Representation Before the IRS

We represent individuals and businesses in disputes with the IRS and state tax agencies relating to federal income, employment, estate or gift tax issues and state tax issues, including representation in audits and appeals conferences, and litigation in the U.S. Tax Court and other courts.

We also assist clients with innocent spouse relief applications and offers in compromise.

Innocent spouse relief may be available for divorced or widowed/widowered clients who have income tax liabilities on joint federal income tax returns relating to income earned by the other spouse, or disallowed deductions relating to activities of the other spouse. The IRS has posted guidance on innocent spouse relief here.

An Offer in Compromise may be appropriate if a federal tax liability cannot be eliminated or reduced by other means. When you see ads saying that your tax liability can be settled for “pennies on the dollar,” this is what they are talking about. An IRS tax liability can potentially be compromised based on doubt as to liability (i.e., it’s not entirely certain that you owe the tax), doubt as to collectibility (i.e. you owe the tax, but you can’t pay it, or at least not all of it), efficient tax administration, or some combination of the three. The actual settlement rate in any individual case depends on numerous factors, including whether there are assets on which the IRS has a lien. The IRS has posted additional information on Offers in Compromise here.

Under certain circumstances, bankruptcy may be the best method to deal with a tax liability. While we do not practice bankruptcy law, we do advise clients as to the pros and cons of bankruptcy as it relates to their tax situation and set them up with an experienced bankruptcy attorney as appropriate. The rules regarding discharge of tax liabilities in bankruptcy are extremely complicated, with numerous traps for the unwary. The bankruptcy attorney you use needs to be familiar with these rules (not all are!) or be wise enough to engage professional tax assistance for your bankruptcy.

If the IRS is trying to collect taxes from you, it is subject to statutes of limitations with respect to assessment and collection of the tax. The filing of an Innocent Spouse Relief application, Offer in Compromise, or bankruptcy may extend these statutes of limitations, with potentially detrimental results. It is therefore exceedingly important that you obtain assistance from a tax professional if you decide to use any of these techniques.

James F. Gulecas, Esq., is board certified in Tax Law by The Florida Bar. He holds an LL.M. in Taxation and is admitted to practice before the Internal Revenue Service and the U.S. Tax Court.

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