Los Angeles Tax Attorney and CPA
Tax Law Offices of David W. Klasing
10940 Wilshire Blvd. #1600,
Los Angeles, CA 90024
Tax issues affect every U.S. citizen and foreign resident with U.S.-based interests. You are right to be concerned about your past and upcoming tax filings, as mistakes or failure to include aspects of your filing could lead to serious civil and even criminal tax penalties. To avoid these issues from affecting your financial status, you can benefit from the advice of a seasoned Los Angeles dual-licensed Tax Attorney and CPA.
We can walk you through both the federal and state tax obligations that apply to Los Angeles residents each year and apprise you of any relevant changes to the tax code as it develops. We also have experience dealing with foreign reporting requirements if you have assets overseas that require additional reporting actions. If you discover past noncompliance in your previous filings, you can use your Los Angeles Tax Attorneys and CPAs to walk you through the voluntary disclosure process to avoid costly fines or even potential jail time. If your tax returns have been selected for an audit, we can help you prepare responsive documentation and monitor the progress of the audit to determine and mitigate any emergent risk.
Without the seasoned eye of the Los Angeles dual-licensed Tax Lawyers and CPAs at the Tax Law Offices of David W. Klasing, your tax issues could snowball and result in serious consequences. Avoid these consequences by calling us today at our Los Angeles offices at (800) 681-1295.
One of The Best Tax Attorneys in Los Angeles
Los Angeles is one of the busiest cities in the world from an economic standpoint. It is home to businesses of all kinds, each of which have their own unique tax situations.
Finding a trustworthy Los Angeles Tax Attorney is important to keep you on the right side of state and federal tax laws, while you attempt to legally reduce your overall tax burden, especially when you have a business that has an international presence.
Beyond income taxes, you may be subject to a variety of taxes as a business owner in Los Angeles. You must submit records of your payroll tax receipts to the federal and state government. You also must meet all of your sales tax collection obligations in the state of California. Failure to comply with either of these situations could result in an audit.
Individuals in Los Angeles may have uncommon personal tax situations that require the help of an LA Tax Attorney. Income earned in non-traditional professions or locations can result in complex tax compliance issues for individual and business (entity) taxpayers.
Contact the Tax Law Offices of David W. Klasing today for help with any and all state, federal, and international tax situations, including a failure to file taxes on time. At our Los Angeles tax law offices, our team is ready to represent your interests in areas of tax planning, IRS audit defense, and everything in between.
Los Angeles Taxpayers
Many businesses and taxpayers in and around Los Angeles have benefitted significantly from the strong local, state, and regional economy yet do not use the services of a local L.A. tax attorney when they face potential tax audits or inquiries. Los Angeles is an international city with a booming entertainment industry that not only reaches across the United States but also the world. Furthermore, L.A. is fortunate enough to be located on the west coast close to major ports bringing goods, products, and commodities from Asia and China. Thus, some companies also operating overseas may have additional international tax obligations on the funds they repatriate. Furthermore, due to the area’s significant ties to the worldwide economy, individuals living in Los Angeles are more likely to have foreign disclosure and international tax obligations.
These economic advantages have led to the development of some of the more wealthy areas in the United States. In particular, Beverly Park, The Hill Section of Manhattan Beach, Beverly Hills, Woodland Hills and Hidden Hills are neighborhoods where great financial success is the rule. However, the prosperity in Los Angeles may mean that taxpayers in the area face a higher than average risk of a tax audit. A recent study by the National Taxpayer Advocate showed clusters of tax enforcement activity in wealthy parts of major metropolitan areas. Los Angeles was one of the cities identified in the report. This is likely a case of the IRS focusing its efforts on where the money is in order to maximize its return on tax enforcement efforts. Nevertheless, taxpayers should recognize this risk and engage in appropriate measures to maintain or achieve compliance with the U.S. Tax Code.
Most citizens, legal permanent residents, and others in the Los Angeles area, all have an obligation to file their income taxes on a yearly basis. Typically, the deadline to file one’s personal taxes is April 15. Whether an individual is obligated to file a return is based on his or her filing status and level of income. For example, in 2014 a single filer aged 65 years or older must file if he or she has $11,700 or greater in income. However, a sole filer who has yet to reach the age of 65 would be required to file after earning only $10,150 in income. In general, heads of households, married taxpayers who file jointly, and certain widowers who have qualifying dependents can earn more before they are required to file. However, many of these individuals would likely want to file regardless because the only way to obtain one’s income tax return is to file. Learn more about the importance of hiring a Los Angeles income tax attorney.
California State Income Taxes
Aside from the obligation to file federal income tax, Los Angeles taxpayers are also obligated to pay the state income tax. The California Franchise Tax Board (FTB) is the state agency responsible of administering and enforcing the state income tax. The tax brackets for the state income tax are indexed to this figure. For the 2015 tax year, the maximum rate for an individual is 12.3%. Certain individuals may fall within criteria requiring them to pay the Alternative Minimum Tax which is set at 7%. Furthermore, individuals with taxable income in excess of $1 million, are subject to a Mental Services Tax of 1% for all income above this threshold. Residents of L.A. should, generally, file their individual California Resident Income Tax Return via form 540 or 540 2EZ. Taxpayers who fail to satisfy any element of their federal or state tax obligation are likely to receive a notice from the relevant agency concerning the deficiency.
International Tax Obligations
Taxpayers who hold or control account balances in excess of the filing threshold must also prepare and file annual offshore tax disclosures. There are two sources for this obligation: FBAR (Report of Foreign Bank & Financial Accounts) and FATCA (Foreign Account & Tax Compliance Act). To satisfy one’s offshore tax obligation one may be required to disclose an account under FBAR, FATCA, or both. Failure to comply with offshore disclosure obligations can result in significant fines and penalties including a $10,000 penalty for even an inadvertent violation of FBAR. Penalties for conduct perceived as intentional or voluntary can carry significantly harsher penalties that routinely exceed the original foreign account balance.
Offshore Voluntary Disclosure Program (OVDP) and Streamlined Disclosure can offer non-compliant taxpayers a means to correct past inaccurate, incomplete or missing FATCA or FBAR filings. However, it is important to consult with an experienced tax lawyer before filing to participate in either program. On one hand, the Streamlined Program can provide for significantly reduced penalties in comparison to standard OVDP. However, only OVDP provides some level of insulation from criminal penalties should willfulness be at issue. Taxpayers who mistakenly enter into Streamlined when they intentionally or voluntarily avoided this duty may face criminal prosecution bolstered by the disclosures they just made. By contrast, a taxpayer who is not willful but enters into standard OVDP will pay significantly more in offshore penalties than they would have through the streamlined program.
We touched on the concept of streamlined disclosure above, but it is important to go into more detail. One of the most important things to understand is that the streamlined disclosure process is reserved for those individuals who made unintentional errors in disclosing money in offshore or overseas financial accounts that was required to be disclosed under FBAR or FACTA. This means that if you acted willfully to avoid your reporting or payment obligations, you will not be eligible for the streamlined disclosure option.
Many people make unintentional mistakes related to the disclosure of foreign bank accounts. The law is complicated and ever-changing, and it can be difficult for those living overseas or those with foreign bank accounts or income to keep track of which accounts are covered under these laws and the various threshold amounts for required reporting. However, if you did understand these laws and willfully ignored them, and then proceeded to report your overseas income through the streamlined disclosure process, you can open yourself up to serious criminal charges.
It is vitally important to consult with a Los Angeles tax lawyer before deciding to enter the streamlined disclosure program. Speaking with a CPA or other type of financial or accounting professional will not grant you the type of confidentiality that comes with speaking to an attorney. They could later be subpoenaed and forced to turn over documents or relay your conversations. When speaking to a tax attorney, anything you say will always remain between the two of you under attorney-client confidentiality. A tax lawyer in Los Angeles will undertake a careful and comprehensive review of your actions to be sure that you did not do anything that could be viewed as willful. If you did, you would need to go another route such as OVDP, because streamlined disclosure may only further complicate things for you.
Once you have consulted with a tax attorney, and the attorney has determined that your actions were unintentional oversights rather than a wanton disregard for the law, you can proceed to decide if you would like to participate in the streamlined disclosure program. The streamlined disclosure process can offer a lot of benefits to those taxpayers who were unaware of their reporting responsibilities.
For example, the OVDP process, which is the route those who willfully chose not to report foreign income will have to take, results in penalties of 50% of the highest amount in your offshore accounts over the 6 year period of the offshore voluntary disclosure. By contrast, the streamlined disclosure process results in no penalty at all for taxpayers living outside of the United States (expats) or a 5% penalty for those that live in the U.S. There is also no failure to file, failure to pay, or 20% accuracy fees assessed on those who participate in the streamlined disclosure process.
There are several requirements to participate in this program. First and foremost, as discussed in detail above, you must certify that your conduct was not willful under penalty of perjury. A second major requirement is what is known as the non-residency requirement. This program is only available to U.S. citizens or green card holders who have spent most of their time living outside of the United States in the past 3 years. Specifically, in at least one of the past three years you must have not had a U.S. abode (primary residence) and must have been physically outside of the country for at least 330 full days. For joint tax filers, both spouses must meet this requirement.
The process for filing once you have determined you are eligible is complicated and you should rely on the expertise of a tax attorney who can prepare and review all documents submitted to the IRS. Depending on whether any returns related to these foreign accounts were filed, you will need to either file new returns or update your returns to reflect the existence of these assets. This applies to the previous 3 years where a tax return was supposed to be filed. Out international tax lawyers and CPAs can help you determine precisely which documents need to be filed. These documents must indicate that they are being filed as part of the streamlined disclosure program. You will then need to remit all tax that is due on these accounts for the past 3 years, including any interest that has accrued.
The streamlined disclosure program can be a huge relief for those citizens living abroad who were legitimately unaware of their U.S. reporting and tax obligations. However, it is massively important that you retain a tax attorney in Los Angeles to help you through this process, because mistakes in filing can result in serious penalties or fines.
Failure to File Taxes
Taxpayers in Los Angeles and beyond have an obligation to file and pay taxes. This obligation includes filing and paying taxes by the deadline. If a federal extension is filed via IRS Form 4868 Application for Automatic Extension of Time to File U.S. Individual Income Tax Return the extension applies only to the amount of time to file – the payment of the taxes or an amount satisfying the safe harbor provision is still due by the original date. A similar extension can be obtained for state tax obligations via the filing of FTB Form 3519 along with an estimated tax payment. Individuals who will receive a refund or no balance due receive an automatic six-month extension. Individuals who fail to file or pay state or federal tax or make arrangements consistent with the preceding may face penalties. Individuals whose actions raise red flags in IRS or FTB systems are likely to face an audit or tax examination.
The IRS may send an array of notices or letters to inform the taxpayer of their selection for an examination or the agency’s need for additional information. If the FTB makes changes to a taxpayer’s return, it may send the taxpayer a Return Information or other documentation detailing the changes and tax balance. Furthermore, taxpayers who fail to take action regarding the requests, may have the IRS or FTB file a tax return on their behalf. This return is rarely filed with the taxpayer’s best interest in mind and often results in significant additional liabilities and penalties. California tax payers who proceed to collections at the state or federal level may face a lien on their property, a levy to seize their property or assets, or a garnishment on their wages.
Business Tax Audit by the Employment Development Division (EDD)
Furthermore, Los Angeles businesses in California and throughout the United States have an obligation to account for, hold, and turn over payroll tax receipts to the U.S. government. These taxes are sometimes referred to as trust fund taxes because although it is the business owner who accounts for and collects the tax, the money is actually being held in trust for the U.S. government. Therefore, penalties for payroll tax fraud and evasion are severe and can, upon conviction, include the imposition of personal liability on the part of the business owner or responsible party. Problems of this type are financially disastrous for both the business and for the individual.
An audit by the California Employment Development Division is often the start of a trying and difficult for a business owner. Chiefly, the EDD is concerned with employment tax payments and handles payroll tax audits. Typically, this process requires an in-person interview that will also include a tour of the business and its facilities. The agent from the EDD often uses this tour to gather information about the company and its operations. In many cases, they may even conduct an informal interview of the person giving the tour of the premises. Practices and characteristics of a business that may trigger an audit by the EDD include:
• Use of structured transactions – Transactions made only to circumvent tax obligations, cash reporting laws and other paper transactions with no economic substance can create fertile ground for an EDD audit. The evasion of certain cash reporting laws through multiple transactions and other methods of structuring may also result in a referral to the IRS or other relevant state agencies.
• Inappropriate use of corporate or business funds – Business owners who commingle personal and company money set themselves up for possible criminal charges. Likewise, CEOs and stakeholders who use company money for family members, to pay personal expenses, or who mischaracterize expenses are also preferred targets for the EDD.
• Excessive cash transactions – In some instances, the use of cash in the business may be completely innocent and merely related to the industry and type of transactions. However, the EDD realizes that transactions of this type prevent a greater potential for abuse. Thus, businesses dealing primarily or exclusively in cash face a higher audit risk. Further, due to Los Angeles’ proximity to operations by Mexican cartels and instances of money laundering on their behalf in L.A.’s Fashion District, EDD and other regulators watch cash businesses closely.
Business owners who fail to keep sufficient records of the company’s finances and transactions often exacerbate the potential consequences of an EDD audit. Absent business records, the owner and other responsible parties may face difficulty in proving the source of cash. Whether your business in Los Angeles is a retail location, a bar or liquor store, a medical practice or another type of company keeping accurate and sufficient records is of the utmost importance. Furthermore, the practices described above can also result in a federal employment tax audit by the IRS.
Business Sales Tax Audits By California Board of Equalization
Business owners must also be sure that their company’s books are in good order and that sales and payroll tax obligations have been accounted for and addressed. Sales Tax in California is administered by the California State Board of Equalization (BOE or SBE). In recent years, the BOE has cracked down on sales tax evasion and abuses including the use of zappers; devices that can alter sales records as part of a scheme to avoid sales tax. Penalties for state sales tax evasion are severe.
Typically, a California sales tax audit conducted by a state auditor will begin with an examination of the business records. Regulation 1698 Records sets forth the types of records a business owner must keep and provide in the case of a sales tax audit. Generally, the records that must be kept merely begin with the normal books of accounts that a business owner keeps in the regular course of business. The standard that guides these records is objective in nature and not based on the individual business. Rather it was premised on the type of records an “average prudent businessperson engaged in the activity in question.” These and other required records that should be kept for a minimum of four years may include:
• Register receipts whether electronic or paper
• Cash receipts
• Schedules used in the preparation of tax returns
Audits by the BOE are best handled by having an LA tax lawyer engage with the auditor early in the process. During these initial discussions ground rules for the audit should be discussed and decided upon. Furthermore, discussions should also include contingencies for potential problems including what will happen if the auditor determines the documents are insufficient or he or she perceives problems or inconsistencies in the records.
Typically, if problems are found, the auditor may initiate an in-depth review. The thorough review will typically involve an audit either on a sample basis or on an actual basis. An actual basis audit will examine every transaction and assess sales tax on this basis. A sample basis audit will take a certain time period or statistical sample and assess sales tax on this basis. As one can imagine, a non-representative sample may result in the imposition of an overstated sales tax liability. Since, in this scenario, the tax assessed is based on inflated sales that were never actually made the business may face a tax burden that cannot be satisfied or results in a capture of a substantial amount of legitimate profits. In any case, this is one of the potential nightmare scenarios that can be avoided by working with a tax attorney who takes an active role in the audit from its start. Business owners who wait until a problem is discovered to attempt to negotiate or reason with the auditor do so from a position of weakness rather than strength. These individuals often face worst-case scenarios. For certain businesses that depend on licenses subject to suspension for unpaid sales tax, like liquor stores, a BOE audit that goes poorly can place the entire operation and organization in jeopardy.
What is an IRS Eggshell Audit?
Eggshell audits can pose elevated risks compared to other audits already discussed. These civil audits occur when the taxpayer and potentially their representative knows information regarding intentional or inadvertent, substantial, noncompliance that the IRS representative does not, and the taxpayer is at high risk of facing civil fraud penalties or criminal tax prosecution. Generally, eggshell audits manifest when information has not been reported or has been materially & intentionally misrepresented on a series of tax returns. Intentionally overstating deductions or understating income are two actions that create conditions for an eggshell audit to emerge. Claiming credits that the taxpayer is not entitled to could be another cause.
Both negligent and intentional errors can lead to an eggshell audit that results in additional tax penalties & interest at best, and at worst, a civil fraud penalty, or criminal tax investigation & prosecution. Even an honest mistake can create significant potential liability. Suppose a review of documents requested in an IRS audit reveals an unintended material error. In that case, contacting our Dual Licensed Tax Lawyers and CPAs is crucial to obtain legal representation and address the errors in a manner that keeps the issue about purely money while minimizing criminal tax exposure.
Avoiding an eggshell audit requires full tax compliance and disclosure, which occurs long before such an audit has begun. In this instance, prevention is the best defense. You can reduce your risk of exposure by utilizing proficient tax preparation services when preparing tax returns. If you suspect that you are currently experiencing an eggshell audit, our Dual Licensed Tax Lawyers and CPAs can intervene to protect your interests.
Criminal Liability and Reverse Eggshell Audits
A reverse eggshell audit is far more dangerous than an eggshell audit. In this scenario, the IRS investigator knows information about the tax returns in question, but the taxpayer is not aware that the investigator has already discovered the incriminating information. Reverse eggshell audits are like a Trojan horse in that a criminal tax investigation is disguised as a civil audit. Auditors may request information aimed at providing that the taxpayer was willfully evasive or untruthful with return under audit. Reverse eggshell audits can consist of simultaneous civil and criminal tax investigations or can start as only a civil audit that is later referred to an Fraud Referral Specialist or an IRS Special Agent for evaluation as to criminal tax liability.
Like with any audit issue, prevention is crucial to reduce or mitigate civil or criminal tax liability. It is crucial to get in front of these audits by ensuring that your tax returns are prepared accurately and that all necessary disclosures are made. If you know for a fact you have a history of filing fraudulent returns, a voluntary disclosure entered into before a audit or criminal investigation has been initiated is the key to avoiding criminal tax culpability.
Hiring our Dual Licensed Tax Lawyers and CPAs to represent you or your business during an audit will help mitigate any risks and identify and successfully mitigate potential reverse eggshell audits. Part of what makes a reverse eggshell audit so risky is that a taxpayer is being criminally investigated without knowing it. That means they will not ordinarily avail themselves of the constitutional protections like the Fifth Amendment right against self-incrimination and the Fourth Amendment right against unreasonable searches and seizures. The Tax Law Offices of David W. Klasing excel at recognizing when an IRS representative’s actions suggests a clandestine criminal tax investigation is occurring or imminent and take action to reduce your exposure.
If the statements or behavior of an IRS agent suggests a criminal tax investigation is ongoing, involving a criminal tax defense attorney as early as possible in your audit is crucial to preventing the inherent criminal tax exposure in your audit from evolving into a full-blown criminal tax prosecution. When an IRS representative is collecting evidence for a clandestine criminal tax investigation, your attorney’s intervention might prevent such an investigation from resulting in criminal tax charges. Certain lines of questioning, a focus on the intent behind various tax reporting decisions, the sudden halting of an ongoing audit, and other suspicious behavior are obvious red flags to the trained eye. Quickly identifying a reverse eggshell audit will allow you and your attorney to take protective action immediately. As of the date of this writing, the Tax Law Offices of David W. Klasing have never had a client go to jail as the result of an audit, eggshell audit, or reverse eggshell audit.
If you suspect, or know for certain, that an eggshell, reverse eggshell, or criminal tax investigation is underway, we can prevent you from making criminal tax admissions, prevent unreasonable searches and seizures, and help protect your due process rights. If constitutional rights have been violated, our Dual Licensed Tax Lawyers and CPAs can fight to suppress the evidence that was improperly obtained.
Field Audits Conducted by the IRS
The most invasive, high risk and detailed IRS examinations occur in field audits. This type of audit takes place in person at the taxpayer’s home or place of business. An IRS Revenue Agent will perform such an audit, and they usually have more expertise than a typical IRS representative. A field audit bears significant civil or criminal exposure risk on its own, but exponentially more so if it is also an eggshell or reverse eggshell audit.
When a business is selected for a field audit, it will entail much more than just reviewing the taxpayer’s business records. The IRS Revenue Agent may interview employees about business procedures, policies, accounting controls, management structure, compliance activities, and potentially additional topics. When such information is requested verbally from random employees, it can be difficult to control the amount of information available to the auditor.
Our Dual Licensed Tax Lawyers and CPAs can help your business prepare for this invasive examination and be present for the interviews to mitigate the inherent risks in real-time. The IRS will provide a list of requested documents in advance of the field audit. Our attorneys can review the documents you intend to provide and evaluate their level of responsiveness. You should provide the documents and information requested without providing more than precisely what was asked for. This same strategy applies to interview responses without coming off as evasive.
Verbal interviews will require thorough and advanced preparation of the interviewees. IRS Revenue Agents are trained to ask questions to elicit the most information as possible and often ask open ended questions designed to illicit stream of consciousness type answers. An unprepared & unrehearsed response to a question could, at best, lead to excessive follow-up questions. At worst, an interviewee could unknowingly admit evidence of civil or criminal tax liability. Our Dual Licensed Tax Lawyers and CPAs will tirelessly work to prepare your business for a field audit and carefully monitor the audit as it progresses to prevent unnecessary disclosures, prevent a “fishing expedition” and a facilitate a timely and, where possible, advantageous, close to the audit.
The Dual Licensed Tax Lawyers and CPAs at the Tax Law Offices of David W. Klasing understand both the financial and legal (criminal tax exposure) issues inherent in audits. We can identify existing hidden risks for mitigation and help prevent additional risks from developing in the most aggressive IRS audits.
How Do You Choose a Tax Lawyer in Los Angeles?
Tax issues present themselves in a wide variety of ways. You could be worried about issues that affect your past or upcoming filings, the prospect of facing an audit, or impending civil or criminal tax charges. In many cases, concerned taxpayers have more than one of these issues on their minds. If they don’t, they could find themselves facing a litany of problems before they even realize it.
To combat these issues, you will want legal counsel with experience and knowledge in the realm of tax law. But not just any tax lawyer will do. You would be best served by a legal service that can help you in every aspect of your tax situation. Not every tax law firm has in-house services of Certified Public Accountants (CPAs). By using knowledge from multiple fields, dual-licensed Tax Attorneys and CPAs provide a more circumspect approach to tax law issues that can benefit clients in multiple ways.
This is why the Tax Law Offices of David W. Klasing are uniquely qualified to assist clients in all areas concerning their tax status. Our dual-licensed Tax Attorneys and CPAs have interdisciplinary knowledge that allows us to provide various services that you might otherwise need to seek from two or even three different sources. By using our services, you make us your one-stop shop for all of your tax needs, streamlining your case and centralizing your tax defense strategy.
You will also want a Tax Lawyer that is local to you, even if you are dealing with federal tax issues. Los Angeles residents can benefit from visiting their attorney’s Irvine offices for an in-person discussion. Additionally, if you are called in for an IRS office or field audit, your local tax attorney can physically go to your appointment with you and make sure that you are treated fairly and equitably under the law throughout the process and that is specifically why we maintain the Los Angeles Satellite office, to have a place to meet with auditors outside of your home or business. The Tax Law Offices of David W. Klasing have locations throughout the State of California, including Los Angeles. They can provide you with the personal and direct services that your case deserves.
Los Angeles Federal, State and International Tax Experience
The tax code can be challenging to navigate and interpret, and the consequences of a mistake could include prison time, expensive fines, penalties for your business, and lost financial opportunities. But whatever tax issue you may be facing, whether you are concerned about an IRS audit or need assistance planning an international estate, the Tax Law Offices of David W. Klasing can help.
With his unique dual qualification as both a Los Angeles tax law firm attorney and CPA, David W. Klasing offers businesses and individuals a wide variety of legal services to protect their financial interests while ensuring compliance with the law. Equipped with more than 20 years of combined experience, our dedicated team of accountants and litigators is committed to providing our clients with aggressive legal representation, and even more importantly, priceless peace of mind.
Our Los Angeles tax law firm attorneys have extensive experience consulting with businesses and individuals across a wide range of general tax planning and litigation matters, including:
Los Angeles Tax Attorney FAQs
How do Los Angeles tax regulations differ from other cities or states?
Los Angeles tax regulations, mainly similar to the rest of California, carry some unique attributes compared to other cities and states. For the 2022 tax year, California’s state income tax employs nine brackets ranging from 1% to 12.3%, a structure more progressive than many states. Moreover, California levies an additional 1% mental health services tax on income exceeding $1 million, raising the effective top tax rate to 13.3%, one of the highest in the nation.
Individuals meeting specific criteria in Los Angeles may be obliged to contribute to the Alternative Minimum Tax, currently fixed at 7%. Moreover, those whose taxable income surpasses $1 million are liable for an additional 1% Mental Health Services Tax on the exceeding amount. Generally, residents of Los Angeles fulfill their California Resident Income Tax Return obligations via Form 540. Not meeting any portion of their state or federal tax responsibilities may result in a deficiency notice, tax audit or criminal tax investigation from the corresponding federal of California tax agency.
The base California sales tax rate stands at 7.25%. However, an additional 0.25% countywide tax applies in Los Angeles County, plus variable city and local sales taxes. These local levies can push the total sales tax in some areas of Los Angeles up to 10.5%, which is higher than 97% of California counties and 96% of counties nationwide. Additionally, homeowners in Los Angeles are subject to a countywide property tax rate of 0.82%, and depending on the city or district they reside in, they may be liable for additional local rates.
Finally, Los Angeles residents with international financial interests are subject to federal and international tax regulations, such as FBAR and FATCA requirements. These regulations necessitate the disclosure of foreign accounts surpassing certain thresholds. Penalties for non-compliance with these offshore disclosure obligations can be substantial, highlighting the importance of understanding and abiding by these regulations for Los Angeles residents with international income or assets.
Why do I need a tax attorney in Los Angeles?
Acquiring the services of a seasoned Tax Attorney in Los Angeles is critical when navigating the multifaceted tax law landscape. At the Tax Law Offices of David W. Klasing, our team comprehensively represents clients through all tax procedure phases, including interactions with the IRS, the California Franchise Tax Board, the State Board of Equalization, CDTFA, and the Employment Development Department. We provide high-quality representation utilizing profound, intricate tax law and procedure knowledge.
Unlike general legal practitioners, we focus on tax planning, compliance and controversy matters, from individual and business tax planning to offshore asset concerns, voluntary disclosures, IRS audits, and disputes with state or local taxing authorities and California Income Tax Audits. Our representation spans financial products, partnership issues, tax accounting, tax credit qualifications, gift and estate taxes, excise taxes, employment and worker classification matters, international tax treaty, withholding tax issues, and state and local taxes.
While we prioritize administrative resolution and settlement when possible, we also stand prepared to defend your rights in court if necessary. Our litigators adeptly translate our firm’s substantive knowledge into robust courtroom strategies in the Los Angeles Superior Court, Federal District Court for the Central District of California, and Ninth Circuit Court of Appeals. Leveraging our winning strategy ensures you get the best possible outcome in your tax matters.
How much does a tax attorney’s services cost in Los Angeles?
In Los Angeles, the cost of a tax attorney’s services at the Tax Law Offices of David W. Klasing offers a unique blend of upfront and long-term value. We provide the combined expertise of a tax attorney and a CPA at a single price point, creating a cost-effective solution for your complex tax issues. Our billing system, reflecting hourly rates appropriate to the staff level providing you services, ensure your case is delegated to the professional offering the most value at the lowest cost within our team.
We ordinarily commence our professional relationships with our L.A. client via a 10 minute or one-hour, reduced-rate initial consultation, which can be conducted in person in Irvine, California, or by phone or virtually via encrypted Go To Meeting video conferring. This introductory meeting lets us understand your needs and estimate a reasonable range of what our services will likely cost you in your specific situation. Additional sessions at our Los Angeles office may be arranged based on your case’s complexity.
We have a set of policies to curb additional travel-related costs. We aim to resolve tax issues by correspondence with taxing authorities or relocating your case to a local office whenever possible. If in-person interaction is necessary, we strive to limit travel expenses and time. With David Klasing’s private pilot license, we can conveniently reach remote client locations across Southern California via air travel without charging these costs to our clients.
We emphasize the long-term value provided beyond the immediate costs. The expertise of a proficient tax attorney can help prevent costly errors that could lead to additional tax assessments over time while ensuring stress-free navigation of tax disputes. We accept cases only if we can significantly improve your situation and justify our fees. This extends to clients who wish to dispute an IRS tax audit outcome, where our seasoned dual-licensed Tax Attorneys and CPAs can guide you through the appeal / litigation process if we expect it will be financially beneficial to you.
At the Tax Law Offices of David W. Klasing in Los Angeles, we routinely prioritizing your rights and financial interests over our inherent need to earn a living. For more information or to schedule an appointment, don’t hesitate to contact us at (310) 492-5583.
How can I schedule a consultation with tax attorneys and CPAs in Los Angeles?
To schedule a consultation with our dual-licensed Tax Attorneys and CPAs in Los Angeles, follow these steps:
- Call Us: Reach out to our Los Angeles office at (310) 492-5583 during regular business hours, and our team will assist you in scheduling your consultation.
- Online Form: Visit our website and complete the confidential form. Our team will get back to you promptly to confirm your appointment.
We offer various options for consultations:
- Quick Reduce Rate Initial Phone Consult: A 10-minute phone consultation priced at $75. David Klasing or a suitable staff member will call you at the scheduled time.
- Reduced Rate GoToMeeting Virtual Initial Consultation: A 60-minute virtual meeting priced at $450. It requires a device compatible with GoToMeeting. All appointments are secure and encrypted.
- Reduced Rate Initial Phone Consult: A 60-minute phone consultation priced at $425.
Note: Please allow a 15-minute window following the appointment time for us to start the meeting or call. Any excess consultation time paid for but not received will be refunded.
You can find us at 10940 Wilshire Blvd. Ste 1600 Los Angeles, CA 90024, but remember that this is an appointment-only satellite office. We look forward to assisting you with your tax issues.
Can the IRS revoke my passport because I owe back taxes, and how can your Los Angeles tax attorneys help?
Yes, the IRS can revoke your passport if you owe more than $59,000 (an amount adjusted yearly for inflation) in taxes, which can include penalties and interest. This provision is part of the Internal Revenue Code’s Section 7345, introduced by the Fixing America’s Surface Transportation (FAST) Act or H.R. 22, signed into law in 2015. It comes into effect if you fail to respond to the IRS’s Notice of Federal Tax Lien or a tax levy.
If you disagree with the tax amount or believe the certification was made in error, we can help you address this with the IRS. You must respond promptly to Notice CP508C from the IRS and provide proof of payment if you have already settled your tax debt.
If you cannot pay your tax debt in full, we can assist you in making alternative payment arrangements, such as an Installment Agreement or an Offer in Compromise. Such arrangements can lead to reversing your certification, thereby safeguarding your passport.
In cases where you have a tax refund, the IRS will apply it toward your debt. If the refund covers your seriously delinquent tax debt completely, the IRS will consider your account fully paid once the return and refund are processed.
Additionally, if you need your U.S. passport for employment purposes, we can help expedite the resolution of your tax issues. Once your seriously delinquent tax debt is either fully paid or an alternative payment arrangement is in place, the certification to the State Department can be reversed, enabling you to retain or renew your passport.
Remember, if you’re a taxpayer traveling abroad for work or pleasure, these provisions may impede your ability to travel outside the United States. If you’re outside of the U.S., you may be required to return if your passport is revoked or limited.
Certain exemptions can apply, including when you’ve entered an IRS installment agreement, settled your tax debt through an Offer in Compromise, or filed for innocent spouse relief. Contact our Los Angeles office at (310) 492-5583 for expert advice tailored to your situation.
- IRS Audits
- Awards and Settlements
- Bookkeeping Accounting
- California Sales Tax
- Eggshell and Reverse Eggshell Audits
- Employment Tax Representation
- IRS Field Audits
- Innocent Spouse Relief
- Tax Transactions
- Business Law
- Criminal Tax Defense
- Domestic and International Estate Planning
- International Tax Law
- IRS Appeals
- Non-Filer Assistance
- Tax Planning and Preparation
- Tax Services for Clergy
- Voluntary Offshore Disclosures
Why You Should Hire a Los Angeles Dual Certified Tax Attorney and CPA
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