IRS Tax AttorneyWhile no one enjoys paying taxes, the revenue from income taxes, payroll taxes, and others permit the government to provide the service and infrastructure we have come to expect in California and in the United States. While most people understand the important of paying taxes, parting with your hard-earned money can be difficult and in difficult situations require an experienced IRS tax attorney to help to ensure that they are only paying in taxes what they are legally obligated to pay.
However, as Americans and Californians part of our cultural DNA is to question authority and to standup for what we believe is right. While these are admirable qualities, some taxpayers can be swept in in an anti-tax fervor. These taxpayers may fall under the influence of an offshore facilitator who fails to inform the taxpayer of his or her FBAR and FATCA disclosure duties. In other circumstances, the taxpayer may unfortunately buy the sales pitch of a disreputable tax return preparer who guarantees a refund without first reviewing the taxpayer’s finances. Still in other situations, the taxpayer may simply misunderstand his or her tax obligation and fail to disclose all income or otherwise make a substantial underpayment.
Each of these scenarios can lead to a tax investigation, IRS audit, and potential harsh tax consequences and require the expertise of an IRS tax attorney. Working with an experienced tax professional such as the tax attorneys and CPAs of the Tax Law Offices of David W. Klasing can protect you from the worst-case scenario while permitting you to come back into compliance with reduced penalties.
IRS Aggressively Pursues Taxpayers Who Fail to File or Evade Taxes through Understatements of IncomePerhaps you were out of the United States for several months in the spring last year and you simply forgot to file IRS taxes. Alternatively, perhaps your dealings with a tax preparer have resulted in an IRS tax audit. Unfortunately, all too often taxpayers think that lying or further attempting to conceal past acts will improve their position. In reality, such actions can exacerbate the situation by giving the appearance that you willfully failed to pay taxes due and owing.
Willful failure to pay taxes means that you intentionally or voluntarily disregarded a known legal duty and have foregone their belief that they need to be represented by an experienced IRS tax attorney. The willful failure to file taxes is contemplated under 26 USC Section 7203. If a taxpayer is convicted of a willful failure to pay their IRS taxes, he or she can face up to one year in federal prison, pay significant fines and penalties, and pay restitution to the U.S. government for the unpaid tax. Taxpayers who make threats, obstruct, or otherwise impede the administration of the internal revenue laws can be punished under 26 USC Section 7212. Conviction under this section can carry a prison sentence of up to three years and additional monetary penalties.
IRS Taxpayers Must Maintain FBAR and FATCA Offshore Disclosure ComplianceHolding or maintaining one’s authority over an offshore account or asset without making required FBAR or FATCA disclosures is extremely risky in today’s tax and global banking environment. Taxpayers are generally required to make an information filing to satisfy their FBAR and FATCA disclosure obligation if they hold foreign assets exceeding a certain threshold. Penalties for the failure to do so are harsh and, in the case of willful FBAR violations, can often exceed the original account balance.
Unfortunately, the risk of detection for taxpayers with undisclosed accounts has never been higher. More than 100 nations have agreed to share tax and foreign financial data with the U.S. government. Agents from the IRS and Department of Justice are using this information to identify and prosecute noncompliant taxpayers. While taxpayers can often mitigate the consequences they face for offshore account disclosure failures, time is of the essence since an investigation can make you ineligible to participate in the Offshore Voluntary Disclosure Program (OVDP) or Streamlined Disclosure.
Questions and Answers about IRS Tax Issues
What Do I Do If I’m Facing an IRS Tax Lien?Connect with an experienced IRS tax attorney. You cannot have a federal tax lien imposed against your property unless the IRS follows certain procedures. The first step in any IRS tax collections action to impose a tax lien is a notice of the IRS’s intent to take action. While notice can vary, it will typically inform you of a:
- Notice of Intent to Levy
- Notice of Federal Tax Lien
- Final Notice - Notice of Intent to Levy and Notice of Your Right To a Hearing