Granite Bay Tax Audit Attorney
Tax audits in Granite Bay, CA, follow the same procedures and protocols as those conducted throughout California and the United States. As a community with a diverse range of individuals and businesses, taxpayers in Granite Bay may face various types of audits. These can range from correspondence audits to field audits. In such situations, it is essential to have a local tax audit attorney who understands the unique circumstances and challenges Granite Bay residents face. These legal professionals can provide guidance, representation, and support throughout the audit process. They can help you ensure compliance with tax laws and address tax issues.
What Is a Tax Audit?
A tax audit is a review of an individual’s or organization’s financial information by a government authority. In the United States, the federal agency given this task is the Internal Revenue Service (IRS). Audits are conducted to verify that the reported tax obligations are accurate and in compliance with the tax laws. Various factors can trigger audits, including discrepancies in the tax return, underreporting of income, or random selection by the IRS.
There are three main types of tax audits:
- Correspondence Audit: Conducted through the mail, this is the most common and least invasive type of audit. The taxpayer must mail the requested documents and information to the IRS.
- Office Audit: The taxpayer must visit an IRS office and present the required documents and information.
- Field Audit: IRS auditors visit the taxpayer’s home or business to examine records and gather necessary information.
The Tax Audit Process
The tax audit process can be stressful and time-consuming. Here are the typical steps involved:
- Notification: The taxpayer receives a notice from the IRS about the audit. The notice includes the type of audit and the specific items to be reviewed.
- Preparation: The taxpayer, often with the assistance of a tax lawyer, gathers the necessary documentation to support their tax return.
- Examination: The IRS reviews the taxpayer’s records and may request additional information or clarification.
- Findings: After examining the evidence, the IRS presents its results to the taxpayer. This may include adjustments to the tax return or the determination that no changes are necessary.
- Resolution: If the taxpayer disagrees with the findings, they may appeal the decision, which may involve tax litigation. If the taxpayer agrees, they will be required to pay any additional taxes owed, as well as possible penalties and interest.
Throughout this process, a tax audit attorney can help protect your rights and interests. They can help gather documentation and represent you during an appeal or tax litigation.
Common Tax Issues and Legal Support
Tax audits can uncover various tax issues that may require legal assistance, such as:
- Tax Refunds: If the IRS disputes a claimed tax refund, a tax lawyer can help you present evidence to support your claim.
- Criminal Tax Charges: Criminal charges may be filed if the IRS suspects tax fraud or evasion. A tax audit attorney can help defend your case and work towards a favorable outcome.
- Employment Tax: Businesses may face audits related to employment taxes, such as withholding and payroll taxes. A tax lawyer can help ensure compliance and address any discrepancies.
- IRS Audits: IRS audits can be challenging to navigate on your own. An experienced tax audit attorney can provide guidance and representation throughout the process.
- Appeals: If you disagree with the outcome of a tax audit, a tax lawyer can help you pursue an appeal. They can also assist with any potential tax litigation.
California Tax FAQs
Q: What Happens If I Owe the IRS and Can’t Pay?
A: If you find yourself owing the IRS and unable to pay the full amount, it is essential not to ignore the situation. The IRS offers several options to help taxpayers who cannot afford to fully pay their tax liabilities. One option is an installment agreement. This allows you to pay your tax debt in smaller, more manageable monthly payments. Another option is an offer in compromise. Through this program, the IRS may agree to settle your tax debt for less than the full amount owed. However, you must demonstrate financial hardship. In some cases, you may also qualify for a temporary delay in collection activities.
Q: How Do I Legally Fight the IRS?
A: To legally challenge the IRS, you should begin by understanding the basis of the dispute. You will also need to gather relevant documentation to support your position. If you disagree with the results of a tax audit, you have the right to appeal the decision through the IRS Office of Appeals. This administrative process lets you present your case and supporting evidence to an impartial appeals officer. If you are not satisfied with the outcome of the appeal, you may pursue your case in the United States Tax Court or another appropriate judicial forum.
Q: Does California Audit Tax Returns?
A: Yes, California does audit tax returns. The California Department of Tax and Fee Administration (CDTFA) and the Franchise Tax Board (FTB) conduct state-level tax audits. These audits are conducted to ensure taxpayers’ compliance with state tax laws and regulations. Like federal tax audits, California tax audits can be initiated for various reasons. These include discrepancies in the tax return, underreporting of income, or random selection.
Q: What Triggers a California Tax Audit?
A: Several factors can trigger a California tax audit. Common triggers include:
- Inconsistencies or discrepancies in your state tax return
- A significant difference between your reported income on your federal and state tax returns
- Large deductions that appear unusual or disproportionate
Additionally, the state may initiate an audit based on information received from the IRS or other sources, such as tips from informants. In some cases, audits may also result from random selection. These are part of the state’s efforts to maintain overall compliance with tax laws.
Contact Coggins Law Today
If you are facing a tax audit from the IRS or CDTFA, you should consider speaking with an experienced tax audit attorney for help. At Coggins Law, we are committed to providing comprehensive legal guidance. Our firm can represent you throughout the audit process to help ensure a favorable outcome. Contact us today for a consultation. We look forward to helping you navigate your tax audit with confidence.