Paying taxes will always remain as one of the few absolutes in society. Filing taxes either for personal or business incomes can be daunting sometimes, and California residents may benefit from having professional assistance. This may be even more helpful as the IRS relentlessly invokes new guidelines and deadlines every year.
As the IRS systematically flexes their unique muscles over California residents, fear is the universal reaction when you receive an unexpected phone call or official correspondence. It is important to know your rights and the process of California tax law. Options may be available concerning liability or hardships when you are selected for an audit, many of which you might not be aware.
Audits can be financially costly and time consuming procedures, involving long hours of tracking information for verification. Having a proper support system in place can reduce the frustration of gathering or replicating this information, and avoiding future complications due to inconsistencies. The good news is that, if compliance is given and properly managed, the IRS can be handled with moderate discomfort. Ignoring a problem does make the situation worse and can escalate into a criminal investigation, which can result in account seizure and garnishment of wages.
Individuals who have not filed taxes in recent years may be surprised to find out that they may not be eligible to receive any refunds that would have been available. This does not mean that a debt owed to the IRS will be excused as well. The IRS will typically work to ensure that any debt to them will be paid. California taxpayers may rest assured that, even in the face of difficult circumstances with the IRS, there may be several repayment plans or compromises available to assist in settling an indomitable debt.
Source: Fox Business, "Why You Shouldn't be Scared of the Tax Man," Bonnie Lee, July 19, 2012
- Our firm handles situations similar to the issues discussed in this post. If you would like to learn more about our practice, please visit our California Tax Audits, Appeals and Protests page.