Holtz, Slavett, & Drabkin Tax Services
Holtz, Slavett & Drabkin provides all aspects of tax controversy representation before the Internal Revenue Service, California Franchise Tax Board, Statement Board of Equalization, Employment Development Department, County Tax Assessor’s Office and other state and local taxing authorities including collection defense, criminal tax defense, adminstrative appeals, tax litigation, audit representation, and other tax procedural matters.
Foreign Bank Accounts and Offshore Tax Compliance
The Internal Revenue Service and the Department of Justice have increased government enforcement related to foreign bank accounts and offshore tax evasion. U.S. tax laws require that each U.S. person who has a financial interest in, or signature authority over, one or more accounts in a foreign country, with the aggregate value of $10,000 or more, must file a Report of Foreign Bank and Financial Accounts (FBAR). Additional reporting requirements relate to foreign trusts, foreign gifts and foreign inheritances.
Failure to report foreign bank accounts, offshore assets, or unreported foreign income can lead to a possible criminal prosecution and significant civil penalties. Former IRS Attorneys of Holtz, Slavett & Drabkin have years of experience representing clients with issues related to offshore tax compliance and foreign bank accounts. We have represented numerous clients in the IRS Offshore Voluntary Disclosure Programs, successfully resolving their FBAR compliance issues. We also represent clients who are being audited by the IRS for potential violations of FBAR rules, or who are being criminally investigated by the Department of Justice for the alleged failure to report offshore income or accounts.
Our tax attorneys can assist clients with developing the appropriate strategy about FBAR compliance and providing vigorous defense before the IRS or the Department of Justice.
We represent taxpayers in all aspects of tax litigation. Our attorneys can represent you in all federal and California courts, including the United States Tax Court, United States District Courts, United States Court of Federal Claims, United States Bankruptcy Courts, Circuit Courts of Appeal, and the United States Supreme Court. As Former IRS Attorneys, we know how to litigate tax cases effectively and achieve the best results for our clients.
Sales Tax Defense
California imposes sales tax on gross receipts from retail sales and requires the retailers to collect and pay over this tax to the State Board of Equalization. The Board of Equalization is also responsible for conducting sales tax audits and collecting unpaid sales and use taxes. Our tax attorneys have significant experience representing taxpayers before the State Board of Equalization with respect to sales tax audit and sales tax collection matters. We can help you to reconstruct and analyze your sales records and to argue your case to the Board of Equalization auditors. We also can assist you in resolving an outstanding tax liability.
If your sales tax audit cannot be resolved with the Board of Equalization’s auditor, it is important to engage a tax professional in a timely manner. Once the State Board of Equalization issue a Notice of Determination, the taxpayer has 30 days to protest this determination. Our tax attorneys can assist you in filing a petition on your behalf and in litigating the case before the 5-member Board of Equalization. If you have a sales tax problem, give us a call – our experienced tax attorneys can represent you from the start to the end of the sales tax controversy.
Tax Audit Representation
Rates for tax audits have been steadily rising. The IRS has become more aggressive in the number and quality of tax audits. If you have been notified by the IRS or a state tax agency that your tax return has been selected for review, it is very important that you do not disregard notices. Doing so may have serious consequences, including loosing your appeal and legal rights. Getting professional help is important to protect your rights and achieving the right result. Holtz, Slavett & Drabkin attorneys have substantial experience representing individual and business taxpayers before the IRS or state tax agencies. Our attorneys are knowledgeable in handling income tax audits, sales tax audits, payroll and employment tax audits, and estate tax audits.
Tax Fraud and Tax Crimes
The IRS has a separate branch, Criminal Investigation Division, which is dedicated to investigation of potential tax crimes. Tax and related crimes include Tax Evasion, Evasion of Payment of Taxes, Fraudulent Failure to Collect Taxes, Fraudulent Failure to Pay Over Collected Taxes, Fraudulent Failure to File a Return, Failure to Supply Information to the IRS, Filing a False Return, Submitting False Documents, Money Laundering, Bank Fraud and Mail Fraud.
The consequences of a criminal investigation by the IRS or state tax agency can be very serious, including significant jail time. That’s why you need an experienced criminal tax attorney who understands both the criminal process and the tax issues involved. As Former IRS Attorneys, we have all the skills and experience to provide you with aggressive multi-tiered defense. In many instances, we are able to resolve cases without criminal charges being recommended and convincing the government that no tax crimes were committed. In instances, where post-indictment defense is necessary, our attorneys will defend you at every step of the process, including trial.
Tax Collection Defense
Offer in Compromise
An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service (IRS) that resolves the taxpayer’s tax liability. The IRS has the authority to settle, or compromise, federal tax liabilities by accepting less than full payment under certain circumstances. The IRS may legally compromise for one of the following reasons:
- Doubt as to Liability: Doubt exists that the assessed tax is correct.
- Doubt as to Collectibility: Doubt exists that the taxpayer could ever pay the full amount of tax owed. The minimum offer amount must generally be equal to (or greater than) the taxpayer’s reasonable collection potential (RCP). The RCP is defined as the total of the taxpayer’s realizable value in real and personal assets, plus his/her future income.
- Effective Tax Administration: There is no doubt that the tax is correct and no doubt that the amount owed could be collected in full, but exceptional circumstances exist such that collection of the full amount would create economic hardship or where compelling public policy or equity considerations provide sufficient basis for compromise. The taxpayer bears the burden of proof to show their OIC qualifies for public policy or equity considerations. They must show that their circumstances are compelling enough to justify acceptance of their OIC compared to other taxpayers in similar circumstances.
Our attorneys have an in-depth knowledge of the IRS offer in compromise program.
An IRS Tax Levy is a legal seizure of assets taken in order to satisfy a tax debt. An IRS Tax Levy can be attached to any property, including real estate and automobiles, but is most frequently applied to bank accounts, securities, wages and even a business’ accounts receivable. The IRS usually levies only after these three requirements are met:
- The IRS assessed the tax and sent you a Notice and Demand for Payment;
- You neglected or refused to pay the tax; and
- The IRS sent you a Final Notice of Intent to Levy and Notice of Your Right to A Hearing (levy notice) at least 30 days before the levy. The IRS may give you this notice in person, leave it at your home or your usual place of business, or send it to your last known address by certified or registered mail, return receipt requested. Please note: if the IRS levies your state tax refund, you may receive a Notice of Levy on Your State Tax Refund, Notice of Your Right to Hearing after the levy.
Our attorneys can prevent a tax levy by requesting a Collection Due Process hearing and convincing the IRS that alternatives to the levy exist. If your wages or bank account has already been levied by tax authorities, will use their skills and experience to convince the IRS to release the levy and prevent any future levies by negotiating a tax collection alternative. We will vigorously represent you through every step of the process, advising you on the best strategies and alternatives, and achieving the best possible result.
If you owe back taxes, the IRS and state agencies gain a tax lien on all your assets after meeting certain statutory requirements. The tax lien attaches to all property and rights to property (real or personal, tangible or intangible), title and interest of the taxpayer. Once the IRS or a state tax agency has a tax lien on all of a taxpayer’s assets, they may enforce that tax lien by administratively levying his or her assets. A tax lien is filed by the IRS or state tax agency to protect government’s interests. Recorded with one or several county recorders, a tax lien basically puts everyone on notice that you owe back taxes, and is generally devastating to the taxpayer’s credit and ability to borrow, lease, or refinance.
Although it is not easy to convince the IRS or a state tax agency to withdraw or release a tax lien, our attorneys have done so on numerous occasions. Our in-depth knowledge of the tax procedures helps us to check if all the administrative requirements for lien filing were met. We also try to convince the IRS or a state tax agency that releasing or withdrawing the lien is in the best interests of the government and that it would facilitate the payment of the tax due. In appropriate circumstances, we can negotiate for a subordination of the tax lien. Furthermore, if you engage us in the early stages of the tax controversy, we may be able to prevent filing of tax liens through negotiations with the IRS and state tax agencies.
Bankruptcy & Taxes
Many taxpayers (and some lawyers) are often under the mistaken belief that tax liabilities are not dischargeable in bankruptcy.
Generally, older federal income tax debts are dischargeable in bankruptcy. These old tax debts are tax debts that are more than 3 years old, for which the tax return was filed more than 2 years ago, and the taxes were assessed more than 240 days prior to filing the bankruptcy petition. In addition to being able to discharge federal income tax debts in bankruptcy, filing a bankruptcy petition halts most of the IRS’s collections activities.
The bankruptcy tax laws are constantly changing. An experienced tax attorney can help you determine if bankruptcy is a viable option for resolving your tax debt problem. Our attorneys have an in-depth knowledge of both tax and bankruptcy laws. Some of our attorneys represented the IRS as Special Assistant U.S. Attorneys and know how the tax and bankruptcy laws apply to your situation. Our attorneys can conduct an analysis of your tax liabilities and determine if you can get all or some of the liabilities discharged in bankruptcy. We also represent taxpayers in Bankruptcy Courts.
Innocent Spouse Relief
Many married taxpayers choose to file a joint tax return because of certain benefits this filing status allows. Both taxpayers are jointly and individually responsible for the tax and any interest or penalty due on the joint return even if they later divorce. This is true even if a divorce decree states that a former spouse will be responsible for any amounts due on previously filed joint returns. One spouse may be held responsible for all the tax due even if all the income was earned by the other spouse.
Section 6015 of the Internal Revenue Code provides that in certain cases a spouse may be relieved of the tax, interest, and penalties on a joint tax return. Three types of relief are available.
- Innocent spouse relief under IRC § 6015(b);
- Allocation of liability under IRC § 6015(c); and
- Equitable relief under IRC § 6015(f)
The analysis of whether you are entitled to one of the three forms of innocent spouse relief is complicated. Our attorneys possess required knowledge of tax laws and IRS procedures to determine if you qualify for the relief. We can represent you from making an innocent spouse claim on your behalf through litigating your case in front of the Tax Court. If you owe a tax liability which may be attributable to your former or present spouse, contact Holtz, Slavett & Drabkin for evaluation of your case.
Trust Fund Recovery Penalties
Failing to timely pay over payroll taxes can result in significant penalties and interest, sometimes in excess of the initial tax that wasn’t paid. The Internal Revenue Code gives the IRS broad powers with regard to unpaid payroll tax liabilities. As a result, the IRS is particularly aggressive in pursuing businesses for unpaid payroll taxes. The government may be able to pursue the business owner personally for the business’s unpaid payroll tax liabilities.
This is done by assessing the “trust fund recovery penalty” against a “responsible party”. Trust fund taxes are the income and social security taxes an employer withholds from the wages of employees. Although corporate officers, directors, stockholders and employees are normally protected from personal liability for the debts of their corporations, the IRS can assess personal liability against the so-called “responsible persons”.
Getting an experienced IRS tax attorney on your side is extremely important. Often the IRS asserts the penalty against not only the owners of the business, but its accountants, bookkeepers, clerical staff, and anyone who signed checks or had the authority to sign checks. As former IRS attorneys, we know how the IRS investigates this type of cases and what arguments they rely on in assessing trust fund recovery penalties. If you are threatened by the IRS with a trust fund recovery penalty, of if the trust fund recovery penalty was assessed against you, call our tax lawyers to evaluate your case.
A payroll tax problem generally arises when the IRS or the California Employment Development Department asserts that you improperly treat your workers as independent contracts. The IRS and the EDD use a complicated 20-factor test in evaluating whether a worker is an employee or an independent contractor. Our tax lawyers have in-depth understanding of the worker classification test, and can help you to gather evidence necessary to convince the IRS or the EDD that your workers were properly treated as independent contractors. If you cannot agree with the tax auditors, our tax litigation lawyers can represent you before the IRS Appeals Office or in court.
We also can help you to determine if you qualify for a safe harbor provision known as Section 530 relief. This Section 530 relief is available for employers who have consistently treated their employees as independent contractors and had reasonable basis to do so.
Our tax attorneys can also help you to resolve your employment tax debts. If you or your business owes payroll taxes, you may qualify for an offer in compromise or an installment agreement. Our attorneys can negotiate the best possible deal on your behalf.
Unfiled Tax Returns
The IRS has a separate branch, Criminal Investigation Division, which is dedicated to investigation of potential tax crimes. Tax and related crimes include Tax Evasion, Evasion of Payment of Taxes, Fraudulent Failure to Collect Taxes, Fraudulent Failure to Pay Over Collected Taxes, Fraudulent Failure to File a Return, Failure to Supply Information to the IRS, Filing a False Return, Submitting False Documents, Money Laundering, Bank Fraud and Mail Fraud. The consequences of a criminal investigation by the IRS or state tax agency can be very serious, including significant jail time. That’s why you need an experienced criminal tax attorney who understands both the criminal process and the tax issues involved. As Former IRS Attorneys, we have all the skills and experience to provide you with aggressive multi-tiered defense. In many instances, we are able to resolve cases without criminal charges being recommended and convincing the government that no tax crimes were committed. In instances, where post-indictment defense is necessary, our attorneys will defend you at every step of the process, including trial.
- Tax Lien Subordination Agreements
- Jeopardy Assessment Defense
- Criminal Hazard Analysis
- Grand Jury Witness Representation
- IRS Whistleblower Reward Program
- Freedom of Information Act Requests
- Tax Transcript Analysis
- IRS Employee Disciplinary Action Defense
Holtz, Slavett & Drabkin, APLC
Former IRS Tax Attorneys
315 S. Beverly Drive
Beverly Hills, CA 90212