As an estate planning practice, estate and gift tax planning, as well as generation skipping transfer taxation, is at the forefront of our tax practice. Our chief focus in the integration of tax planning and the appropriate estate planning instrument to minimize the risk of tax consequences.
In terms of general tax planning for individuals and business, the transfer of capital assets such as real estate and business assets gives rise to potential income tax consequences. Such taxes arise due to capital gains and depreciation recapture. The impact of taxation can be anticipated and minimized through the planning of "non-recognition exchanges," or deferral of the tax obligation. Proper planning can yield a considerable tax advantage.
Tax Examination and Collections
It is not uncommon to fall behind on tax reporting and payment. Given the complexities of the tax laws and their integration with our lives and businesses, it is easy to procrastinate. The mounting penalties and interest that follow drive some further into the seclusion of hoping the problem will go away.
IMPORTANT: In the experience of this office, the chief concern of the IRS is attaining taxpayer compliance - even if a taxpayer goes on owing taxes. Do not procrastinate with your tax issues. Do not ignore the taxman. Do not lie to the taxman. Do not ignore correspondence from the IRS, especially where it indicates proposed correction to erroneous reporting information or deficiency. If not timely dealt with, the proposed corrections will become permanent and there will be no recourse either with the IRS or the United States Tax Court. Penalties can be severe. Help is only a phone call away.
With the aid of experienced assistance, becoming tax compliant is far easier than many anticipate. For those who qualify, tax liability is reducible through the abatement of penalties, possible interest abatement and negotiated reduction of IRS balances through the "offer in compromise" program. However, these remedies require careful analysis of each taxpayer's particular situation. Serious question as to tax liability may arise due to an audit. In such case, audit defense, IRS Appeals and petition to the United States Tax Court are among the avenues for contesting such.
A major portion of tax law is dedicated to tax collections and "Collections Due Process." Where a tax amount cannot be paid in full and the liability is not subject to reduction, various payment arrangements and deferrals exist. One possibility is the IRS Form 1127 Application for Extension of Time for Payment of Tax Due to Undue Hardship.
While tax law is constantly under revision, generally, there is a threshold of $50,000 where tax collection practice and procedure changes. Balances greater than $50,000 will typically result in the issuance of a federal tax lien. However, there are discretionary remedies, for example, in the form of Withdrawal of the Notice of Federal Tax Lien (IRS Form 12277). As well, payment arrangements for amounts over $50,000 are possible, but require additional information reporting on the IRS Form 433-F, "Collection Information Statement."
IRS collection issues require immediate attention. Once the IRS issues a Final Notice of Intent to Levy, the taxpayer has only 30 days in which to take action to stop collection.
We offer a free consultation to learn about your tax situation. Call us today to discuss your tax compliance concerns.
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