More reason to avoid tax protester groups. The IRS last month cracked down on a new Internet-based tax scam in which a Colorado couple sold (for $1,600) advice on how people could avoid federal income taxes. Their solution: Renounce your U.S. citizenship in favor of "American" citizenship. A court ordered the couple to give the IRS a list of the 2,000 customers who bought the advice package. The lesson: Even showing interest in a tax-protester group could draw undue attention from the taxman.
Expect IRS to budge little on tax bill 'compromise.' The IRS's Offer in Compromise program that lets financially strapped taxpayers negotiate a tax bill is drawing heat in Washington. Tax experts say the IRS takes too much time to respond to compromise offers, then only accepts less than 17 percent of such offers. Advice: Avoid making unreasonably low offers and approach the IRS only if you fit in its financially distressed category. The agency just started imposing a $150 fee for compromise applications.