What happens when a tax preparer gets your return badly wrong—and the IRS is already trying to collect? In this video, I break down a taxpayer’s situation involving a botched 2021 tax return, cryptocurrency gains and losses that may have been reported incorrectly, roughly $60,000 owed to the IRS, and an active IRS levy. The taxpayer believes correcting the return could reduce the balance by around $40,000, potentially bringing the IRS debt down into the high teens. The problem? The IRS is collecting based on the return currently on file, and amended returns can take a long time to process. I explain why it may make sense to attack the problem from both directions at once: - File the amended tax return as quickly as possible - Deal with the active IRS levy immediately - Consider an installment agreement while the amendment is processing - Understand how the payment plan may be adjusted once the IRS corrects the balance - Be prepared for the possibility of a Notice of Federal Tax Lie...