Tax Debt Archives

Negotiating back taxes in California may be possible

There are circumstances that arise which may put an individual in a financial hole with the IRS. This can often lead to a California resident owing back taxes to the state and federal government, which can amass quickly if left unresolved. Although the fear of an IRS collection effort may be prominent in many individual's minds when their tax debt continues to rise, there may be a way to satisfy such debt by making an offer to the IRS.

Federal Judge Shoots Down Hundreds of Millions in Tax Losses claimed by Broadcom Co-Founder

In Broadwood Investment Fund LLC v. United States, No. 08-0295 (C.D. CA Sept. 21, 2012), a California federal district court judge rejected, on summary judgment, a bid by Broadcom co-founder Henry Nicholas, III, to claim hundreds of millions in tax losses from a tax shelter. The shelter was marketed more than a decade ago by myCFO, Inc. The attorney for Mr. Nicholas said that the ruling will be appealed.

California mortgage assistance could lead to surprise tax debt

Many homeowners are currently enjoying some much needed relief on the principal of their mortgage loans. Although this relief has assisted many in either selling their home through a short sale or making existing monthly payments more affordable, a tax issue may be on the horizon for thousands of California homeowners. Lawmakers across the country have stated that, unless further legislation is passed, the mortgage assistance could result in the same homeowners being subject to a substantial amount of tax debt.

IRS Audits Lead to Fraud Referrals as the IRS Seeks to Collect Revenue

Although most taxpayers are not deliberately trying to commit a crime by filing a "creative" tax return, or simply not filing a tax return, the reality is that such action, or inaction, can in fact lead to a criminal or civil fraud investigation. Although the statute of limitations for most tax crimes is six years, there is no statute of limitations for civil fraud.

Lawsuit claims California company faces large amount of tax debt

An ex-employee of a large real estate development company has filed suit against his former employer, alleging that the company used an illegal tax shelter process. The man in his suit claims that the California company owes over $500 million in tax debt. Once the company was alerted of the debt, the man alleges that the company instructed him and other employees file false documents to make it look as if the company had more debt than assets.

Increase in IRS Summons Enforcement

The IRS has more than tripled its use of administrative summons since 2005 to obtain financial documents when taxpayers refuse to cooperate. In fact, this was the most litigated issue by the IRS last year initiated by the more wealthy individuals and businesses who fought compliance. When a Revenue Agent murmurs the word "summons" the tenor of an audit may change quickly from a cooperative approach in which the IRS appears willing to negotiate, versus the heavy hand of the summons which includes the threat of court enforcement. The use of summonses, however, does increase the speed by which the IRS can process its audits and the breadth of issues the IRS may challenge on a given tax return. For example, the compliance with a broadly written summons may result in the IRS discovering a questionable item not yet addressed in the audit.

California federal employees could be fired for having tax debt

A bill that recently passed the House of Representatives calls for federal employees to be fired if they owe too much in back taxes. The proposed law, which is now scheduled to go before Senate, would affect California federal employees who were facing substantial tax debt. However, the bill provided that those trying to work out their problems with the IRS would not be included in the law

Former U.S. residents given penalty break by IRS

Our readers in California will be interested to learn that the IRS recently took steps to separate hard-working ex-patriots who are behind on their taxes from those individuals and companies who may be seeking to hide money in foreign accounts. Previously, the IRS had not made a clear distinction between Americans living abroad who were either behind on their taxes or unaware of their tax obligations from those individuals believed to be committing tax fraud.

Why do California celebrities often owe back taxes?

If you owe back taxes to the IRS, then the IRS has the power to garnish your wages, impose liens on your property and even seize your assets. One method the IRS uses to accomplish this is through a federal tax lien. Filed with the local county courthouse, a federal tax lien is a legal claim that the government holds against your property when you owe back taxes.

State board publishes list of those who owe the most back taxes

The failure to pay taxes could land one in hot water not only with the IRS but also with state and local authorities. The state of California even went so far as to publish a list of individuals and companies who apparently owe the most unpaid taxes since 2007. Government officials say they have collected more than $100 million since they started making the list public.

Contact the Law Office of Williams & Associates

For more information about our tax law services, or to discuss your tax matter, call our Sacramento office at (916) 488-8501 or toll free at (800) 684-7147. You may also send us an inquiry via email.

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