Frequently Asked Tax Questions

HOW WOULD YOU HANDLE MY CASE IF I AM LOCATED IN HOUSTON AND YOU ARE IN SANTA BARBARA, CALIFORNIA?

Employee Assistance Programs send me people from all over the country and I have not found distance to be a problem. Client contact is by phone and email. With a power of attorney the tax agencies will deal with me and I can get all your tax information from the taxing authorities. Contact with the tax people is by phone, mail and fax. The tax people like to see the arrival of a competent professional; it makes their work much easier.

WHO ARE YOUR TYPICAL CLIENTS?

My clients fall in three categories:

Non-Filers: Many of my clients have not filed income tax returns for 5 to 10 years. They often owe more than $100,000 to the Internal Revenue Service and state taxing agencies. Additionally, they have other creditor problems. The financial problems are typically triggered by some trauma or from self-employment without adequate tax withholding. The average clean up time can be 2 to 4 years. About half of my clients come from within a 50-mile radius of Santa Barbara, California. The rest are nationwide. Almost all are individuals.

Collection Cases: Many of my clients have filed their taxes but owe more to taxing agencies than they can pay. Resolution of these problems require planning to get the client’s financial life under control and negotiation with the tax authorities.

Audits: Clients who are being audited and need help with the audit and if the case cannot be settled with the auditor, they may need representation for a U.S. Tax Court case.

WHAT IS YOUR HOURLY RATE?

Unlike many lawyers and accountants who bill hourly, I evaluate the complexity of the problem and I propose a fixed fee arrangement. This gives me an incentive to resolve the problems as quickly as I can (rather than maximizing my income by billing as many hours as possible) and it gives the client a predictable budget to work with.

WILL I GO TO JAIL?

Not filing a tax return and willful failure to pay taxes owed are considered criminal matters. The IRS opens about 5,000 cases of criminal investigations a year and about one-half of those lead to indictments.

WILL THE IRS COME TO MY HOUSE AND TALK TO MY FRIENDS?

Of course they can, but one of the important functions of a lawyer is to buffer you from the IRS and to minimize your contacts with people from the government.

CAN I SETTLE MY CASE FOR PENNIES ON THE DOLLAR?

The IRS has the authority to compromise tax liabilities if there is doubt as to liability, doubt as to collectability or if collection will cause unacceptable hardship on the taxpayer. Compromise is one of many remedies to consider.

HOW DO I KEEP THIS PROBLEM FROM HAPPENING AGAIN?

One of the important aspects of my practice is working on financial planning and budgeting that is necessary for the client to meet his/her tax obligations going forward and to keep the problems from recurring.

SHOULD I USE ONE OF THE TAX RESOLUTION FIRMS THAT I SEE ON TV?

No. See the blog “The Problem with Tax Resolution Firms”.

DOES THE IRS CALL AND THREATEN TO PUT PEOPLE IN JAIL?

No.  There are many scam artists doing this in an effort to swindle money from scared people.