The U.S. Internal Revenue Code (IRC) is over 70,000 pages long, and it is filled with countless laws and regulations that individuals and entities are required to comply with. Americans are rightfully frustrated with the complexity of our tax laws, and it is no wonder that so many taxpayers end up having problems.
Being out of compliance with the IRS and state taxing authorities is a dangerous place to be and doing nothing about it can result in severe consequences. This may include tax liens, bank account levies, seizure of property, and even the closure of your business. With so much at stake, you cannot afford to leave this situation to chance. You need experienced attorneys in your corner who thoroughly understand federal and state tax laws, and what is necessary to successfully resolve your tax controversy.
Since 1959, the attorneys at Haygood, Cleveland, Pierce, Thompson & Short, LLP, have assisted clients facing various types of tax issues in Auburn and nearby Alabama communities. Our lawyers have extensive knowledge of several practice areas, and we work collaboratively to develop comprehensive solutions that fully address the legal needs of our clients. We know the ins and outs of the tax laws, and how these laws converge with other areas of the law.
Our primary focus is on the needs of our clients. We take pride in providing our clients with exceptional legal services, ongoing communication, and skilled representation. Our seasoned attorneys have distinguished educational backgrounds and years of experience. As a team of legal professionals, we are committed to obtaining successful results for each client and case we undertake.
We handle a full range of tax issues for individuals and entities, this includes but is not limited to:
- Income Tax Audit Representation
- IRS and Alabama State Tax Debt Relief
- S. Tax Court and State Tax Court Litigation Representation
- Tax Preparer Representation
- Criminal Tax Defense Representation
- Civil Penalty Abatements and Innocent Spouse Relief
- IRS Administrative Appeals
- Alabama State Tax Audits, Appeals, Litigation, and Tax Debt Relief
- Payroll and Business Tax Issues
- Non-Profit/Tax-Exempt Organization Formation and Compliance
IRS and Alabama Income Tax Audit Representation
There are few events in life that are scarier than facing an audit from the IRS or the state of Alabama. The taxing authorities have virtually unlimited resources, and when they set their sights on a taxpayer, they have the ability to cripple them financially. Representing yourself in an audit can be very risky for a number of reasons, here are some of the most important:
- You might inadvertently take steps that could make the situation worse, such as destroying records;
- You might accidentally provide the governing agency with more information than you were required to give, which could put you in further danger;
- You may miss important deadlines and/or fail to prepare all the paperwork properly;
- You might not recognize when your legal rights are being violated by an auditor;
- You may not know how to take advantage of various programs or legal strategies designed to minimize the negative consequences of an audit.
There are two different types of audits you may be subjected to; written or face-to-face audits. The majority of IRS audits are written and typically involve a request for further documentation to help substantiate a claim made on your tax return. Written audits are not as scary, but it is still advisable that you seek counsel to help ensure that you are providing the right documentation, and that the situation can be resolved before it escalates.
If you are contacted for a face-to-face audit, it is very important to have a strong legal professional in your corner who is familiar with the process. Keep in mind that the main purpose of an audit, from the standpoint of the taxing authority, is to generate additional tax revenue. And if you don’t have someone there looking out for your interests, agents are far more likely to overstep their legal boundaries in order to accomplish this goal.
The tax audit is not necessarily the end of the road. If you are not happy with the results, you have the right to request an administrative appeal. Requesting an appeal can be a gamble, however, because it could backfire and result in you owing more money. For this reason, you should never take this route unless your attorney advises it. If an administrative appeal proves unsuccessful, you can take your case to tax court. This, again, is not something you should consider without the guidance of an experienced attorney.
Do You Owe Money to the IRS?
If you have IRS tax debt, it is important to take proactive steps to resolve this issue before the agency takes further collection action. Fortunately, there are some options to explore that could potentially reduce your debt. These include:
- Offers in Compromise: You may have heard the TV or radio commercials saying that they can settle your IRS tax debt for “pennies on the dollar”. What they are talking about is an Offer in Compromise. Unfortunately, many of the companies that advertise this service are simply “offer mills” that make thousands of offers a month with most of them being rejected because they spend very little time on the case and present a very weak offer. The truth is that an Offer in Compromise can allow you to settle your tax debt for significantly less than the full balance, but you must be able to demonstrate to the IRS that accepting the offer is in their best financial interests. This is done by showing that the IRS is better off accepting your offer than continuing collection activity on the account over the years remaining on the statute of limitations.
- Installment Agreements: As the name implies, an installment agreement is an agreement to pay your tax debt in a series of installments over a set number of months, with a maximum of three years to pay off the debt. This arrangement may make sense if the lump sum you owe is beyond what you can afford. To qualify, a taxpayer must owe less than $50,000 (not including penalties and interest), have filed tax returns, paid taxes owed, and not entered into a prior installment agreement for the past five years, and demonstrate that they are unable to pay their tax debt on the date due or within 120 days.
- Uncollectible Status: If you have fallen on financial hardship and you have no ability to pay your IRS tax debt, you can apply to have it placed in “Uncollectible Status”, also known as “Status 53”. If you are approved, the IRS temporarily halts collection activity until you are able to regain your financial footing. Uncollectible status is not a permanent solution, but it can buy you some much-needed time to get your financial house in order.
Speak with a Skilled Alabama Tax Lawyer
If you have any type of IRS or Alabama tax issue, Haygood, Cleveland, Pierce, Thompson & Short, Attorneys at Law is ready to help. To schedule an initial consultation with one of our attorneys, call our office today at 334-821-3892. You may also send a secure and confidential message through our web contact form or stop by our Auburn office at your convenience.
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