Awards & Recognition
Like any other legal dispute, a dispute with a federal or California taxing authority does not necessarily have to lead to the courtroom. However, litigation becomes necessary to resolve the conflict when a mutually acceptable solution cannot be reached at the audit or federal or state taxing authority internal appeals level. In such cases, it is essential to hire a tax litigation attorney who possesses a unique combination of tax knowledge and litigation ability. In San Bernardino, taxpayers may need to navigate both federal and state courts, including the United States District Court for the Central District of California, the United States Bankruptcy Court for the Central District of California, the United States Tax Court, the California Superior Court, San Bernardino County, the California Court of Appeal, Fourth Appellate District, Division Two, and the California Supreme Court.
Additionally, taxpayers may have to interact with various tax agencies, such as the Internal Revenue Service (IRS), the California Franchise Tax Board (FTB), the Employment Development Department (EDD) and the California Department of Tax and Fee Administration (CDTFA). At the Tax Law Office of David W. Klasing, our San Bernardino dual licensed Tax Litigation Attorneys & CPAs possess the necessary knowledge and skills to represent taxpayers in tax courts and before-mentioned tax agencies. With a unique combination of tax knowledge and litigation ability, our team is well-equipped to handle all types and complexities of tax disputes.
It is worth noting that tax litigation cases can be highly complex and involve intricate legal and financial issues. David W. Klasing is among an estimated 3,000 professionals in the country that has earned a law degree, is a licensed CPA and has earned a master’s in taxation making him a highly qualified attorney with specialized knowledge in the fields of tax law & accounting. Being among approximately 24,000 professionals in the country having earned both a law degree and a CPA license, David W. Klasing is uniquely positioned to provide clients with comprehensive tax litigation services. Moreover, our dual licensed San Bernardino Tax Litigation Lawyers & CPAs have the expertise to navigate all the complexities of tax litigation and provide our clients with the best possible outcomes.
Understanding Tax Deficiency Disputes and Tax Refund Litigation
Tax deficiency disputes and tax refund litigation are the two most common tax litigation cases. A tax deficiency occurs when the government asserts, usually because of an audit, that the amount of tax a taxpayer owes is more than the amount that they have filed on their business or individual tax returns. The IRS ordinarily issue a notice of deficiency at the conclusion of an unagreed audit, where they believe a taxpayer has underreported income, overclaimed deductions or claimed credits they were not entitled too. On the other hand, tax refund litigation involves disputes over the refund of taxes already paid. Taxpayers may need to litigate if they believe they are owed a refund that the IRS or state of California has denied.
If a taxpayer disagrees with the audit findings of the IRS, they can dispute the deficiency through an expedited appeals process or by filing a lawsuit in Tax Court. The expedited appeals process generally involves the auditor, their manager and an appeals officer and we have not found this an effective resolution method because both the auditor and their manger are emotionally invested in the audit results, and it often plays out as three against one.
The regular appeals process is achieved by filing a tax court petition and involves an independent review of the taxpayer’s case by an appeals officer not involved in the initial audit and the IRS auditor and their manger are not directly involved in the appeals process. The appeals officer will independently consider the taxpayer’s arguments and supporting evidence and attempt to reach a resolution with the taxpayer that also considers the hazards of litigation to the IRS in the client’s fact pattern. If the appeals process does not result in a resolution, the taxpayer has a second bite of the appeal with IRS Chief Counsel’s office on the Tax Court steps.
When filing a lawsuit in Tax Court, the taxpayer must prepare a complaint that outlines their legal arguments and evidence supporting their position in the dispute. The case will then proceed first to appeals, and then to chief counsel’s office prior to trial. At trial the taxpayer and their attorney must present their arguments and evidence to the judge. After the trial, the judge will issue a decision, which may be appealed to a higher court if necessary.
Note: The IRS has a 98% out of court settlement rate and consequently to date our office has never had to step foot in tax court, thus saving our clients the expense of having to formally litigate especially where we have believed the facts and the law were on our client’s side from the outset of the engagement.
Tax Refund Litigation: Taxpayers may also need to litigate tax refund disputes if they believe they are owed a refund of taxes they have already paid. Tax refund litigation can be complex and may involve issues such as the statute of limitations for filing a claim or the interpretation of tax laws. If the IRS denies a taxpayer’s refund claim, they may dispute the decision through an appeals process. The appeals process involves an independent review of the taxpayer’s case by an appeals officer not involved in the original decision. The appeals officer will consider the taxpayer’s arguments and evidence and attempt to reach a resolution with the taxpayer.
Suppose the appeals process does not result in a resolution. In that case, the taxpayer may file a lawsuit against the IRS in federal district court or the United States Court of Federal Claims to contest the refund denial. The litigation process may involve pre-trial proceedings, such as discovery, and a trial where the taxpayer and their attorney must present their arguments and evidence to the judge. After trial, the judge will issue a decision, which like deficiency disputes, may be appealed to a higher court if necessary.
At the Tax Law Offices of David W. Klasing, our San Bernardino Dual Licensed Tax Litigation Attorneys & CPAs possess the necessary knowledge and skills to represent taxpayers in tax deficiency disputes and tax refund litigation. We use our in-depth understanding of tax law and the litigation process to provide our clients with the best possible outcomes in their tax litigation cases. Overall, the IRS has a 98% settlement rate and does not want to litigate any more than you do. This means that in most cases, the taxpayer and the IRS can arrive at a mutually acceptable solution outside the court without the ordinarily enormous expense of actual litigation. However, if litigation becomes necessary, our experienced tax litigation attorneys will advocate fiercely for you, working tirelessly to achieve the best possible result for our clients.
Furthermore, we take a strategic approach to tax litigation that prioritizes resolving disputes as efficiently and cost-effectively as possible. We are proud to say that we have never stepped foot in Tax Court, which has spared our clients the most expensive part of tax litigation. We believe it is in our client’s best interests to resolve disputes through alternative means whenever possible. We have a proven track record of successfully negotiating settlements with the IRS and other tax agencies. Our dedication to providing our clients with personalized and effective representation is unmatched in the industry.
Other Common Triggers for Tax Litigation
Tax litigation can arise from various issues related to tax compliance, ranging from simple errors to deliberate tax fraud. Here are some of the most common causes of tax litigation:
- Audit Problems: Taxpayers may face litigation due to an unfavorable audit report from the IRS. Audit problems can arise when the IRS discovers errors or discrepancies in taxpayers’ tax returns or finds evidence of deliberate tax evasion or other tax crimes.
- Tax Fraud: Tax fraud is a deliberate attempt to evade paying taxes through false or misleading information. Tax fraud may involve:
- Underreporting income
- Overclaiming deductions
- Claiming credits that you are not entitled too
- Hiding assets in offshore accounts, and
- Using other illegal methods to reduce tax liability.
- Corporate Tax Issues: Corporations may face tax litigation related to transfer pricing, tax shelters, and executive compensation. Corporate tax litigation may involve complex legal and accounting issues that require the expertise of an experienced domestic and international tax litigation attorney.
- Other Tax Controversies: Tax litigation can also arise from a variety of other tax controversies, including
- Employment tax issues
- International tax issues such as foreign bank account reporting (FBAR) violations
- Sales and use tax disputes
- Trust fund recovery penalty disputes
- Estate and gift tax controversies
- Non-filing or underreporting of tax liabilities.
At the Tax Law Office of David W. Klasing, our San Bernardino dual licensed Tax Litigation Attorneys & CPAs have the necessary expertise to represent taxpayers in all federal and California tax controversies. We work closely with our clients to understand their situation and develop a customized strategy for resolving their tax disputes most efficiently and effectively. We are committed to providing our clients honest and transparent advice throughout the litigation. If we determine that your case can be bettered through the appeals and litigation process, we will inform you of such and take on your case. However, if we determine that there is no realistic possibility of achieving a better outcome, we will not take on the case. We never put our needs to make a living above your needs to be treated fairly by the taxing authorities. Our dedication to our client’s needs and extensive knowledge of tax law and litigation processes makes us the ideal choice for taxpayers facing tax controversies.
Why You Should Not Rely on Your CPA, EA, or CTEC Certified Preparer for Tax Litigation of Tax Appeals?
When facing a tax controversy, having an experienced tax attorney is essential throughout the appeals and litigation process. While CPAs, EAs, and CTEC-certified preparers may be able to prepare your tax return, they are not authorized to represent you in tax court. Filing the tax court petition is the unauthorized practice of law and can result in severe penalties for the preparer and negative repercussions (loss of non-asserted rights) to the taxpayer.
Additionally, even if a preparer is authorized to represent a taxpayer in an administrative appeal, they may lack the skills to advocate for your interests effectively. CPAs, EAs, and CTEC-certified preparers are not trained in persuasion, evidence, and tax procedure. They are unprepared, untrained, and engage in the unauthorized practice of law when come across criminal tax issues that could arise in the litigation process. They typically focus on preparing tax returns rather than representing taxpayers in tax litigation cases.
There is no attorney-client privilege between taxpayers and their preparers. Any communications or advice a taxpayer receives from a preparer can be legally compelled under a court contempt power to be disclosed to the government. This means that if you allow your CPA, EA, or CTEC-certified preparer to handle your tax litigation case, they may inadvertently become the government’s key witness against you. Therefore, working with a qualified tax litigation attorney who can provide you with the necessary legal guidance and advocacy while maintaining the attorney-client privilege is crucial. This attorney client and work product privileges allow clients to be candid with their attorneys and ensures that their communications remain confidential. By working with our qualified San Bernardino tax attorneys, you can rest assured that your communications will remain privileged and protected. We aim to represent your tax litigation case effectively, ensuring your legal rights and interests are fully protected.
With an estimated 1.1 million attorneys in the country, 560,000 CPAs, and only 24,000 dual licensed Attorneys and CPA professionals, David W. Klasing stands out as a rarity among his peers, possessing both legal and accounting licensing and expertise. In addition, with a Master’s in Tax, David W. Klasing is among an estimated 3,000 professionals in the country with similar credentials & licensing. His extensive knowledge of tax law and the tax litigation process, combined with an unmatched proven commitment to his clients of achieving the most economical and favorable resolution, makes him the ideal choice for taxpayers facing tax controversies. Contact us today to schedule a consultation and see how we can help you with your tax litigation case.
What We Can Do for You
David W. Klasing is a dual licensed Attorney & CPA with a Master’s in Taxation and has held positions such as Past Chair of the OCBA Tax Committee, Past Chair of the California Bar Tax Procedure and Litigation Committee, and Past Education Chair of the American Society of Attorney CPAs.
With a long history of wins for our clients, he has never lost a case and prioritizes ethics and honesty in everything he does. Whether you are facing an audit, deficiency dispute, or tax refund litigation, our experienced tax attorneys can provide the expert representation you need to protect your rights and interests. We work closely with our clients to develop customized strategies for resolving your tax disputes in the most efficient and effective manner possible.
We can provide strategic responses to protect your rights and interests if you’re dealing with IRS audits, offshore tax investments, or allegations surrounding false income tax returns. In the case of an IRS audit, we can guide you through the audit process, help you prepare a response to the IRS, and represent you during the audit itself. With offshore investments, we can help you navigate the complex web of tax laws and regulations surrounding these investments and ensure you comply with all applicable laws. If you are facing allegations surrounding false income tax returns, we can provide you with expert guidance and representation, helping you to build a strong defense and protect your rights and interests. With our help, you can be sure that you are being represented by one of the top tax litigation firms in the nation and that your case is in the hands of skilled and experienced tax attorneys.
We can also help you use voluntary disclosure programs to prevent or reduce tax penalties. Voluntary disclosure programs can be a powerful tool to avoid or reduce tax penalties for taxpayers who have not reported all of their income or assets to the IRS. By voluntarily coming forward and disclosing previously unreported income or assets, taxpayers may be eligible for reduced penalties or avoid criminal tax prosecution. Our tax litigation attorneys have extensive experience working with clients to determine their eligibility for voluntary disclosure programs and guiding them through the process. We can provide you with the guidance and support you need to decide whether to participate in a voluntary disclosure program. We can help you navigate the program’s requirements to secure a favorable result. By working with our team of San Bernardino tax attorneys, you can take advantage of the many benefits of voluntary disclosure programs and potentially avoid the steep penalties and legal consequences that may arise from failing to report all of your income or assets. Let us help you achieve peace of mind and a fresh start with the IRS.
As one of the top tax law firms in the nation, we are consistently ranked and awarded for our exceptional service and expertise in tax controversy and litigation. Our attorneys are recognized leaders and authorities in the field, with numerous media mentions and leadership positions. With our help, you can trust that your tax disputes will be resolved with a customized strategy tailored to your needs. We prioritize protecting your rights and interests throughout the litigation and strive to provide the best representation in all tax controversies. Contact our tax firm online today for a reduced-rate consultation. You can also call our San Bernardino office at (909) 991-7557 or contact our main office at (800) 681-1295. Please note that in-person meetings at our San Bernardino location are by appointment only.
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