Awards & Recognition
Tax litigation, a specialized field within the broader scope of the law. It is the legal process or resolving civil tax disputes with or without potential latent criminal tax matters. This process aims to present, review, and ultimately decide on the tax issues within the appropriate legal forum. The stakes can be exceptionally high due to the intrinsic complexities of tax laws, with outcomes that can significantly affect an individual’s or business’s financial situation.
Understanding tax litigation is crucial, from disputes over tax deficiencies and refund claims to more grave allegations such as tax fraud or evasion. Whether you’re an individual taxpayer or a corporate entity, the potential implications of these disputes can be far-reaching. Like all cities within the state, Carlsbad, CA, operates under California’s complex federal and state tax regulations. California’s tax system is known for its unique features compared to other states. For example, it imposes one of the nation’s highest state-level income tax rates, significantly influencing individuals and businesses residing in Carlsbad. Additionally sales taxes, and specific business taxes, including local taxes in Carlsbad, can differ from other California cities and significantly more from other states.
Understanding these unique features is paramount for Carlsbad residents and businesses to ensure compliance and avoid potential tax disputes. Cases typically start with the California Franchise Tax Board (FTB) for California income tax issues or the Internal Revenue Service (IRS) for federal income tax issues. Suppose these administrative channels fail to resolve the dispute. In that case, taxpayers may escalate their claims to the U.S. Tax Court or the United States District Court for the Southern District of California. The FTB EDD and CDTFA all have internal appeals channels, then may proceeds to the office of tax appeals and finally to California’s version of Tax Court. Each taxing authoritity has its own set of procedures and technicalities, underscoring the need for specialized & experienced legal expertise in navigating Carlsbad’s tax litigation landscape.
With a deep-rooted understanding of the specific tax laws of Carlsbad and a thorough familiarity with the relevant tax agencies and courts, we at the tax law offices of David W Klasing are well-positioned to provide superior representation. We aid in resolving disputes administratively and excel in litigation when it serves our client’s best interest. As forceful advocates, we pull out all the stops to vigorously defend our clients, intertwining our extensive knowledge of local tax laws and court procedures with our deep commitment to safeguarding your rights.
David W. Klasing, a dual-licensed Attorney CPA, is among an elite group of only 3,000 professionals nationwide who have earned a law degree, a CPA license, and a master’s in taxation. His specialized expertise in tax law and accounting, combined with his prestigious roles 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, establishes him as a foremost authority in the field. With such extensive qualifications and recognition, David W. Klasing is uniquely positioned to provide comprehensive and high-quality tax litigation services to clients navigating the intricacies of tax disputes.
Tax Litigation and Controversy
Tax litigation and controversy is a specialized area of law that involves resolving tax disputes with federal, state, and local authorities. These disputes can arise from various forms of taxation, including income tax, estate and gift tax, or state sales and use tax. Whether the involved party is a business, trust, estate, or an individual, these tax controversies can significantly impact their financial standing and reputation.
Tax controversies are divided into two categories: civil and criminal. While both can be complex and challenging, they differ significantly in their nature, implications, and legal strategies required to handle them.
Criminal Tax Controversy
Criminal tax issues typically emerge when a taxpayer is suspected of committing a tax crime. Such crimes include tax evasion, filing false tax returns, or failing to report foreign assets. The process of criminal tax litigation involves an IRS criminal investigation or a CDTFA, EDD or FTB criminal tax investigation which may lead to criminal charges and court proceedings.
During a criminal tax investigation, the IRS meticulously examines the taxpayer’s financial records and tax returns to discern evidence of illegal activity. The IRS might also conduct interviews with witnesses and gather other types of evidence to fortify its case. If the IRS uncovers evidence indicating criminal behavior, the issue might be referred to the Department of Justice (DOJ) for criminal prosecution.
Being charged with a criminal tax offense can lead to severe consequences, including significant fines and potential imprisonment. The repercussions of a criminal tax conviction can be quite painful, with penalties potentially extending from a few years to over a decade in prison and substantial fines.
As dual-licensed criminal defense tax attorneys and CPAs, we offer invaluable support and guidance throughout criminal tax litigation. We assist clients from the early stages of investigations to potential criminal tax charges and court proceedings, helping them understand their rights, respond to information requests, negotiate settlements, and present robust legal arguments in court. Our primary objective is to de-escalate potential criminal tax charges and navigate the intricacies of the legal system, striving for the most favorable outcome in your case.
Civil Tax Controversies
Civil tax controversies typically originate from audit, assessment, and collection activities by a taxing authority or a taxpayer seeking a refund. Attorneys specializing in tax controversies can provide critical assistance in these civil matters by offering their expertise on substantive tax laws, liaising with revenue agents, developing audit strategies, and advocating for clients in administrative or judicial appeals.
At the federal level, resolving a civil tax controversy might entail discussions with the IRS, a written appeal to and discourse with the Appeals Office, and, potentially, litigation in the United States Tax Court, District Courts, or the Court of Federal Claims. A similar process is applicable in resolving civil tax controversies at the California state level.
At the Tax Law Office of David W. Klasing, our role is not just confined to resolving existing tax controversies. We will provide insightful counsel based on our comprehensive understanding of Califonria and federal tax law. As international tax attorneys, we play an essential role in helping taxpayers resolve issues arising from international transactions. By utilizing voluntary disclosure programs, we can aid in preventing criminal tax prosecution while reducing civil tax penalties. Moreover, our seasoned attorneys provide strategic representation in court proceedings, effectively addressing your tax controversies.
Why Your CPA, EA, or CTEC Certified Preparer Should Not Handle Your Tax Appeal
When facing a tax appeal, it might be tempting to let your Certified Public Accountant (CPA), Enrolled Agent (EA), or California Tax Education Council (CTEC) certified preparer to handle the process. After all, they have been working with you on your taxes and know your financial situation well. However, this could be a significant mistake that may cost you dearly. Here’s why:
- Unauthorized Practice of Law: Filing a tax court petition is a legal procedure that requires a licensed attorney. A CPA, EA, or CTEC-certified preparer does not have the legal authorization, licensing or the specialized legal knowledge to handle such a process correctly, which could lead to complications down the line.
- Lack of Training in Persuasion and Evidence: Attorneys are trained in persuasion and the rules of evidence. These skills are crucial in the courtroom, especially during a tax appeal. CPAs and tax preparers, while accounting and tax preparation experts, typically do not have this legal training.
- Inadequate Training in Tax Procedure: Tax litigation is governed by specific procedures that must be followed meticulously. A mistake in following these procedures can jeopardize your case. While your CPA or tax preparer may be well-versed in tax preparation, they may not have the necessary training to navigate these complex procedures effectively.
- Inability to Handle Criminal Tax Issues: If criminal tax issues arise during litigation, your CPA or tax preparer will not be equipped to handle them. Criminal tax issues require a legal defense outside the scope of what CPAs and tax preparers are trained to do. Far more concerning is likelihood that your representative winds up becoming the government’s star witness against you because of their lack of Attorney Client Privilege and Work Product protections.
- No Attorney-Client Privilege: Communications between you and your attorney are protected by attorney-client privilege. It means they can’t be disclosed without your permission. This privilege does not extend to communications with your CPA or tax preparer. In the event of a lawsuit, your CPA or tax preparer could be compelled to testify and become a primary government witness against you.
The Tax Law Offices of David W. Klasing is not just another law firm. We are a powerhouse in the world of tax law, consistently recognized as one of the top tax law firms in the nation. Our reputation is built on our exceptional performance and leadership in the field, demonstrated by numerous accolades, media mentions, and leadership roles. This distinction underscores the importance of professional representation in tax litigation cases.
Unlike CPAs, EAs, or CTEC-certified preparers, our attorneys possess the nuanced understanding of tax law required to handle the complexities of tax appeals. These non-attorney professionals lack the legal training to effectively persuade, address evidence, navigate tax procedures, or deal with potential criminal tax issues that may arise during litigation. Further, they are not covered by attorney-client privilege, which could compromise your position in a dispute. Trusting such critical matters to professionals not adequately equipped to handle them could result in unfavorable outcomes. Thus, entrusting your case to our experienced dual-licensed to our Tax Litigation Attorneys and CPAs will significantly enhance your chances of a favorable resolution.
What The Tax Law Offices of David W Klasing Can Do For You
An unfair tax situation can leave you feeling victimized where the tax authority clearly got either the fact or the law wrong in your case. You can either accept what the IRS, FTB, CDTFA or EDD is doing to you or let us do what we do best – fight your battles zeouluously and aggressively for you. The IRS, for example, has a 98% settlement rate and genuinely prefers to avoid litigation, much like you do. Our approach is simple yet effective; if we believe your position can be improved through the appeals and litigation process, we inform you and take your case. We never prioritize our financial needs to earn a living over your fair treatment by the tax authorities.
Our impeccable track record reflects our commitment to clients, as we have never “lost” in tax court. We will not take your case if we do not believe we will win. Our expertise spans offshore asset matters, voluntary disclosures, IRS audits, and disputes with California state tax authorities. With international tax issues, complexities and exposure can increase exponentially, and the process can bewilder any taxpayer caught in a federal or California tax controversy.
Clients rely on the Tax Law Offices of David W. Klasing for our in-depth knowledge of the tax controversy process and the credibility we command in our interactions with the IRS and other domestic and foreign tax authorities. While most tax disputes are resolved by agreement or administrative settlement, sometimes going to court is the only way a taxpayer can seek to prevail. This path adds another dimension of risks and opportunities.
Our highly-skilled, dual-licensed Tax Attorneys and CPAs translate the firm’s substantive knowledge and courtroom experience into winning litigation strategies across various forums where tax cases can be prosecuted. These include the U.S. Tax Court, the U.S. Court of Federal Claims, Federal District Courts, Bankruptcy Courts, and various appellate courts nationwide. Trust in our expertise, and let us turn your tax litigation challenge into an opportunity for victory.
To discuss your tax needs confidentially in a reduced-rate initial consultation with our award-winning Carlsbad dual-licensed tax attorneys and CPAs, contact us online, or call (760) 338-7035 or (800) 681-1295 for prompt assistance. Our Appointment Only Carlsbad office is located at the following address:
701 Palomar Airport Road
Suite 300
Carlsbad, California, 92011
Questions and Answers About Tax Litigation
- Requirements to litigate tax court deficiency action
- How to litigate a claim in Federal Claims or District Court
- What discovery methods apply in Federal Tax Litigation?
- What is a notice of deficiency?
- What tax issues can be successfully litigated?
- Which federal court should I litigate my tax issue in?
- Who Can Represent a Taxpayer in the Tax Court?
- Who has the burden of proof in Tax Litigation
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