Audit and Collection Defense

In the United States, taxes are voluntarily assessed and paid. You – the taxpayer – calculate what you owe under tax laws and remit the money to the government. If you do not pay what the Internal Revenue Service (“IRS”) thinks you owe, you may face an audit or collection action. Which path the IRS takes depends on the discrepancy or circumstances that gave rise to questions about your tax return. Either way, you will get a notice from the IRS. Upon receipt of the first notice, you the taxpayer must promptly address that notice. Failure to respond can make matters worse. Unless it is a minor issue, consult a tax attorney because IRS rules and procedures are complicated. Even if you believe you owe the money, you may challenge the assessment or qualify for tax relief. Our attorneys can evaluate your situation, explain your options, and represent you before the IRS and in court to help protect your rights and limit your liability to the extent possible.

Audit Defense

An audit is how the IRS tests the accuracy of what you reported on your tax return. If you report spending $10,000 on expenses related to your business, the IRS will want to see the receipts to prove it, which is why good recordkeeping is crucial to defending yourself in an audit.

Ideally, hire a tax lawyer to handle your audit. Your attorney will contact the IRS and work with the auditor assigned to the case so you need not worry about what to do and say during an audit. The IRS will send an Information Document Request (IDR) asking for copies of your financial records. An auditor may also visit your place of business to verify information on your company’s tax return, such as inventory levels. As your lawyer, we can assist you with compiling and presenting information to the IRS and explaining anything that may be misleading or damaging to your case. We also negotiate with the IRS to limit the scope of the audit and find an efficient resolution to the matter that saves you time and money.

If the audit concludes with a finding that you owe money, we can also help you determine the next steps. Sometimes, it is not worth appealing the audit finding if you do not have a strong case or it would be more costly to mount an appeal than what you owe the government. Where an appeal is a good option, we can argue your case. If instead you want to pay your tax bill but cannot afford to do so, we can help you apply for an Installment Agreement or Offer in Compromise.

Collection Defense

The IRS may send a notice of collections once your audit is concluded and it has been determined that you owe money. You may also receive a collection notice without being audited if you did not pay taxes or file a tax return on a timely basis, or if there are errors on your return. You can appeal a collection notice by requesting a Collection Due Process (CDP) or Collection Appeals Process (CAP) hearing. We routinely represent taxpayers in these hearings to advocate for a more favorable resolution of their tax problem than what the auditor determined. If the matter is still not resolved in your favor, we can assist you in deciding whether to file an action in Tax Court or federal district court to appeal the collection decision.

If you owe money to the IRS, you will be assessed penalties and interest. We can determine if you qualify for relief from penalties, which can result in substantial savings. Interest cannot be eliminated but if the result of our actions reduces your tax liability, your interest will also be reduced.

As with the conclusion of the audit phase, you may pay your tax bill at this stage. However, if you would have trouble paying your debt in full, you can still apply for a collection alternative, such as an Installment Agreement or Offer in Compromise.

How We Help

Discovering that you are being audited or the IRS is coming after your assets is stressful. The arcane rules make it difficult to represent yourself, so it is advisable to rely on a tax lawyer experienced in dealing with the IRS. Our attorneys understand how IRS audits and collections work. We can help you challenge the IRS’s findings or negotiate a resolution that reduces your liability so you can put your tax problems behind you. We also advise you on how to address any underlying issues or processes that caused the tax problem so the IRS will not come after you again.

Contact us today to discuss your case.