The IRS’ Form 433-B, Collection Information Statement for Businesses, is the form the IRS uses to determine a businesses’ ability to pay their tax liability. The form is required by the IRS when a business owes the IRS taxes, and requests that the IRS approve an installment plan, an offer in compromise, or place the currently noncollectible status.

Let’s Break it Down:

Section 1: Business Information

This section collects your business information. It asks for the basic contact information for the business, date of incorporation, type of business, amount of employees, monthly gross payroll, frequency of tax deposits, and if the business is enrolled in the Electronic Federal Tax Payment System. In addition, the form asks if the business has an internet sales and the type of credit cards, if any, accepted by the business.

Section 2: Business Personnel and Contacts

This section of the IRS form requires the business to list all partners, officers, LCC members, major shareholders, etc. One must include the name, title, address, social security number, phone number, ownership percentage and shares or interest, annual salary, and if they are responsible for depositing payroll taxes.

Section 3: Other Financial Information

This part of the IRS form collects deeper details about the business. It is important here to be as specific as possible. In this section you must include if the business has a payroll service provider, if the business is a party to any lawsuit, if the business is in bankruptcy, if any members of the business owe money to the business, if assets have been transferred for lower than fair market value, if there are any other business affiliations, if there is an anticipation of a increase/decrease in income, and if the business is a federal government contactor.

Section 4: Business Asset and Liability Information

In this section of Form 433-B, the IRS requests information concerning the assets and liabilities of the business which includes cash on hand, bank accounts, accounts receivable, investments, real properties owned, and business liabilities. It also asks if there is a safe on the business’ premises.

Section 5: Monthly Income/Expenses Statement for Business

This is the last section of IRS Form 433-B. In this section, the IRS asks for the business’s current monthly income and monthly expenses. In addition, the business must specify whether they use cash or accrual accounting. A year to date profit and loss statement is helpful when filling out this section.

Filing out Form 433-B can be timely and burdensome. Additionally, filing out the form incorrectly can be expensive. Lothamer Tax Resolution here to take away that burden and ensure that the form is prepared correctly. Call today to schedule your initial consultation. Let us take the weight of Form 433-B off your shoulders and reach a resolution today.