21 Century•Tax

Client examples · Financial advisor or insurance professional

The retiree who paid the bills from an IRA

Illustrative example. Not an actual client.

These are illustrative examples, not client stories. Each one is a composite of situations our team regularly sees in tax resolution work. Names, numbers and details are invented and do not describe any actual taxpayer. They show the kind of work involved, not a promised or typical result. Every case depends on its own facts, its documents and IRS decisions.

Financial advisor or insurance professional

The retiree who paid the bills from an IRA

Illustrative example. Not an actual client.

The facts

The original engagement

Retirement planning. The couple were also paying on a plan for taxes left over from a small business they closed.

What the case needed next

Tax resolution. Two large IRA withdrawals with no tax withheld created a new balance, the old plan was about to default, and a notice warned that part of their Social Security would be levied.

What a 21 Century review found
  • A new balance from the withdrawals, which the existing plan didn’t cover
  • More withdrawals planned, with no tax planning behind them
  • Social Security levy notice already received
  • The advisor’s planning work on hold until the tax problem was settled
Services 21 Century added (4)
  • Levy & Garnishment Defense
  • Add New Tax Debt to Your Case
  • Before You Cash Out a Retirement Account
  • Retirement Income Plan
Resolution

Levy addressed before it began, and both balances combined into one payment plan they can afford.

Lasting result

Tax withheld on every withdrawal, and withdrawals timed with Social Security to keep tax lower and steady.

For the partner firm

The advisor got back to planning, and kept the whole relationship. We don’t sell investment or insurance products.

The story

They closed the shop when he turned sixty-six and set up a payment plan for the last of its taxes. It was manageable.

Then the roof needed replacing, and there were medical bills. They took money from the IRA twice, and nobody told them to withhold tax.

The next April they owed again. The old plan couldn’t absorb the new balance, and a letter arrived about taking part of their Social Security.

Full descriptions of each service are on our services page. This page is general information for tax and financial professionals, not tax or legal advice for a specific situation. Eligibility for any relief, including penalty relief, spouse relief and the exclusion of forgiven debt, depends on the taxpayer’s facts and IRS review.

Have clients like this?

Tell us about your firm and the clients you serve. We’ll show you which services we can add for them.

Request partner informationCall (714) 868-0887