Experienced Tax Attorney Serving All Of California
Allison Soares is a dedicated and professional attorney. She is responsive, knowledgeable, and a staunch advocate on behalf of her clients. She has a wealth of knowledge regarding both corporate law and tax law and willingly shares that knowledge to educate both her peers and her clients. Ms. Soares always strives to obtain the best possible outcome given each client’s individual situation. She will work tirelessly on your behalf and try unique approaches that other attorneys may not even consider. She has a perfect client rating on Avvo.
She thoroughly analyzes all possible options and then has candid and thoughtful conversations with her clients about how to proceed. Ms. Soares truly solves problems and her background in forensic accounting is an invaluable asset.
Besides being a great attorney, Ms. Soares is an excellent communicator and an adjunct professor at San Diego State University. She has the ability to utilize her open and friendly demeanor to diffuse tense situations and obtain positive results on cases – even from IRS agents, which is no easy feat! She is seen as the “go to” person to solve issues and answer questions.
A lot of business owners are not well versed with the different taxing agencies in California. These tax agencies each handle a different area of taxes: one for sales tax, one for payroll tax, and one for income tax. With so many agencies in the state, it is difficult to understand what each one does. One of the most common issues business owner encounter is an Employment Development Department (EDD) audit. When the Department is administering a payroll tax review, an EDD reviewer will inspect your payroll tax returns and related forms (Forms DE6, DE7, DE34, DE DE542, W-2, 1099, and so on) to decide if you classified your workers correctly and if the proper amount of payroll taxes have been remitted to the EDD. The EDD will typically analyze your staff, payroll, and accounting records to determine whether the payroll taxes paid to the EDD were paid to all of the workers of your organization. Most businesses will receive an Inquiry of Records notice or a Preaudit questionnaire that notifies them they are under audit.
Similarly, the IRS can review how a business classifies and pays workers and may attempt to rename them as employees. This may result in additional payroll taxes, interest, and penalties. Subsequently, the initial phase in any IRS, FTB, CDTFA or EDD audit is for an IRS or EDD audit attorney to fully understand the business and worker’s obligations with the goal of defending against potential employee misclassification.
Usually an EDD audit starts with a former payee documenting an unemployment claim. Essentially, your former worker is declaring they were an employee at your organization and are now qualified for unemployment payments. As opposed to fully examining the merits of the individual case, the EDD may analyze the status of every single contractor connected to your organization. At the start of an EDD audit, Ms. Soares will request duplicates of the unemployment case file (if applicable) in order to structure the ideal defense against employee misclassification, taxes, and penalties.
These audits begin with official correspondence notifying you of the audit and requesting documentation, which incorporates the pre-audit questionnaire. The questionnaire is intended to illicit admissions and give the auditor adequate data to develop an audit plan. Carefully answering the questionnaire responses at this crucial stage can help avoid issues later in the audit.
An EDD auditor has one objective: To decide whether contractors you hired should be re-classified as employees. Once an assurance is made, you will owe considerable penalties for neglecting to withhold income tax, neglecting to pay unemployment insurance, neglecting to withhold state disability insurance, neglecting to withhold employment training tax, etc.
Usually, the auditor will issue a demand for payment of these past due sums within 30 days. A 10% penalty will be attached if this large payment can’t be made. Despite these severe penalties for an unfavorable determination, the IRS can also adopt the conclusions of an EDD audit and assess employment taxes of their own. This can result in significant payroll tax liabilities to your business. Commonly, penalties are the main thrust in an EDD audit because the penalties can exceed the taxes owed in an EDD audit! Therefore, it is imperative that your EDD audit attorney is knowledgeable in managing the EDD and contending against penalties.
Given the amount of tax, interest, and penalties in question, personal liability, and the possibility that an EDD audit can prompt examinations by other state offices, it is crucial you have a skilled IRS and EDD audit attorney such as Ms. Soares to defend your audit.
Do not hesitate to get in touch for a free consultation to talk about how she can help defend your IRS or EDD audit. As usual, discussions with her are special and classified.