Federal Tax Attorney
Respond quickly and effectively to IRS audits and notices.
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
Don’t walk into your audit blind.
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.
When the IRS requests documents, it is important that your response is narrowly tailored to satisfy the request, without adding extraneous information. A knowledgeable tax attorney can assist you in responding to requests for documents and information and can help to ensure your rights are not violated.
IRS tax audits must be taken seriously. Call to arrange a consultation with one of our federal tax attorneys so that we can review your tax return and identify potential errors.
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.
Mendes Weed, LLP 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 both the 2019 and 2020 tax years, this amount is $15,000. 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 $30,000 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. In 2020, the exemption sits at $11.58 million dollars.
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 $30,000 all at once, $15,000 of that would be tax-free under the annual exclusion and the remaining $15,000 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% 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.
Federal Tax Resources
Federal Tax Case Resources
US Tax Court Case Lookup IRS Offer in Compromise Pre-Qualifer
CARES Act – What About Partnerships?
The IRS is giving retroactive relief to partnerships who are subject to the BBA pursuant to Rev Proc 2020-23.
Good News for Social Security Recipients!! – CARES Act in Response to COVID-19
Initially, under the CARES Act, social security recipients were going to have to file income tax returns, even if they normally did not have a tax return filing requirement.
However, after much backlash, this is no longer a requirement.
Are Cruise Lines Going to Get a Bailout?
The $2 trillion stimulus bill passed Friday, March 27, 2020, in response to COVID-19. Will the cruise lines, who are undoubtedly losing massive amounts of business right now get bailed out?
IRS Employee Retention Credit
In response to the current COVID-19 pandemic, the IRS has made an employee retention credit available to many businesses. Will you qualify?
IRS People First Initiative
Yesterday, March 25, 2020, the IRS announced its “People First Initiative.” The initiative was put into place to “help people facing the challenges of COVID-19 issues.”
Federal Tax Frequently Asked Questions
I've received a notice from the IRS about an audit. What do I do next?
You may have received a letter from the IRS asking for information. This IRS web page hints at what the IRS may ask for. For most people, they will request that you mail first them this information. Others can expect to visit the IRS field office, and yet others can expect a field audit.
You will likely have 30 days to respond to the IRS letter, which means that you should act quickly.
The best way to act is to open the letter immediately and call Mendes Weed, LLP for effective guidance.
Does my offshore bank report my holdings there?
Many offshore banks are in compliance and have registered in accordance with the Foreign Account Tax Compliance Act (FATCA). These institutions will report your offshore holdings. Use this online tool to see if your bank is on the list of compliant institutions.
California Tax Law Specialist
Partner Christina Weed has years of experience helping businesses and individuals with their complex California tax litigation issues. She is a licensed attorney with an LL.M. in Taxation from the University of San Diego and a Bachelor’s Degree in Accountancy. She serves as Chair of the Tax Section of the Contra Costa County Bar Association and is also a member of the Estate Planning Council Diablo Valley and the Tri-Valley Estate Planning Council.
In 2018, Christina became one of the first lawyers to argue a case in front of California’s Office of Tax Appeals.
Christina has been designated a Certified Specialist in Taxation by the State Bar of California.
Walnut Creek Main Office
1990 N. California BLVd.
Suite 1020
Walnut Creek, CA 94596