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Patrick E. McGinnis, Attorney at Law. Motto
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Experienced Los Angeles Tax Attorney Answers Frequently Asked questions on California and Federal Tax Law

If you are having legal difficulties with the IRS or California agencies such as the Franchise Tax Board or EDD, you may find yourself dealing with bureaucrats who speak a different language and seem intent on confusing and bewildering you. Below are answers to some of the questions most frequently encountered by tax attorney Patrick E. McGinnis as he helps individuals and businesses resolve heir tax difficulties in Los Angeles, Orange County and surrounding areas.

If you have other questions regarding a pressing legal matter, call Patrick E. McGinnis, Attorney at Law, at 310-277-4285.

What happens to my tax refund if I am currently under an installment agreement or payment plan?

Generally, any refund you would be due for current year would be applied to the amount you owe in a prior year, even if you are making payments under a negotiated agreement

If I made a mistake on my tax return, do I need to file an amended or corrected return?

Possibly. If you claimed the wrong filing status, or if you made a mistake regarding your income or any deductions or credits you claimed, an amended return (Form 1040X) would be appropriate. Other mistakes, such as mathematical errors or failure to attach a required form or schedule, will not necessarily require an amended return but can be remedied in other ways.

I can’t afford to keep up with the sales and use tax payments required by the California Board of Equalization. Does the BOE offer a payment plan?

If you have any past due amount with the BOE, you can apply to be put on a payment plan. You can propose payments as little as any amount over $10 per payment, but the BOE is most likely to approve a request that pays off the balance due in six months or less. Some conditions which may make you ineligible for a payment plan include: 1) participation in an offer in compromise with the BOE; 2) having an account in bankruptcy, probate or receivership; 3) if you already have another payment plan going; or 4) if your seller’s permit or license has been revoked.

I filed a joint return, and the IRS took the refund to pay my ex-spouse’s tax debt, even though I have a divorce decree that puts the responsibility solely on my ex. What do I do?

If you can qualify as an injured spouse or innocent spouse, you may be able to get your share of the refund returned to you. There are many criteria you must meet to be eligible for innocent spouse tax relief, which requires filing a separate tax form as well.

How does the IRS determine whether compensation paid to an officer of a charitable organization (501(c)(3)) is reasonable or unreasonable?

The general rule is to ask what amount would ordinarily be paid for like services by like organizations in like circumstances. The IRS looks at the total amount paid as well as the services or purposes for which the amount was paid. The IRS looks at all forms of compensation to determine if the payment is reasonable and whether charitable profits are inuring to the private benefit of the individuals or shareholders as opposed to the charitable purpose of the organization.

What can I do if the IRS seizes property that I had a claim to, in order to collect on taxes owed by the person who had the property at the time?

If you are the actual owner of the property, or if you had a superior claim to the property, you may bring an administrative wrongful levy claim with the IRS or file suit in federal court to get the property returned to you. If your administrative claim is denied, you can appeal the decision administratively and eventually file suit and seek damages as well. The time limit for filing a wrongful levy claim depends upon whether the property has been sold by the IRS yet, but it can be as little as nine months from the date of the seizure. Seek advice from a qualified tax attorney with litigation experience as soon as possible to protect your rights to the property.

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