Orange County IRS Tax Lawyer
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Experienced Orange County IRS Tax Attorney Ready To Fight For You

A lawyer for IRS matters in Orange County.If you run a company, you know that IRS audits are time-consuming, expensive, and stressful, taking away energy and time from things you should be focusing on. Having an experienced Orange County IRS tax attorney by your side reviewing your IRS notice is very important and can help you to navigate through your various options. No one likes to receive an IRS audit notice. But it’s important to understand how the IRS is selecting your tax return for audit.

Amended returns

Taxpayers often try to amend tax returns from a prior year as quickly as possible. But, amended returns are highly likely to be audited. The secret is getting a trusted Orange County IRS tax lawyer before you make an adjustment to review the tax returns.

IRS computer score

Everything on your return is utilized to give data to the IRS who in turn, scores your return. Your zip code, your occupations, income, and expenses are for the most basic things that will tip the IRS off that there was a generous change in your return or that you are not within the average business-standard. The IRS is overwhelmed and tends to come up short. They choose returns they believe will have the best possibility for a tax adjustment.

A Schedule C with low revenue or high costs

A Schedule C is a page on your individual tax return where your business income and expenses are reported. As a business grows, most CPAs and business/tax lawyers will suggest that a sole proprietor or Schedule C business set up a separate legal entity for legal protection and to reduce your chances of an audit. Most Schedule C taxpayers with revenue or expenses that exceed $100,000 have a higher probability of an audit.

In addition, there are many other ways the IRS selects a return for an audit such as payroll initiatives, tips from ex-employees/ex-spouse/ex-partner, and state agency audits. It is highly advisable that you speak with an experienced Orange County IRS tax attorney at Allison Soares, Attorney at Law. Call us today!

Our Success Records

We have represented countless clients in IRS matters. To view a comprehensive list of our case results, click here. Here are some of our success stories:

  • Rерrеѕеntеd taxpayer wіth $30 mіllіоn іn alter-ego liens еrrоnеоuѕlу assessed аgаіnѕt іt. Suссеѕѕfullу appealed the fіlіng and IRS wіthdrеw аll lіеnѕ.
  • Aрреаlеd IRS Exсіѕе Tаx Rеturn disallowance of $1 mіllіоn in еxеmрtіоnѕ on taxpayer’s rеturn. Successfully арреаlеd thе claim, whісh resulted in no tаx duе tо IRS.
  • Tаx preparer with $200,000 іn penalties for “recklessly аnd willfully” preparing tаx rеturnѕ. Successfully rеduсеd IRS penalties tо $30,000.
  • Dеfеndеd a сlіеnt іn a criminal іnvеѕtіgаtіоn bаѕеd оn аllеgеdlу structuring trаnѕасtіоnѕ, роtеntіаllу fіlіng оf frаudulеnt income tax rеturnѕ, аnd fаіlіng tо fіlе IRS Form 8300. Rеѕultеd іn a no аrrеѕtѕ, Prе-Judісіаl Settlement Agreement, аnd thе government rеturnеd thousands of dоllаrѕ thаt were ѕеіzеd frоm the client’s bаnk ассоunt.

IRS Appeals
An attorney discussing IRS tax to his client in Orange County.

The IRS Appeals Department is comprised of very knowledgeable and experienced professionals. As a business, you have the right to appeal their decision following an audit. There are various ways of appealing an IRS audit and the strategy you take can influence the consequences of your audit. Contact our Orange County IRS lawyer and find out what your options are and what is the best way to appeal an audit decision.

IRS Appeals Process

Not everyone has the right to appeal an IRS audit. There are generally three rules that govern whether you can appeal, and all three must be present. First, you receive a letter from the IRS stating that you have the right to do so. Second, you do not agree with the IRS’s decision with respect to your audit. Third, you did not sign an agreement form sent to you by the IRS.

You’ll also want to consider whether the IRS made an incorrect decision with respect to your audit, and whether that decision was based on a misinterpretation of the law, or if they didn’t apply the law due to a misunderstanding of the facts. Consider also whether the IRS is taking inappropriate collection action against you, or if the facts the IRS used are incorrect. In all these instances, be prepared to clarify and support your position with facts and sounds arguments.

If all those are true in your case, then you may request an Appeals hearing. To do that, complete your appeal and mail it to the address that is included in the IRS letter. You may also want to consider who will represent you in your appeal. You can certainly do it yourself, but it may serve you better to work with an experienced Orange County tax attorney, certified public accountant, or an enrolled agent authorized to practice before the IRS.

Collection Due Process (CDP)

The IRS Collections department comes into play when a person or business owes money to the IRS. Here are some of the ways a person or business can owe money to the IRS: currently not collectible, partial pay installment agreements, streamline installment agreements, offer in compromise, and bankruptcy. IRS matters can be very confusing and many taxpayers will often misunderstand the difference between the Assessment and the Collections side of the IRS. The Assessment side handles your account when you file a tax return or if your return is audited, while the Collections side is only preoccupied with collecting what you owe and does not get involved with “why” you were audited in the first place.

The IRS Collections process begins when you have not paid the taxes you owe when you file the return. The IRS will send you a bill for the amount you owe and any penalties and interest. This is the start of the collections process. The amount you owe will continue to grow with interest that compounds daily, as well as a monthly late payment fee. The process continues until you have paid the amount in full, or when the time period of collection ends.

A Collection Due Process (CDP) hearing is an opportunity for taxpayers to discuss with the IRS any lien or levy action they may be facing. This is typically the last step to appeal before the IRS enforces a collection on your property or bank account. Once the IRS issues its Final Notice of Intent to Levy or Federal Tax Lien Filing, it must wait 30 days before beginning any action. It is during this 30-day period that you can file the request for a CPD hearing. To request a CDP, you must complete Form 12153 and submit it to the IRS. It must be submitted to the address shown on the lien or levy notice, and include a copy of the notice.

Payment Plans

If you cannot afford to pay your tax bill in full, the IRS does offer payment plans or installment agreements. Generally, the IRS will allow you to set up a streamlined payment plan if you owe $50,000 or less; demonstrate you can’t pay the amount you owe now and can pay off the taxes owed in three years or less. The IRS offers four payment plans:

  • A short-term payment plan is for taxpayers who can pay off their debt in 120 days or less. There is no setup fee; however, you will need to pay any accrued penalties or interest until the balance is paid in full.
  • The long-term payment plan is for taxpayers who need more than 120 days to pay the amount, and the payments are taken through automatic withdrawals from your checking account. This is also known as an installment agreement. There is a $31 setup fee, and you will need to pay any accrued penalties or interest until the balance is paid in full.
  • A streamlined payment plan is an option if your balance is below $50,000 the IRS will allow you to streamline your payment plan over 72 months with no financial information provided.
  • If your balance is greater than $100,000, the IRS will require you to provide financial information including income and proof of expenses.

Collection Appeals Program

The Collection Appeals Program (CAP) is an option for taxpayers facing a tax lien or if you’ve been denied the option of establishing a payment plan. The CAP is administered through the IRS Office of Appeals. You are given a hearing and it’s there you can argue for an installment agreement or payment plan. However, you cannot appeal the outcome of the CAP. It’s best to work with an experienced California tax collections lawyer if you’re facing a CAP hearing.

How Our Orange County IRS Tax Lawyer Can Help You

Allison Soares is an experienced lawyer who has represented hundreds of clients before the Internal Rеvеnuе Sеrvісе (IRS) and has experience in CAP hearings and collections. She enjoys fixing tax problems and helping people, in matters including audits, collections, appeals, and general dealings with the IRS.

IRS Collection Process

The IRS Collections department comes into play when a person or business owes money to the IRS. Here are some of the ways a person or business can owe money to the IRS: currently not collectible, partial pay installment agreements, streamline installment agreements, offer in compromise, and bankruptcy. IRS matters can be very confusing and many taxpayers will often misunderstand the difference between the Assessment and the Collections side of the IRS. The Assessment side handles your account when you file a tax return or if your return is audited, while the Collections side is only preoccupied with collecting what you owe and does not get involved with “why” you were audited in the first place.

Speak with our experienced Orange County IRS collections attorney to find out what you can expect, what the process looks like, and what your best options are.

IRS Levies & Liens
There are 3 common tools that the IRS uses to collect payments from those who owe money: IRS levies, IRS liens, and wage garnishments.

IRS Levy: In this scenario, the IRS collects the money owed directly from your bank account. This is a very aggressive method and it is only used after they tried several times to contact you and have failed to reach you. If you receive a “Final Notice of Intent to Levy and Notice of Your Right to a Hearing,” you have little time left to contact the IRS before they freeze your account.

IRS Liens: A tax lien is the government’s legal claim to property that is held in your name. A tax lien attaches to all of your property, including property that you may acquire in the future.

Wage Garnishments: If your employer tells you they’ve received a Notice of Wage Garnishment, this notice is effective immediately upon receipt and it required that your employer must pay the IRS the proper levy amount on each payday that the levy remains in effect. Contact us immediately so we can guide you on how to best navigate this scenario.

IRS International Compliance IssuesThere are two entities that require you to report on foreign accounts and assets:  the IRS and the Department of Treasury. Many people are not aware that they must report to both departments. Reporting to one of them and forgetting the other can cause serious penalties, as the two departments do not exchange information (reporting to one does not mean the other is also receiving the information). These are two separate reports, they use different forms, and have different requirements. If you have accounts or assets outside of the United States, or if you own a property abroad, ask for expert advice from our Orange County IRS tax attorney.

Innocent Spouse Relief

Generally, you and your spouse are jointly liable for your tax debt. If you qualify for Innocent Spouse Relief you will not be responsible for the taxes, interest, and penalties. This scenario occurs when a spouse did not report or under-reported certain items on the joint tax return. This could happen even if the couple is divorced if the error took place on a previous joint tax return.

Although many taxpayers believe they qualify, Innocent Spouse relief can be very difficult to establish. One of the hardest hurdles to overcome is that the “innocent” taxpayer did not know or did not have any reason to know there was an error or an issue with the tax returns. It is important to reach out to an Orange County IRS attorney to determine if you qualify for Innocent Spouse Relief.

Payroll Tax Issues

There are many tax requirements that employers must abide by. Employers are required to timely report and deposit all employment and payroll taxes. If the employer fails to meet these requirements they will be subjected to substantial penalties and interest. Payroll taxes can also be weighed against an owner, officer, or employee of the business. If you have any payroll tax issues, an Orange County IRS lawyer can determine what your options are and how you can resolve this very expensive area of tax law.

Trust Fund Recovery Penalty Issues

A lawyer explaining IRS penalty issues to a client in Orange County.The IRS wants businesses to pay employment and income taxes timely. When an employer takes payroll taxes from an employee’s paycheck, the employer is holding the money for the government in “trust” until they pay that money to the IRS. If the employer does not make these “trust” payments, the IRS can collect the funds that were withheld from the employee from you personally. The business does not have to stop doing business for the IRS to attempt to collect from you as an individual. If you have been assessed a trust fund penalty, you have a very limited time to appeal this assessment before it goes final. An experienced Orange County IRS attorney can determine the assessment can be prevented or whether you need a timely appeal to the assessment.

Do I need to file a business tax return in California?

All California businesses — whether a corporation, LLC/LLP or sole proprietorship, are required to file annual tax returns. This is required even if the business was inactive or did not earn income during the tax year.

When must an LLC file a tax return?

If an LLC operates on a traditional fiscal year basis, it is required to file a tax return (Form 1040 with Schedule E attached) by the 15th of the third month after the tax year ends. LLCs that operate on a calendar tax year, and are taxed as corporations, should file Form 1120 by April 15  of the calendar tax year. Additionally, LLCs conducting business in California must file Form 3522 and pay an annual LLC tax.

Do you need an EIN for a California business?

An employer identification number (EIN), which is also known as a tax ID number, is required for most California businesses. Like a personal social security number, the EIN is used by the IRS to identify businesses with respect to taxes. Generally, any business that has employees needs an EIN. However, an EIN is not needed if you’re a sole proprietorship or an LLC without employees. In those circumstances, you would use your social security number.

What taxes do businesses pay in California?

Businesses in California are required to pay income tax. The California corporate tax rate that applies to C corporations and LLCs is a flat rate of 8.84%. If a business did not make a profit, they are still required to pay taxes in the form of a flat rate of 6.65% alternative minimum tax (AMT). Additionally, some California businesses are required to pay a franchise tax.

How much revenue is considered a small business?

The United States Small Business Administration (SBA) defines a small business as earning revenue ranging from $1 million to over $40 million, as well as employing anywhere from 100 to over 1,500 employees.

Frequently Asked Questions

Do I need to file a business tax return in California?

If you are a California resident, part-year resident, or nonresident, and you file a federal tax return, then you must file an income tax return to the state. All business types, including charities/nonprofits, corporations, Limited Liability Companies (LLC), partnerships and sole proprietorships, are required to file a tax return with the California Franchise Tax Board.

When must an LLC file a tax return?

The LLC is required to file a Form 1040 tax return by April 15. However, tax payments are generally due more frequently if the LLC owners/partners pay quarterly tax payments. If this is the case, payments are to be made by the quarterly tax payment deadlines in April, June, September, and January.

Do you need an EIN for a California business?

An Employer Identification Number (EIN) is essentially a social security number of businesses. The EIN is an IRS requirement; not every business in California needs an EIN. They are required for C or S corporations, partnerships, and some LLCs. Businesses that file employment and payroll taxes must have an EIN.

What taxes do businesses pay in California?

In addition to taxes paid to the IRS, California businesses must pay state income tax. Additionally, most California businesses are required to pay a corporate tax, the alternative minimum tax (AMT), and a California franchise tax. The franchise tax applies to S corporations, C corporations, LLCs and LLPs.

How much revenue is considered a small business?

The Small Business Administration (SBA) generally considers businesses that earn less than $50 million in annual revenue as small businesses. Additionally, a small business has less than 100 employees.

Speak With a Highly-Experienced Orange County Tax Lawyer Today

Whether you own a business in Orange County or anywhere else in California, speak to a highly-skilled Orange County tax attorney at Allison Soares, Attorney at Law.

Our Orange County tax lawyer Allison Soares practices the following legal areas:

CALL our Orange County IRS tax lawyer directly or contact us through our online form today.

Testimonials

"Allison was a pleasure to work with. Smart, professional and responsive to my calls and concerns, and often took extra time to educate me about my situation and options. Most importantly though, I was happy with the results and Allison was able to get me an arrangement that I found both fair and affordable."
- Jeffrey S