The United States has one of the most complicated tax systems in the world. It uses both the federal and state-level systems of tax collection. The federal and state taxes are separate, with each governing authority having the mandate to charge any taxes they deem fit. Thus, given how complicated and complex handling taxes is, most people run into issues with the IRS necessitating legal intervention. While self-representation is acceptable, it is advisable to have an experienced tax attorney as a legal representative before the IRS. Dealing with the IRS can be frustrating and time-consuming, especially for a layperson who does not understand the intricacies of the US tax system at both the federal and state levels.
Read on to learn how tax attorneys streamline the tax filing process and help clients fulfill their obligations.
Determining and Paying Back Taxes
There are many reasons why a taxpayer may fail to pay taxes and accumulate back taxes. Back taxes refer to the arrears an individual owes from not paying their taxes the previous year. Usually, back taxes accumulate either because a taxpayer failed to file the taxes before the deadline day, neglecting the obligation altogether, or providing income reports that do not reflect the person's actual income. In cases where the back taxes are huge and require a lot of time to catch up, hiring a tax attorney may help a client pay a significantly less amount on the back taxes. Tax attorneys have the experience to negotiate less payment on the client's behalf and avoid any penalties and interest charged on the back taxes.
Requesting Tax Reliefs
Some taxpayers do not understand how the tax system works, missing out on incentives such as tax reliefs. The state and federal governments offer tax reliefs and incentives to taxpayers that reduce individuals' tax obligations. Thus, upon satisfying a set criterion, a business or an individual can pay reduced taxes because of tax reductions. Typically, taxpayers receive tax relief through tax deductions, credits, exclusions, and debt forgiveness. Tax attorneys are competent and help clients save more money through appealing tax penalties and affordable IRS payments.
Mitigating Non-Compliance Risks
Tax avoidance and non-compliance with tax laws can result in dire legal consequences. Thus, taxpayers must take measures to mitigate any risks associated with non-compliance with tax regulations. Tax attorneys understand the tax code at the federal and state levels and advise clients appropriately to comply with tax laws. For example, in some cases, a change in a person's circumstances can trigger different tax obligations that a taxpayer may not know. Consulting a tax attorney ensures taxpayers have someone looking out for their interests.