One of the Best Tax Audit Defense Lawyers and CPAs in Oakland
In California, there are four major tax authorities that perform tax audits: The Internal Revenue Service (IRS), the California Department of Tax and Fee Administration (CDTFA), formerly known as the BOE, the California Franchise Tax Board (FTB), and the California Employment Development Department (EDD). All four of these agencies have the power to assess additional tax and impose civil penalties and interest. More worryingly for taxpayers, they can also collaborate with law enforcement agencies to investigate crimes like tax evasion.
If you have received an audit notice from the IRS, the FTB, the EDD, or the CDTFA the clock is already ticking. Don’t wait to begin preparing. Instead, ask the A+ BBB rated Oakland tax audit lawyers at the Tax Law Office of David W. Klasing how we can assist. Not only is David W. Klasing an award-winning tax attorney – he is also a former public auditor, giving our tax team priceless insight into audit techniques and how to handle them efficiently. Additionally, Mr. Klasing is dually licensed as an Attorney-CPA, affording taxpayers the attorney-client privilege accountants cannot provide. Additionally, he has a perfect 10 AVVO rating and over 20 years of tax controversy experience and has earned a master’s degree in taxation. If you, your spouse, or your business is being audited in Oakland, contact us today to learn how we can help.
Why Am I Being Audited by the IRS or California State (FTB, CDTFA, EDD)?
Tax audits can have dozens of different causes, ranging from how much income an individual earns to what sort of service a business owner provides. In general, audits are conducted for one of three reasons:
- A taxpayer or business has traits, or engages in behaviors, the tax authority deems risky or suspicious. Examples of this could include:
- Being self-employed
- Conducting most transactions in cash
- Having a high net worth, or earning a large salary
- Owning a business in certain industries, notably real estate, dentistry, auto sales, and veterinary care
- The tax authority detects anomalies or errors, often on an income tax return, but potentially on other tax documents as well. Examples of this could include:
- Claiming tax credits, deductions, or exemptions improperly
- Failing to file tax returns
- Leaving parts of a tax return blank
- Losing or destroying records
- Padding (exaggerating) business expenses
- Underreporting income, or making other false statements on a tax return
- The taxpayer is randomly selected by computer software.
Different Types of Audits
Audits generally fall into one of three categories. Differentiating between these categories is important, because each type of audit carries different implications, similar to the way a felony charge has different implications than a misdemeanor charge. While all audits are cause for concern, some demand particularly sophisticated defense strategies due to their complexity – and their potential to harm the taxpayer.
The first type of audit is called a “correspondence” audit, so-named because the audit is carried out through the exchange of letters and notices. For example, the auditor might send the taxpayer a letter asking him or her to supply specific financial documents. This may be adequate to resolve the issue, though as the IRS cautions, “A correspondence audit can expand… particularly if the issues grow more complex or the [taxpayer] does not respond.”
The second type of audit is called an “office” audit, because the examination takes place at an IRS office – frequently over the course of a single day, though the auditor may extend the process by asking for additional documentation. There are numerous IRS, CDTFA and FTB offices dispersed throughout California that are in Oakland California.
The Oakland IRS office is located at:
1301 Clay Street
Oakland, CA 94612
The Oakland CDTFA office is located at:
1515 Clay St., Ste. 303
Oakland, CA 94612-1432
The Oakland FTB office is located at:
1515 Clay St
Oakland, CA 94612
The third type of audit is known as a “field” audit, for reasons no taxpayer wants to hear: the auditor comes to the taxpayer’s home and/or business – the “field” – in pursuit of records and statements. If the tax authority is conducting a field audit, it means that the taxpayer’s net worth and liberty may be at risk for two reasons:
- Field audits are deeper and more comprehensive than other types of audits.
- Field audits are only performed in situations where the IRS, FTB, CDTFA or EDD believes the taxpayer may have made serious, extensive errors – potentially in a deliberate effort to thwart the Tax Code.
Eggshell Audits and Criminal Tax Investigations
The term “eggshell” audit is a term of art that describes any civil audit in which the taxpayer is being examined for major errors. If the taxing authority proves a taxpayer acted willfully (as opposed to carelessly), he or she can face criminal tax penalties, depending on whether the audit gives rise to a criminal tax investigation and subsequent prosecution.
Like field audits, eggshell audits are reserved for situations where the IRS is reasonably confident that fraud (or extensive negligence) occurred. The auditor will be searching carefully for “badges of fraud” that indicate willful or criminal behavior – for instance, deliberate failures to file returns, report business income, or disclose the existence of foreign bank accounts and unreported taxable sources of offshore income.
Related to the eggshell audit is the equally perilous “reverse” eggshell audit, in which civil and criminal investigations are conducted simultaneously. In this situation, the taxpayer will generally not be notified that a criminal investigation is simultaneously pending, depriving the taxpayer of vital opportunities to protect him - or herself against self-incrimination and unreasonable searches and seizures.
Oakland Tax Audit Attorneys for Businesses and Individuals
The Tax Law Office of David W. Klasing is based in California, but our diligent tax professionals have earned national recognition for our skillful, effective handling of even the most complex tax cases. Our tax audit lawyers and CPAs available in Oakland, California have represented thousands of individuals, corporations, partnerships, LLCs, and sole proprietors in tax audits of all types, and are thoroughly prepared to meet any challenge head-on.
Our knowledgeable attorneys have experience handling a vast array of audits and audit-related legal issues, including IRS audits, FTB audits, CDTFA audits, EDD audits, employment tax audits, foreign account and FBAR tax audits, and worker classification audits. Additionally, our criminal tax attorneys are prepared to zealously defend taxpayers against misdemeanor or felony charges arising out of an audit or criminal tax investigation. Furthermore, we are qualified to assist taxpayers in filing written protests or tax court petitions, which are used to challenge (“appeal”) questionable audit results. Finally, should the audit result in the assessment of additional tax or penalties, we can work to negotiate a reasonable payment plan or installment agreement, which can help the taxpayer avoid liens, levies, garnishments, and other unwanted consequences of tax debt.
No matter how overwhelmed you may feel or how high the stakes may be, you have an ally in our zealous taxpayer advocates. To speak with our Oakland tax audit lawyers and CPAs in a reduced-rate consultation, call (510) 764-1020 or (800) 681-1295, or contact the Tax Law Office of David W. Klasing online.
Oakland Tax Law Offices
For any of your tax planning compliance and controversy needs in Oakland, contact the Lawyers at The Tax Law Offices of David W. Klasing today. Our experienced Tax Lawyers offer a reduced-rate consultation on new cases or engagements. Call (510) 764-1020 or 800-681-1295 or contact us online today to schedule a reduce rate initial consultation at our Oakland tax law offices, or at one of our other convenient locations across Southern California.