-employed

Tax Tip 2026-69 Sept. 14, 2026 — Typically, people who are self-employed pay their federal income tax by making estimated tax payments.