4 Times When a Business Should Consult with a Tax Attorney
When it comes to taxes, there is minimal opportunity for error on the part of any firm. It’s not just the original amount of tax that gets added on top of everything else in the form of interest and penalties if you make a mistake on your taxes. An audit is a costly process that can consume countless hours of preparatory time, resulting from careless record keeping.
To fully comprehend what the Internal Revenue Service and state tax authorities need, you must immediately consult with a tax attorney. Here are ten of the most compelling causes to see a tax lawyer about your company’s finances.
The time spent learning about your numerous tax requirements and the steps you must take to meet those obligations might be substantial. A lawyer can advise you exactly when, why, and how to act based on the specifics of your situation.
Immediacy: You shouldn’t try to pick up your employer’s tax and record-keeping requirements on the job. On day one of launching your company, you must have a system. There are always expenses associated with launching a new company, including money spent on marketing materials like business cards and stationery and hiring an initial employee (it may be just you).
2- Tax Year
Financial institutions have fiscal years. The government occasionally lets taxpayers choose their tax year, but it often selects one for them. If you need assistance determining which tax year is best for your business or if you want to ensure that you follow all government regulations, consult a lawyer.
3- Business Income
There are a variety of ways a business might bring in money. Gross income is what the IRS considers to be the sum of all money earned from any source, including sales of goods and services, as well as any other forms of compensation. Knowing what the IRS considers “gross income” is essential because failing to do so could result in higher taxes, interest, and penalties. Confer with an attorney to better understand your role in filing tax returns.
4- Business Forms and Deductions
The tax obligations of various corporate structures vary. See a lawyer if you need help figuring out which business structure is best for your situation. One consideration in this evaluation is your financial condition.
Deducting company expenses from taxable income is a significant perk of being self-employed. A thorough understanding of the different business deductions at your disposal and the steps necessary to claim them is, of course, essential. A lawyer can help you get the most out of your tax breaks.
The truth is that CPAs regularly run across tax, business planning, and business succession scenarios that call for legal counsel. Perhaps a customer is overdue on his tax payments or made an error that has prompted an IRS audit. Perhaps a client has confided something the CPA has no business keeping hidden. It could be that he needs to file a tax court appeal against the IRS audit. We need a tax lawyer since these are now legal questions, not tax ones.