Orange County Tax Litigation Attorney
When an IRS audit concludes, you do not have to accept the results unquestioningly. Instead, you can either agree or disagree with the examination's findings. If you agree, you can sign the appropriate form and pay what you owe to complete the process. But if you disagree, you can appeal the initial decision and bring the matter to federal or California state courts. In Orange County, tax litigation can involve civil and latent criminal tax matters. It can be heard in venues that include the U.S. Tax Court, U.S. District Court, U.S. Bankruptcy Court, and California Superior Court. Tax controversies can arise when a federal or California tax agency, such as the IRS, FTB, EDD, or CDTFA, believes tax is owed on some level, and a taxpayer or company may feel otherwise. Similarly, a tax dispute can ensue when taxpayers believe a refund is owed.
Tax litigation is the process by which questions involving civil tax disputes that can involve potential latent criminal tax matters are presented, reviewed, and decided in the appropriate venue. When you face criminal tax exposure or need guidance regarding a civil tax audit, eggshell audit, reverse eggshell audit or criminal tax investigation, consulting an experienced Tax Litigation Attorney with extensive criminal defense tax training and experience is invaluable. Being well-informed and prepared can make all the difference in resolving these issues. During the auditing and appeals processes and any subsequent tax court litigation that may arise, you have the right to be represented by a qualified dual licensed Tax Attorney-CPA familiar with the legal and financial complexities of tax matters.
David W. Klasing, a dual-licensed attorney-CPA having earned a Master's in tax, is among an elite group of approximately 3,000 professionals in the country possessing similar credentials. With 1.1 million attorneys, 560K CPAs, and only 24K dual-licensed attorney-CPAs nationwide, David's unique skill set sets him apart from the competition. He served 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. David has over 20 years of experience helping taxpayers minimize their liabilities while efficiently resolving IRS disputes. His long history of wins for clients, impeccable ethical standards, and honesty make him a reliable choice for representation. To arrange an initial consultation with an Orange County tax litigation attorney at the Tax Law Offices of David W. Klasing, call us at (800) 681-1295 today.
Is Mediation or Litigation Right for You?
Tax Litigation is an aggressive measure that can be an obvious, decisive, and effective method of resolving ongoing IRS disagreements. However, this process also has the potential to become a costly and time-consuming endeavor. Therefore, before selecting litigation as your legal strategy, you may want to consider the less drastic mediation alternative.
Mediation effectively takes the opposite approach of litigation by encouraging participants to work together toward their own mutually agreeable solution with the help and guidance of a qualified mediator. Mediation grants participants more significant personal input and tends to be more informal, rapid, and cost-effective than litigating a case. Another important distinction is that while a judge's decision is legally binding, a mediation plan is not.
The Appeals Office offers several different mediation options as part of the Alternative Dispute Resolution (ADR) program. Depending on your classification as a taxpayer and which stage of the IRS process you have reached, you may be an ideal candidate for the following:
- Compliance Assurance Process (CAP): Pre-Filing stage, available to international and large businesses;
- Early Referral: Examination stage, available to international and large businesses, small businesses, self-employed taxpayers, and tax-exempt and government entities;
- Fast Track Mediation: Collection stage, available to small businesses and self-employed taxpayers;
- Fast Track Settlement: See Early Referral guidelines;
- Post-Appeals Mediation: Appeals stage, available to international and large businesses, small businesses, self-employed taxpayers, and tax-exempt and government entities.
In addition to mediation, the IRS Appeals process can be a viable option for resolving tax disputes without litigation. The California Office of Appeals also offers a similar approach for state tax disputes. It's essential to understand the differences between the expedited appeals process and the regular appeals process when considering your options.
The expedited appeals process typically involves the auditor, their manager, and an appeals officer. However, this method may be less effective because the auditor and their manager are emotionally invested in the audit results, often leading to a negotiation power imbalance in the governments favor.
On the other hand, the regular appeals process is initiated by filing a tax court petition. It involves an independent review of the taxpayer's case by an appeals officer not involved in the initial audit. The IRS auditor and their manager are not directly involved in this process. The appeals officer will independently consider the taxpayer's arguments and supporting evidence, attempting to reach a resolution that also weighs the hazards of litigation for the IRS in the client's specific situation. If the appeals process does not result in a solution, the taxpayer has a second opportunity to settle with IRS Chief Counsel's office on the Tax Court steps.
Similarly, the California Office of Appeals offers a similar process for resolving state tax disputes. This independent, impartial body reviews tax controversies involving the California Franchise Tax Board (FTB), Employment Development Department (EDD), and California Department of Tax and Fee Administration (CDTFA). Like the IRS Appeals process, the California Office of Tax Appeals (OTA) provides a less adversarial and more cost-effective alternative to litigation, enabling taxpayers and tax agencies to resolve disagreements through a structured administrative process.
Our Orange County dual-licensed tax litigation Attorneys & CPAs at the Tax Law Offices of David W. Klasing are committed to helping taxpayers navigate the complexities of tax deficiency disputes and tax refund litigation. Considering the IRS's 98% settlement rate, reaching a mutually acceptable solution outside of court is often the most efficient and cost-effective approach for both parties. Our strategic approach to tax litigation prioritizes resolving disputes through negotiation, and other alternatives to litigation whenever possible. We take pride in our track record of successfully negotiating settlements with the IRS and other tax agencies and our commitment to providing personalized and effective representation for our clients.
We have rarely stepped foot in Tax Court, sparing our clients the most expensive part of tax litigation. We firmly believe in exploring alternative means of dispute resolution to serve your best interests. However, if litigation becomes necessary, our experienced tax litigation attorneys will advocate fiercely on your behalf, working tirelessly to achieve the best possible results. Trust us to guide you through the often-challenging landscape of tax disputes and litigation in Orange County.
Challenging an IRS Audit in Tax Court
Mediation is an ideal solution for some taxpayers, but not all. However, there are specific steps you must go through before you can bring your dispute to U.S. Tax Court or the relevant California state tax court.
Suppose you disagree with the results of an IRS audit. In that case, the first step is to hire an experienced Orange County tax litigation attorney totypically file a formal written protest, which should contain information including but not limited to:
- A statement that you wish to appeal the examination findings;
- A list of the proposed items you want to dispute;
- The facts and laws which support your argument;
- An explanation of why you believe the proposed changes are incorrect;
- Any relevant documentation or evidence to support your position;
- A request for an appeals conference, if desired.
Typically speaking, this written protest must be filed within 30 days of the date on the letter containing the audit's findings, often called the 30-day letter. After an examination, if there are any proposed changes, the IRS agent sends the taxpayer an examination report outlining the changes made to the tax return and a letter notifying the taxpayer of their right to appeal the proposed changes within 30 days. An appeal typically involves a conference with an IRS Appeals Officer and filing the formal written protest stating which offered changes the taxpayer disagrees with and the reasons for the disagreement. If you cannot reach an agreement through Appeals within that time or do not respond, you will receive a 90-day letter or Notice of Deficiency. You then have 90 days to petition the Tax Court for an external review of the findings. If the taxpayer does not respond to this 90-day letter, the amount on the notice of deficiency will be assessed regardless of whether the proposed changes were made in error. However, it should be noted that an appeals officer will often evaluate to determine whether a settlement can provide a resolution before the tax court hears the case.
Suppose your dispute involves an amount less than $50,000, including tax, interest, and penalties. In that case, you may be eligible to use a special set of simplified court procedures, known as the Small Tax Case procedure or "S case." This process offers a more informal and expedited resolution to your tax dispute. However, if you elect to use the simplified process, you will lose your ability to appeal any decision rendered by the Tax Court.
The Small Tax Case procedure is designed to make the tax court more accessible for taxpayers with minor disputes, allowing them to present their cases without extensive legal knowledge or representation. During these proceedings, the taxpayer and the IRS present their arguments directly to a tax court judge, who will often decide immediately after hearing the case. This streamlined process can benefit taxpayers seeking a quicker resolution to their tax disputes. However, it's important to remember that choosing the Small Tax Case procedure may not always be the best option, especially if you believe the outcome could be unfavorable and may require an appeal. Consulting with our experienced dual-licensed Tax Attorneys and CPAs can help determine whether the simplified court procedures suit your situation.
If you are engaged in a dispute with the IRS, the experienced litigators at The Tax Law Offices of David W. Klasing can advocate helping resolve the issue. Our dual-licensed tax litigation Attorneys and CPAs represent clients in Orange County and beyond during all phases of the tax dispute process, including audits, litigation before the U.S. Tax Court, trial courts, and appellate courts. Our practice extends beyond federal income tax matters, handling California state and multistate audits, and representing clients before the California Franchise Tax Board, the State Board of Equalization, CDTFA, and the Employment Development Department. We strive to provide our clients with a careful and thoughtful strategy to manage the audit and achieve a successful result, prioritizing settlement when possible and standing ready to defend your rights in administrative hearings or trials when necessary. To set up a reduced-rate initial consultation with an Orange County tax litigation attorney, call us at (949) 681-3502 or (800) 681-1295, or contact us online today.
Orange County Tax Law Offices
Navigating tax disputes can be complex and challenging, but the experienced team at The Tax Law Offices of David W. Klasing is here to guide you through every step. Unlike general litigation firms, which may lack detailed knowledge of tax law and procedure, our dual-licensed tax litigation Attorneys and CPAs specialize in tax controversies, ensuring you receive the highest caliber of representation.
We will primarily focus on alternative dispute resolution methods, such as mediation, negotiation, and IRS Appeals. These enable us to resolve tax disputes efficiently and cost-effectively without litigation whenever possible. To date, we have never stepped foot in Tax Court, sparing our clients the most expensive aspect of litigation. Our in-depth understanding of tax law and familiarity with tax dispute procedures allow us to offer personalized, strategic advice, guiding you through the complexities of audits, tax court proceedings, and California state tax matters.
With a proven track record of successfully negotiating settlements with the IRS and other tax agencies, you can have confidence in our ability to advocate fiercely for your best interests should litigation become necessary. Even a simple mistake or misinterpretation of the tax code can result in litigation, fines, and penalties, making the assistance of a knowledgeable professional crucial for achieving a favorable outcome in your case. We will thoroughly review your case, assess your rights and options by examining your tax returns and financial records, and guide you through IRS or California state tax audits. We will address any notices of deficiency and evaluate the merits and strengths of your case to help you contest a deficiency, pursue a refund, or resolve other tax dispute issues.
For any tax planning compliance and controversy needs in Orange County, contact the dual licensed Attorneys and CPAs at The Tax Law Offices of David W. Klasing today. We offer a reduced-rate consultation on new cases or engagements. Call (949) 681-3502 or 800-681-1295 or contact us online today to schedule a reduced rate initial consultation at our Orange County tax law offices or one of our other convenient locations across Southern California. Our Orange County (main office) is conveniently located at:
2601 Main St. Penthouse Suite
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More Commonly Asked Tax Audit Questions
- How should Tax Audits be Handled by Criminal Tax Counsel?
- How to survive audit when I cheated on return being audited
- What is an eggshell audit?
- What is a reverse egg shell audit?
- Why is a reverse egg shell audit dangerous for a taxpayer?
- Warning signs of a criminal referral from an IRS audit
- Effective tax defense counsels goals in an egg shell audit?
- How are the 4 goals and outcomes 1 and 2 best obtained?
- What are the possible outcomes of an egg shell audit?
- Is it my right to know why I was selected for examination?
- What can I do to prepare for an audit?
- What is an IRS civil examination?
- How IRS decides which tax returns are audited
- What are my appeal options if I disagree with IRS?
- What are my basic taxpayer rights if the IRS audits me?
- Options if I am unable to pay at the conclusion of audit
- What a 30 or 90-Day Letter from the IRS means
- What is involved with appealing disagreements?
- Rights to disagree with IRStaxauditor’sss findings
- Can I stop the IRS from repeatedly auditing me?
- Can I have the examination transferred to another area?
- Can I record my IRS interview and is it a good idea?
- How many years of returns are at risk during an audit?
- Common reasons for the IRS to conduct a tax audit
- How to avoid negative consequences from an IRS interview
- Have to agree to interview by taxing authority directly?
- Are all audits the same?
- What should I do if the IRS is investigating me?
- What ifIdon’ttt respond to a taxing authority audit notice
- Your rights during an IRS tax audit
- Risks of attending an IRS audit without a tax lawyer
- Most common audit technique used by taxing authorities
- Don’t go into an IRS audit without representation
- Why hire an attorney to represent me in an audit?
- Why hire David W. Klasing to represent me in an audit
California Sales Tax Questions and Answers
- Common issues encountered during sales tax audit
- What is a sales tax audit?
- Disagreeing with business audit conclusions
- Timeline to file Petition for Redetermination?
- What should Petition for Redetermination contain?
- Is the appeals conference formal or informal?
- Appeals Division’s Decision and Recommendation
- Are a mark-up percentage and a profit margin the same?
- Problems with the mark up audit
- Can State Board of Equalization ignore my business records
- What is a sales tax deficiency determination?
- Business being audited for sales tax. Should I be worried?
- Audit determined fraud to avoid sales and use tax
- Definition of “sale” for California Sales Tax
- What do California sellers need to know about sales tax?
- How do I apply for a sellers permit?
- What are my obligations as a permit holder?
- What is sales tax?
- What is tangible personal property?
- What is a sale?
- What are total gross receipts?
- What is use tax?
- Who is responsible for paying the use tax?
- Who is a retailer engaged in business in California?
- Who is a qualified purchaser?
- Do I need a Certificate of Registration Use tax?
- Do I need a Use Tax Direct Payment Permit?
- What types of sales are exempt from sales tax?
- How are Internet Transactions Taxed?
- How is California sales or use tax determined?
- What is the statewide sales and use tax rate?
- Are there other local and district sales and use taxes?
- Total sales and use tax rate calculation
- How to protect against successor liability in California
- Recourse when issued California sales tax liability notice
- CA Sales Tax liability extend to purchasers/successors?
- Waiting Until Audited to Take Action on Tax Matters
- Sales tax records needed in California
- What are California’s sales and use taxes?
- Why does the State of California audit businesses to ensure compliance with sales and use taxes? How does the State determine whether to audit my business?
- The BOE reviews the purchase invoices of my business
Questions and Answers for Criminal Tax Representation
- When tax defense counsel parallels tax crime investigation
- Guilty of tax obstruction by backdating documents?
- To be found guilty of tax obstruction must a person actually be successful in impeding the IRS’s functions?
- Help! The Document I Gave the IRS Had False Information
- Tax crime aiding or assisting false return IRC §7206(2)
- What is the crime known as tax obstruction § 7212?
- What is the difference between tax perjury and tax evasion?
- What is the tax crime commonly known as tax perjury?
- What is a Klein Conspiracy?
- Increased possibility of civil action in IRS investigation
- Am I Guilty of Tax Evasion if the Law is Vague?
- What happens if the IRS thinks I committed tax crimes?
- What are ways to defend against a tax evasion charge?
- Difference between criminal tax evasion and civil tax fraud
- What accounting method does the IRS use for tax fraud
- Can I Change Accounting Method to the Accrual Method
- What is the willfulness requirement for tax evasion?
- I didn’t know I committed tax fraud. Can I get off?
- Concealed assets from IRS. Can I avoid tax evasion charges
- How government proves I willfully engaged in tax evasion
- What is the venue or court where a tax crime case is heard?
- Must the IRS prove tax crimes beyond a reasonable doubt?
- Is it a crime to make false statements to the IRS?
- Will the IRS overlook my tax evasion if it’s minor?
- Failed to tell IRS about my nominee account
- Audit risk with cash based business transactions
- How to defend a client charged with tax evasion
- Is it tax evasion if I didn’t file income tax return?
- Government says I attempted to evade my taxes. Now what?
- I forgot to pay my taxes or estimated tax. Is this a crime?
- Government proof I “willfully” failed to pay taxes
- 5 Ways to Respond to Tax Evasion Charges
- Being audited after using a tax professional
- Rules for what an IRS agent can do while investigating me
- How tax preparers, attorneys and accountants are punished
- How the IRS selects tax crime lead for investigation
- How does the IRS prosecute suspected tax crimes?
- Does IRS reward informant leads for suspected tax crimes?
- How the government proves deficiency in a tax evasion case
- Do prior tax crimes factor into new IRS tax convictions?
- Requesting conference before investigative report is done
- Requesting conference after IRS Special Agent Report
- What are my rights during an IRS criminal investigation?
- Avoid prosecution for tax crime with voluntary disclosure?
- Defense tactics that make it hard for to prove willfulness
- How a tax attorney can stop your criminal tax case?
- What can you generally tell me about tax crimes?
- Continuing filing requirement with investigation pending
- Federal criminal code crimes that apply to tax issues
- Penalty for making, subscribing, and filing a false return
- CID special agent’s report for criminal prosecution
- What is the discovery process in a criminal tax case?
- What the IRS includes in indictment for tax case
- What is the hardest element of a tax crime to prove?
- IRS methods of gathering evidence to prove tax crime
- What does a grand jury do in IRS tax crime prosecution?
- Failure to keep records or supply information
- Failure to make a return, supply information, or pay tax
- What is attempting to evade payment of taxes?
- What is income tax evasion and how is it punished?
- What is attempted income tax evasion?
- What is the crime of failure to pay tax? What is punishment
- Crime of making or subscribing false return or document
- Criminal Investigation Division investigation tactics
- Tax crimes related to employment tax forms and trust funds
- Tactics to defend or mitigate IRS criminal tax charges
- How the IRS generates leads about suspected tax crimes
- What is the crime” evasion of assessment” of tax?
- Specific examples of “attempting” to evade tax assessment
- What is the so-called Spies evasion doctrine?
- Does overstating deductions constitute tax evasion?
- Is it tax evasion if my W-4 contains false statements?
- IRC §7201 attempt to evade vs. common-law crime of attempt
- What are the penalties for Spies tax evasion?
- How government proves a taxpayer attempted tax fraud
- What is a tax that was “due and owing.”
- What is evasion of assessment for tax liability?
- Is evasion of assessment different from evasion of payment
- Does the IRS have a dollar threshold for tax fraud?
- What is the IRS burden of proof for tax fraud convictions?
- Are Tax Laws Constitutional?
- What is the source of law that defines tax evasion?
- Does section 7201 create two distinct criminal offenses?
- Does tax evasion definition include partnership LLC
- What if I helped someone else evade taxes?
- Is it illegal to overstate deductions on my tax return?
- Is it illegal to conceal bank accounts from the IRS?
- Do later losses justify prior deductions?
- Common reasons the IRS and DOJ start investigations
- What is the Mens Rea component of tax crimes?
- What is a proffer agreement and what are the risks?
- Why to have an attorney to review a proffer agreement
- Why enter into a proffer agreement?
- Limited use immunity from proffer agreements
- Difference between civil and criminal fraud allegation
Questions About Delinquent Payroll Taxes and Trust Fund Recovery Penalty
- What happens if an employer continues to incur new payroll tax liabilities?
- California Employment Taxes Basics
- How Does the IRS Develop an Employment Tax Fraud Case from the First Indication of Fraud to a Criminal Indictment?
- Can more than one person be considered responsible by IRS
- How unpaid employment tax payments are allocated
- When a corporate officer is considered a responsible party
- Examples of trust fund recovery penalty determinations
- Failing to pay employment taxes after notice is given
- How to determine responsible person for trust fund recovery
- Assessing trust fund recovery penalty and option to appeal
- What is the trust fund recovery penalty?
- What are the penalties for failure to pay employment taxes
- When am I considered liable for company’s employment taxes