#IRS tax attorney Santa Monica

[irstaxexpert]

Are you familiar with IRS tax loopholes? In this blog, we have discussed a few and some of the benefits you can have. Read the full write-up carefully to learn more. 

[irstaxexpert]

Leading Tax Group: Your Tax Guide in the Time of Crisis and Cases of Uncertainty

One of the best parts of hiring a tax law firm is that it allows an individual an option to challenge some of the tax compliances, which otherwise was not feasible. Learn how Leading Tax Group is “leading” the way to help its clients deal with tax compliances. Click on the link to know more.

[irstaxexpert]

Are you aware of the energy credit options provided by the IRS? In this blog, we have discussed different aspects of energy credit and the benefits we can enjoy. Read the complete blog to learn more. 

[irstaxexpert]

IRS tax audit representation in Santa Monica from experienced tax experts (whom include former IRS tax attorneys) at Leading Tax Group. Get your appointment now.

[irstaxexpert]

Understanding the IRS Statute of Limitations on Collections and Assessments

The IRS statute of limitations is a crucial aspect of tax law that determines the time frame within which the IRS can assess additional taxes or collect outstanding tax debts. This period is vital for taxpayers and tax professionals alike, as it sets clear boundaries for the IRS's actions. Understanding these limitations can help taxpayers manage their financial obligations and protect their rights.

 The Basics of IRS Statutes of Limitations

The IRS statute of limitations on tax assessments generally lasts for three years. This period begins from the date a tax return is filed or the tax return's due date, whichever is later. During this time, the IRS can review the return and make any necessary corrections, including assessing additional taxes.

However, there are exceptions to this rule that taxpayers should be aware of, particularly if there is a substantial understatement of income or fraudulent activity involved.

 Extended Periods for Specific Situations

In cases where a taxpayer omits more than 25% of their gross income on their tax return, the IRS has six years to assess additional taxes. This extended period also applies if certain foreign assets are not reported.

It's essential to note that if the IRS suspects fraud, there is no statute of limitations, allowing the IRS to pursue action at any time. Taxpayers in Beverly Hills or Santa Monica seeking clarity on these rules should consult a tax attorney lawyer for specific advice.

 The Statute of Limitations on Collections

The IRS has a separate statute of limitations for collecting unpaid taxes, generally ten years from the date of the tax assessment. During this decade, the IRS has the authority to take various collection actions, such as wage garnishments or bank levies, to recover the owed amount.

This period can be extended or paused in certain situations, such as when a taxpayer enters into an installment agreement or files for bankruptcy. A Beverly Hills tax lawyer can provide guidance on navigating these situations.

 Exceptions and Tolling Events

Several factors can toll, or pause, the IRS's collection statute of limitations. These include filing for bankruptcy, submitting an offer in compromise, or leaving the country for an extended period.

It's important to understand how these events affect the statute's timeline, as they can significantly extend the period during which the IRS can collect taxes. Consulting with a Santa Monica tax lawyer can help taxpayers understand their options and the implications of these tolling events.

 The Importance of Professional Advice

Given the complexity of tax laws and the potential for substantial financial consequences, seeking professional advice is often wise. Tax professionals can provide personalized guidance based on a taxpayer's specific circumstances, ensuring compliance with the law and protecting against unwarranted IRS actions. A tax attorney lawyer can be particularly helpful in situations involving complex tax issues or disputes with the IRS. The IRS statute of limitations on assessments and collections protects both the government and taxpayers. It provides a clear timeframe for the IRS to act while also limiting taxpayers' exposure to indefinite tax liabilities. Understanding these limitations and seeking appropriate legal advice can help taxpayers navigate their obligations and protect their rights.