Murfreesboro, Tennessee Tax Law Lawyers

What should I do if I'm being audited by the IRS?

Don't panic, and don't ignore it. Respond within the deadline stated in the notice. You have the right to representation — an attorney can handle all communication with the IRS on your behalf. Gather your records for the years in question, but don't volunteer information beyond what's requested. An audit doesn't mean you did anything wrong.

What is an offer in compromise?

An offer in compromise lets you settle your tax debt for less than the full amount owed. The IRS considers your ability to pay, income, expenses, and asset equity. Approval isn't guaranteed — the IRS rejects many offers. An attorney can evaluate whether you're a good candidate and prepare a compelling application that presents your financial situation accurately.

Can the IRS take my house or bank account?

Yes. The IRS can file tax liens against your property, levy bank accounts, and garnish wages. However, there are procedures the IRS must follow and exemptions that protect certain assets. There are also options to halt collection activity, such as installment agreements, offers in compromise, or currently-not-collectible status. An attorney can help protect your assets.

How far back can the IRS audit me?

Generally, the IRS has 3 years from the date you filed to audit your return. This extends to 6 years if there's a substantial understatement of income (more than 25%). There is no time limit if you filed a fraudulent return or didn't file at all. State tax agencies may have different audit periods.

What if I haven't filed tax returns for several years?

The IRS may file substitute returns for you — and these typically don't include deductions and credits you're entitled to, resulting in a higher tax bill. Filing your back returns, even late, can reduce your total liability and may be required before you can enter a resolution program. An attorney can help you get back into compliance and negotiate with the IRS.

What is the difference between a tax lien and a tax levy?

A tax lien is a legal claim against your property that secures the government's interest in your tax debt. It affects your credit and your ability to sell assets. A tax levy is the actual seizure of your property — the IRS can levy bank accounts, wages, and other assets. Liens are claims; levies are collections. Both can be addressed with proper legal help.

Can I go to jail for not paying taxes?

Simply owing taxes and being unable to pay is not a crime. However, willfully failing to file returns, filing fraudulent returns, or deliberately evading taxes can result in criminal prosecution. If you're facing a potential criminal tax investigation, attorney-client privilege makes a tax attorney particularly important — consult one before speaking with anyone.

What is penalty abatement?

The IRS may waive penalties (but not the underlying tax) if you have reasonable cause — serious illness, natural disaster, reliance on bad professional advice, or other circumstances beyond your control. First-time penalty abatement is also available if you have a clean compliance history. An attorney can determine which arguments apply to your situation and present them to the IRS.