Taxation
A. Tax Advice and Planning
1. Income Tax
We give tax advice for personal income taxpayers, as well as Employment tax, and tax exempt businesses.
2. Sales and Employment Tax
The taxes paid for employees or the sale of product.
3. Trust
See Section on Trust.
B. Tribulations
1. Garnishments
This is when a taxpayer owing taxes to the IRS enters into an agreement with the Service to resolve the debt. This means that the IRS settles for less than the full payment. An offer in compromise is only available under certain circumstances such as when there is doubt as to whether the tax assesses is correct, or there is little likelihood that the taxpayer is able to pay the amount in full.
2. Tax Liens and Levies
A lien is a public record, filed in the county clerk where you or your business is located, in which the IRS states that you owe taxes. The levy is the actual action the IRS takes to collect the alleged tax owed. The IRS sends a notice to a third party, namely your employer or banker, to collect on tax you allegedly owe. Since you have 21 days to respond to the levy notice, you should do so promptly.
3. Offer in Compromise
This is when a taxpayer owing taxes to the IRS enters into an agreement with the Service to resolve the debt. This means that the IRS settles for less than the full payment. An offer in compromise is only available under certain circumstances such as when there is doubt as to whether the tax assesses is correct, or there is little likelihood that the taxpayer is able to pay the amount in full.
4. Audits
More often than not, people in the high income bracket are more likely to be audited than others. But anyone can be faced with an audit. Once the IRS decides to audit a person, they contact you and you have the right to have an attorney, or CPA represent you. The matter is initially at the audit stage i.e. at the correspondence, field or office stage but if the matter is not resolved it will go to appeals, tax court or collection.
5. Abatements
The IRS usually hands out penalties and interest as well as additional penalties for alleged tax infractions. An abatement asks the IRS to reduce/abate the penalties. Interest charged by the IRS is generally not available for abatement but the penalty itself is.
6. Payment Negotiations
When a taxpayer is unable to make the full payment of taxed owed, the IRS can offer, once all the returns which are due are filed, equal monthly installment plans. Note, any refund the taxpayer gets in the future will be applied against the amount already owed.
7. Bankruptcy
Often, people who are in bankruptcy proceedings are able to stop IRS from collecting taxes. Filing for bankruptcy puts into effect an automatic stay which immediately stops your creditors, here the IRS, from trying to collect what you owe them.
8. Appeals
Issues which are not resolved through the initial process are appealed at the filed level and then through tax court.
9. Other issues: Trust Fund Recovery, Payroll
Employers have to withhold taxes for income and employment taxes, including social security taxes. These taxes are called trust fund taxes because the employer is actually holding the employee's money in trust until s/he can make a federal tax deposit. There is a penalty if the employer does not withhold the taxes or does not have the funds available for deposit. Note, there are other issues including penalties for failing to pay the taxes due on a trust fund.
1. Income Tax
We give tax advice for personal income taxpayers, as well as Employment tax, and tax exempt businesses.
2. Sales and Employment Tax
The taxes paid for employees or the sale of product.
3. Trust
See Section on Trust.
B. Tribulations
1. Garnishments
This is when a taxpayer owing taxes to the IRS enters into an agreement with the Service to resolve the debt. This means that the IRS settles for less than the full payment. An offer in compromise is only available under certain circumstances such as when there is doubt as to whether the tax assesses is correct, or there is little likelihood that the taxpayer is able to pay the amount in full.
2. Tax Liens and Levies
A lien is a public record, filed in the county clerk where you or your business is located, in which the IRS states that you owe taxes. The levy is the actual action the IRS takes to collect the alleged tax owed. The IRS sends a notice to a third party, namely your employer or banker, to collect on tax you allegedly owe. Since you have 21 days to respond to the levy notice, you should do so promptly.
3. Offer in Compromise
This is when a taxpayer owing taxes to the IRS enters into an agreement with the Service to resolve the debt. This means that the IRS settles for less than the full payment. An offer in compromise is only available under certain circumstances such as when there is doubt as to whether the tax assesses is correct, or there is little likelihood that the taxpayer is able to pay the amount in full.
4. Audits
More often than not, people in the high income bracket are more likely to be audited than others. But anyone can be faced with an audit. Once the IRS decides to audit a person, they contact you and you have the right to have an attorney, or CPA represent you. The matter is initially at the audit stage i.e. at the correspondence, field or office stage but if the matter is not resolved it will go to appeals, tax court or collection.
5. Abatements
The IRS usually hands out penalties and interest as well as additional penalties for alleged tax infractions. An abatement asks the IRS to reduce/abate the penalties. Interest charged by the IRS is generally not available for abatement but the penalty itself is.
6. Payment Negotiations
When a taxpayer is unable to make the full payment of taxed owed, the IRS can offer, once all the returns which are due are filed, equal monthly installment plans. Note, any refund the taxpayer gets in the future will be applied against the amount already owed.
7. Bankruptcy
Often, people who are in bankruptcy proceedings are able to stop IRS from collecting taxes. Filing for bankruptcy puts into effect an automatic stay which immediately stops your creditors, here the IRS, from trying to collect what you owe them.
8. Appeals
Issues which are not resolved through the initial process are appealed at the filed level and then through tax court.
9. Other issues: Trust Fund Recovery, Payroll
Employers have to withhold taxes for income and employment taxes, including social security taxes. These taxes are called trust fund taxes because the employer is actually holding the employee's money in trust until s/he can make a federal tax deposit. There is a penalty if the employer does not withhold the taxes or does not have the funds available for deposit. Note, there are other issues including penalties for failing to pay the taxes due on a trust fund.
