Federal Tax Law Attorney
Respond quickly and effectively to IRS audits and notices.
Our Federal Law Tax Services
When complying with the IRS, delay and mishandling can make the process costly and time-consuming. As one of the leading federal tax attorneys in the San Francisco Bay area, we apply a proactive, dedicated approach to handing your federal tax law situation. Whether you are working with compliance or a tax controversy, we are dedicated to advocating for your best interests.
If you fail to respond quickly to an IRS tax audit notice you have received, you could be subject to a tax lien, which will affect your credit or a levy on your wages.
IRS Tax Audits
Our federal tax attorneys specialize in IRS tax audit assistance, so let us work with you to make the process as brief and painless as possible.
If you establish a poor tax record, it could cost you hundreds of thousands of dollars – even millions! An IRS audit reviews financial records from you or your organization to ensure that you are reporting within legal parameters. Audits can occur because of random selection or a red flag on your documentation, marked within the IRS.
If you fail to respond quickly to an IRS tax audit notice you have received, you could be subject to a tax lien, which will affect your credit or a levy on your wages.
Taxpayer Representation Before the IRS
Do you need representation due to an IRS inquiry or tax controversy? When you are going before the IRS, it is crucial that you know your rights and find representation from an experienced tax attorney who makes you feel confident.
Taxpayers often have the burden of proving their case before the U.S. Tax Court. We are familiar with the rules and procedures of the U.S. Tax Court and can assist you in presenting your case and meeting your burden of proof against an IRS audit.
Weed Law Group, PC federal tax attorneys will make sure you have all of the relevant, up-to-date tax law information and will handle your case with the careful, persistent attention required to advocate for your best interests.
If you are interested in learning more about your rights as a taxpayer, read the Federal Taxpayer Bill of Rights.
Gift Tax
The Internal Revenue Service considers a gift to be virtually any transfer of cash or property in which the donor doesn’t receive something of equal value in return. If you give someone cash with the understanding that he does not have to pay you back, that’s a gift. If you sell someone a $300,000 home for $150,000, you’ve made her a gift of $150,000.
This is all based on the IRS definition of “fair market value.” Cash is what it is, so there’s rarely any doubt there. As for that house, the IRS says its fair market value is what someone could be expected to pay for it if neither the buyer nor the seller were under any sort of duress to commit to the transaction.1
Taxpayers benefit from exemptions from gift tax. The IRS grants American citizens both a lifetime and an annual exclusion. The level of this exclusion entails that you will need to give away a significant amount of assets before it comes into use.
The annual exclusion lets you make gifts of up to a certain amount per year per person, tax-free. For 2022 tax year the amount is $16,000, which is up from $15,000 for gifts made for tax years 2018 through 2021. The keywords here are “per person.” Since it is allotted to each individual taxpayer, so you and your spouse can each give $15,000. To provide an example of how this exclusion can be used effectively, let’s say that you have four married children. You and your spouse could combine your exclusions to give $32,000 every year to each husband and each wife.
The lifetime exemption is the value of gifts you can give to others during your lifetime before you are subjected to gift taxation. The exemption figure covers both the lifetime gift tax exemption and the estate tax exclusion. Lifetime exemption is $12.06 million for the 2022 tax year and $12.92 million in 2023!
It’s a collective cap rather than by person or by year, and it’s in addition to the annual exclusion. If you gave your daughter $32,000 all at once, $16,000 of that would be tax-free under the annual exclusion and the remaining $16,000 could be covered by the lifetime exemption if you elect this option.
It is important to note that any element of the exemption that you use to avoid paying tax on gifts will decrease the exemption you have available for estate tax. For instance, if you use $1 million of the exemption on taxable gifts during the course of your lifetime, you will only have $10.58 million of the exemption remaining for estate tax. Once the lifetime limit has been surpassed, you, or your heirs, will be required to pay 40% (which is the top gift tax rate for 2022) on the amount.
Estate Tax
An estate tax is levied when the assets of a deceased individual are distributed to that person’s heirs. Since 1916, the estate tax has been one of the major sources of federal tax revenue. Nonetheless, very few people have to pay the estate tax because it only applies to estates worth millions of dollars.
An estate tax is paid by the estate, whereas an inheritance tax is levied on and paid by the beneficiary who receives a specific gift. It’s based on the value of that gift, not the whole estate. Most states that have an inheritance tax exempt very close relatives, and sometimes the deceased will indicate in their will that they want the estate to pick up this tab.
Foreign Assets
The IRS actively finds taxpayers who do not disclose their foreign bank account information, and we are here to help. It is crucial that you disclose correctly, covering all account details that the IRS requires. Accounts with an aggregate amount of $10,000 or more, over which a taxpayer has signatory authority, must be reported.
Inherited foreign accounts could be liable.
If you do not voluntarily disclose any foreign accounts by filing your FBAR (Foreign Bank Account Report), and the IRS discovers your assets, you can be liable for up to 50% in civil penalties. We will guide your through the reporting process and work on your behalf to diminish your financial risk.
Failure to disclose foreign accounts to the IRS can also result in criminal prosecution. Criminal penalties can include fines of up to $250,000, 5 years in prison, or both. In addition, criminal and civil penalties can be imposed at the same time.
Read through the IRS Guidance on reporting foreign bank accounts to learn more.