Whether you are expecting a refund this year, or you anticipate owing on your taxes, submitting and completing all necessary forms can be overwhelming. You may find yourself second-guessing on what is required or what forms you might need and making an amateur mistake on your taxes can lead to a tax audit.
Although less than 1% of taxpayers are audited by the IRS, it is important to retain a registered agent or attorney if you are summoned to an audit. There are several advantages of retaining an expert. An attorney or registered agent can help you understand the process of an audit, understand tax laws in relation to your specific case, help you avoid penalties, and begin potential negotiation plans between you and the IRS. If you are having a difficult time handling your tax problems, you are more likely to have all of your tax issues resolved by getting expert help.
Understanding the Audit Process
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If you have received a 90-day notice from the IRS, you will be required to respond within those 90 days to appeal your case. A lot of times issues with the IRS can be resolved without stepping foot into a courtroom, but this doesn’t mean an attorney won’t be necessary.
Once the process begins, your appeal will be sent to the Office of Appeals where you can work out a settlement. There are several options your attorney can take, including an Installment Agreement or an Offer in Compromise. It is important to exhaust all options before resorting to tax court. By having an expert on your side, you can align all of your documents and defend your case properly to receive the best outcome.
Tax Law and Your Case
Once you receive a letter from the IRS, most people tend to act quickly. It is important to review what the IRS is claiming and be prepared to make corrections or challenge their claims. The IRS is not always right, and there may be a miscommunication or potential clerical errors in your case. By obtaining a tax attorney who knows the law, it will make your case easier to manage, and tax attorneys can catch errors and challenge incorrect claims from the IRS because of their expert knowledge and familiarity with IRS cases.
Avoiding Penalties and Repayment Plans
Severe tax penalties can impact your livelihood. Proper representation can help you avoid paying high penalties and even assist you with getting on a payment plan that doesn’t place a financial burden on your family. Attorneys are there to ensure their clients receive the best possible outcome. Your advocate will make it easier to justify simple mistakes and negotiate payment plans that won’t leave you in a bind. The main goal of a tax attorney is to limit the amount of money you will owe and help you understand your taxes.
Facing the IRS can be intimidating, but if you hire someone to represent you, it will be much easier to digest the information you are receiving. It is also another way to learn from your mistakes and understand your financial situation a little better for the following year.