In the event the IRS reviews your tax return and does not agree with its content, it will notify you that you can appeal the IRS changes to the United States Tax Court. Prior to a trial in Tax Court, you will have an opportunity to settle your issues in a conference with an IRS appeals officer. These conferences generally can be very successful for the taxpayer. Appeals to the United StatesTax Court prevent the IRS from any collection action against the taxpayer until resolved by the Tax Court.
The tax law is complicated. It consists of the Internal Revenue Code, Regulations, Revenue Rulings, as well as court cases. In order to insure that your tax matter is thoroughly dealt with, it is necessary to have a tax professional plead your case before the IRS. Signing documents without knowing their implications can affect you for many years. There is a Taxpayers Bill of Rights, so don't give up your rights without knowing what they are.
Failure to comply with state sales tax laws can result in serious punitive penalties. Many states treat failure to deposit sales tax receipts as a criminal offense. In many instances, the filing of a protest or appeal can diffuse a potential criminal situation.
Bankruptcy can discharge some income taxes in full if certain pre-conditions are met. These pre-conditions must be met before filing a bankruptcy petition. The pre-condition rules are complex and require the use and the knowledge of an attorney skilled both in bankruptcy and income tax law. Filing of a bankruptcy too early can result in not having income taxes discharged. Ask your bankruptcy lawyer if he is aware of the rules to discharge income taxes in bankruptcy.
One of the options a taxpayer has in dealing with his tax problem is the Installment Agreement. The Installment Agreement allows the taxpayer to pay an IRS debt over a period of time. The IRS may demand a larger payment over a shorter period of time than the taxpayer believes is reasonable. Negotiating the amount of the payment and the time period over which to make payments requires the knowledge of a skilled professional.
Another option in dealing with an IRS tax liability is an Offer in Compromise. The taxpayer can offer the IRS an amount less than is owed to settle his tax liability in full. The amount of the "offer" is based upon an IRS formula. The formula is a complex calculation and requires financial information on the taxpayer and his or her spouse if married. The processing of an Offer in Compromise by the IRS will stop collection activity by the IRS until the offer is accepted or rejected.
Failure to deposit withholding and social security taxes is a very serious offense to the IRS. The monies not deposited belong to other taxpayers. The IRS is required to refund or payout these taxes for the benefit of the other taxpayers, even though the amounts were not remitted. In certain instances, the amount of the payroll tax liability can be reduced if one is aware of the IRS rules, regulations, and procedures.
The Internal Revenue Code is a complex law requiring knowledge of how the IRS and the courts interpret its complex wording. A skilled tax professional can advise you of deductions you may not be aware of to reduce your tax liability. Professional tax return software can generate additional deductions the "over the counter" tax preparation programs do not.