- The IRS charges penalties and interest for late filing, so if you did not file your taxes when you were supposed to, you may owe quite a bit of money. A tax attorney knows the specifics of tax law and can often negotiate with the IRS on your behalf to reduce penalty and interest charges, especially if you failed to file tax returns for multiple years.
- If the IRS determines that you did not file your taxes as required, it can press criminal charges for tax evasion. If convicted, you may be fined up to $25,000 or sentenced to a year in prison for each year that you did not file taxes. If you are facing criminal charges, it is in your best interest to contact a tax attorney to help you prepare your defense and plead for leniency in sentencing if you are convicted.
- Although the IRS has only three years to audit filed returns, there is no statute of limitations on unfiled returns, according to Get IRS Help.com. The IRS generally does not pursue non-filed returns after six years, but penalties and interest on these returns may continue to mount up, and, if the IRS later decides to pursue the matter, you could owe thousands of dollars. If you realize you have not filed your return, you should contact your attorney immediately to figure out your best course of action.
- Tax attorneys often take the client's financial history to determine if there was a legitimate reason for not filing the return such as financial hardship due to divorce. The client must also give the attorney power of attorney so that the attorney may access his tax returns and discuss the issue with the IRS. Many attorneys also collect a retainer to ensure the client is serious about solving his tax problems.The attorney gets all relevant transcripts from the IRS and discusses penalties and options with the client. Ultimately, the attorney negotiates with the IRS on the client's behalf to lessen penalties and collects payment from the client to forward to the IRS.
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