TAX ISSUES FEDERAL AND STATE:
IRS/STATE TAX AUDITS
We have over 35 years of combined experience representing individuals, professionals, commercial businesses and small business owners facing an audit of their income, sales or employment tax returns by the IRS or state taxing authorities. In an audit, the government is represented by a team of well-trained specialists. Experienced, knowledgeable tax counsel is crucial to obtaining the right result in your case. Engage our team of attorneys to assist you in obtaining a fair result and potentially save you thousands of dollars in the process.
Audits typically fall into one of three categories:
- Office Audits
- Correspondence Audits
- At-Home Audits
The audit process usually begins when you receive a letter stating that your tax return has been selected for an examination. The IRS is not accusing you of cheating on your tax return, or engaging in any other wrongdoing. The goal of the IRS is to increase tax compliance and revenue collected by the government. Whether the audit is done via mail or in person the IRS is looking to see how much extra tax revenue they can collect from you. We recommend you contact us upon receipt of a notice to assist you with what can become burdensome and complex legal issues.
IRS TAX LITIGATION
Our team of attorneys has many years of experience handling Tax Court cases, including the ability to resolve most cases in IRS Appeals without ever needing to appear before the Tax Court Judge. In situations where all other avenues have been exhausted to settle your case the only option left is to litigate your case in Tax Court. The following is a partial listing of Tax Court litigation involving members of our firm.
- VanZelst v. Commissioner, T.C. Memo 1995-396
- Galyen v. Commissioner, T.C. Memo 2006-30
- Wenz v. Commissioner, T.C. Memo 1995-277
- Holowinski v. Commissioner, C.C. Memo 1997-168
- Peterman v. Commissioner, T.C. Memo 1993-129
- Steines v. Commissioner, T.C. Memo 1991-588
DELINQUENT TAX RETURNS
Every year millions of taxpayers fail to file their federal and/or state income tax returns, which often results in large amounts of back taxes, along with penalties and interest, being owed. Some taxpayers merely procrastinate; others are not aware of their filing requirement; and then there are those taxpayers who willfully fail to file. All of these taxpayers are regarded as “non-filers” by the IRS. In the majority of situations, the issues faced by non-filers can be resolved by engaging experienced legal counsel and addressing the problem. The continued failure to comply with the filing requirements may lead to serious situations, and in some instances, this may even result in a criminal tax prosecution for the failure to file tax returns.
The IRS often examines delinquent tax returns, which means the preparation and filing of a delinquent tax return requires a higher level of expertise and accuracy. It is paramount to move quickly and correctly, and to follow IRS guidelines for “voluntary compliance.” Let us help you comply with all filing requirements with the IRS and/or state taxing agencies.
OFFERS IN COMPROMISE
An Offer in Compromise (OIC) is an agreement between the taxpayer and the government to settle a tax liability for less than the full amount owed. An OIC can be based upon a doubt as to the actual tax liability or because a taxpayer cannot pay the actual amount owed with a doubt as to collectability offer. The IRS calculates the offer amount taking into account assets and monthly disposable income versus the amount owed relative to liabilities and monthly living expenses. This determination is referred to as the “reasonable collection potential.” The IRS views an OIC an acceptable alternative to declaring a case currently not collectible or entering into a “protracted installment agreement” with a taxpayer. The OIC represents an excellent opportunity to resolve all prior tax debts and obtain a financial “fresh start” with the IRS. We have resolved many difficult tax cases with an OIC. Please call us today to see how we can achieve similar results for you.
IRS PENALTY REMOVAL (ABATEMENT)
The IRS frequently asserts penalties and always adds interest to your delinquent tax liabilities, which in some instances will double (or more) the total amount owed. Our team of attorneys can assist to reduce or eliminate these penalties through penalty abatement requests to the IRS and state taxing agencies for both personal and business accounts.
TAX LEVIES AND LIENS
For any taxpayer delinquent in their tax obligations, the IRS and/or state taxing agency may and often will place a levy (garnishment) on your bank accounts, wages and for other assets. Additionally, it is common for the IRS and state agencies to file tax liens against you and your property and may even try to seize your assets. We can protect your assets and earnings from the IRS; however, time is of the essence. It is imperative you seek counsel in these situations as soon as possible to protect your rights.
An Installment Agreement is a payment arrangement with the IRS (and state tax agencies) allowing the taxpayer to pay the tax liability over a period of time. With an Installment Agreement in place, the IRS will refrain from engaging in enforced collection actions, including the levying of bank accounts or wages, as long as the taxpayer remains current with future tax filing and payment obligations. Please note that interest and penalties continue to accrue on the outstanding balance of the tax liability until the liability is paid in full.
Negotiation of an Installment Agreement is difficult and requires substantial knowledge about IRS guidelines and regulations. The determination of the minimum monthly installment payment that will be acceptable to the government depends upon the application of specific IRS income and expense standards. We have substantial experience assisting taxpayers to obtain the lowest possible monthly payment. Let us help you today.
INNOCENT SPOUSE RELIEF
Married couples typically file joint tax returns because of the advantage of certain tax credits and other benefits not available if filing separately. One potential drawback is that both spouses are responsible, jointly and individually, for any taxes, interest and penalties due on returns filed while you are married. Potentially, you could be held responsible for all amounts owed even if your spouse earned the entire income that year.
If your spouse (or ex-spouse), either unintentionally or deliberately, underreported income or overstated deductions you may be legally responsible to pay the tax bill. This can also be the case even if a divorce decree states that a former spouse will be responsible for the tax debts.
In some cases, a spouse will be relieved of the tax, interest, and penalties on a joint tax return. Three types of relief are available.
- Innocent spouse relief.
- Separation of liability.
- Equitable relief.
In general, innocent spouse relief is available if you signed a joint tax return without knowing or having a reason to know about an understatement of tax. In addition, the IRS will review the facts and circumstances of your situation to determine if it would be “fair” or “equitable” to hold you liable for the tax. It may also be possible to attempt to separate the tax liabilities of both spouses or attempt to obtain further equitable relief from the IRS.
Contact our office to 720-922-1120 or firstname.lastname@example.org to schedule a time to discuss your particular tax situation.