Problems with the IRS may be an income tax audit, tax debt issue or a tax crime. If you follow the process legally to its natural conclusion, there are many forms of relief available along the way for all punitive and recovery actions being taken by the IRS.
Some of the most common legal issues and solutions associated with income tax are listed below:
If you are being audited, then you should be aware of the fine line from where unpaid tax becomes a tax crime. Unintentional errors can be rectified by paying the unpaid tax along with interest and penalty. It won't become a tax crime unless you were intentionally trying to evade taxes or engage in a deliberate fraud. If the IRS decides to prosecute you for tax crimes, you may be liable for civil tax penalties of up to 75 percent of the tax owed, along with a 5 year jail term and a fine of $500,000 for each prosecution.
You can start with the appeals process. You could ask for an offer in compromise or penalty abatement, where the IRS will accept a reduced payment. If you are filing joint returns with your spouse, you may ask for innocent spouse relief. As a last resort, you can postpone the collection process or completely discharge taxes through a bankruptcy filing.
Do you need legal representation related to income tax? Our taxation law attorneys are ready to help! Contact a taxation lawyer in your area today for more information.