Tax Law Attorney in Winston-Salem, NC
As a resident of Winston-Salem, you likely have an obligation to file a personal tax return with two government agencies. One with the state through the North Carolina Department of Revenue (NCDOR) and a federal one with the Internal Revenue Service (IRS). While there are a few exceptions to this rule, you may face tax evasion charges if you don't file a state or federal tax return or underreport your income, something like a gift or estate tax. According to the Brookings Institution, an estimated three-quarters of all federal taxes due go unpaid annually, and those who don't pay may potentially unnecessarily expose themselves to legal liability for not doing so.
It should be noted that other pressing tax issues can land a person in hot water with the above-mentioned tax collecting authorities, though. Those include tax fraud, which the IRS announced had reached $2.3 billion per year in 2020. Other related matters that can leave you with problems on your hands include:
- Tax underpayments
- Tax audits
- Tax debts and collections
And, if you own a business in Winston-Salem or another part of Forsyth County, you may also find yourself in hot water if you fail to pay payroll taxes.
The IRS and NCDOR are generally willing to allow you to resolve your tax issues by setting up a payment plan or otherwise giving you time to resolve most issues civilly (as opposed to through the imposition of criminal charges); however, often only after you produce satisfactory documentation, in their minds, to warrant allowing you to engage in negotiations. That's when a Winston-Salem tax law attorney on our Ivey McClellan legal team figures into the mix. Our lawyers have long worked with Forsyth County residents facing a wide range of tax law issues and can assist you with whatever issues you face.
Understanding the Different Tax Law Disputes and Controversies You're Dealing With
Our tax attorneys at Ivey McClellan often find that prospective clients who approach us for help have limited comprehension of the allegations that they're facing. So we feel it's important to explain different terms or allegations you may have seen listed in the documentation you received from the IRS or NCDOR, which may include:
- Tax evasion: This phrase describes a person or company's underpayment of taxes or not filing a state or federal return as mandated by respective tax laws at all. Some actions that fall into the category of tax evasion include not declaring profits or income or claiming more deductions than what one actually qualifies for.
- Tax fraud: Such an allegation would generally fall into the category of a criminally prosecutable offense, which sets it apart from tax evasion. It refers to someone who allegedly deliberately avoided (evaded) paying taxes due. A Winston-Salem business or an individual (or couple filing jointly) can be accused of willfully neglecting to file a federal or North Carolina tax return.
- Tax underpayment: Self-employed individuals in Winston-Salem and businesses must generally make quarterly estimated tax payments to ensure compliance with existing tax laws. If that person or business entity fails to pay enough estimated tax payments, a 5% penalty may be attached to the unpaid amount.
- Tax audit: This concept refers to a tax revenue authority like the NCDOR or IRS more closely examining your tax return and other related transactions with potential tax implications. Tax audits generally involve a request for additional documentation so that reported financial data can be verified.
- Tax levies: According to the IRS, a tax levy is when your property is actually seized and used to satisfy an outstanding debt obligation. The same IRS resource just shared also outlines steps the federal tax collection agency must take before imposing a levy on a bank account or against your paycheck.
- Tax liens: This terminology refers to a legal claim tacked on to a piece of property to ensure tax authorities have their tax debt satisfied before an individual or business profits from that asset that is sold off.
Potential Penalties You May Face If You Fail To Address Your Tax Law Concerns in Winston-Salem
Many prospective clients who reach out to our Winston-Salem tax lawyers for help think that there's no possible way they'll be able to resolve their tax woes amicably. There are likely some big, well-executed tax fraud schemes where IRS or NCDOR officials are intent on collaborating with state prosecutors or the U.S. Attorney's Office to file criminal charges, as mentioned above. However, in many cases, these tax collecting agencies simply prefer to collect on the taxes they believe they're owed more than trying to lock you up in prison.
It's not uncommon for tax authorities to place levies on a bank account or your wages as one of the first steps if they suspect some kind of impropriety has occurred. Likewise, a tax lien may be placed against your Winston-Salem home or business to prevent you from profiting off its sale without you first meeting your outstanding tax obligation.
However, there may also be an imposition of penalties or fines aimed at not only recouping the unpaid revenue and any associated interest but also deterring you (and others) from repeating similar offenses or actions. These are generally in the tens of thousands of dollars range for most North Carolina but can be much higher depending on the nature or extent of the alleged underpayment or defrauding.
How Our Ivey McClellan Tax Lawyers Can Help With Alleged Violations of NCDOR and Internal Revenue Code
If you've received a letter from the NCDOR or the IRS notifying you of concerns with your previously submitted personal or corporate tax returns, it's not the time to sit on your hands and not do anything. These tax collection agencies aggressively pursue the revenue they believe they're due. The consequences of not acting fast to give them the documentation they want and comply with the state and federal tax law can result in serious repercussions that can be legally and financially devastating.
Thus, it's in your best interest to reach out to our Winston-Salem tax lawyers as soon as possible after receiving any communication that suggests that you violated state or federal tax laws. Our experienced Ivey McClellan attorneys are well-versed in all aspects of tax law and will know what steps you should take next in your case to avoid having to face the harshest of consequences if ultimately deemed liable or guilty of impropriety.