It is official now: The Internal Revenue Service is going after high-income taxpayers who need to be filing returns, reporting income, and coming to terms with overdue taxes, penalties, and interest, cautions renowned tax attorney and national speaker Allie Petrova, founder of Petrova Law PLLC, a premier tax resolution law firm.
GREENSBORO, N.C. /Mortgage and Finance News/ — It is official now: The Internal Revenue Service is going after high-income taxpayers who need to be filing returns, reporting income, and coming to terms with overdue taxes, penalties, and interest, cautions renowned tax attorney and national speaker Allie Petrova, founder of Petrova Law PLLC, a premier tax resolution law firm.
In its effort to improve tax compliance in the high-income categories, the IRS has started mailing out compliance letters to more than 25,000 individuals and families with more than $1 million in income earned during tax years 2017 through 2021. IRS compliance letters have also gone out to over 100,000 high-income earners with incomes between $400,000 and $1 million for the same period.
“Clients typically feel overwhelmed in these situations. It is important to not delay and to consult with a specialized tax attorney right away because deadlines are tight. The last thing you want is to miss an IRS deadline,” cautions attorney Petrova, who guides taxpayers with high-stakes tax debt in the six and seven digits. Attorney Petrova works with clients from all over the country.
Curiously enough, this is all low-hanging fruit for the IRS because these cases were flagged based on Forms W-2 and 1099 received by the IRS from third parties. The IRS was unable to match this income data with corresponding returns, which indicated that these high-income earners received income, but did not file tax returns.
What does that mean to you? Make sure you open your incoming mail, particularly from the IRS and the state tax authorities. Muster some courage and open it right away, do not let it linger on your desk or the kitchen counter.
In some cases, the IRS can file on behalf of taxpayers what is called a substitute for return based on income reported on Forms W-2 and 1099s. That leads to exorbitantly high taxable income because the IRS does not take into account all applicable deductions. Then, the taxpayer has the daunting task to prove that this taxable income should be lower.
If a taxpayer hasn’t filed tax returns for any of the immediately preceding couple of years, the first action to take would be having these returns prepared and filed after a consultation with a tax attorney.
“When a client came to my office recently, we discovered that her family – she and her husband – owed the IRS a balance of over $600,000. While she expected some balance due to non-routine transactions, the magnitude was a bit of a surprise. IRS balances can snowball with the added interest and penalties,” shares tax attorney Allie Petrova.
The IRS has been strengthening its enforcement efforts for a while now. Thanks to Inflation Reduction Act funds, it finally has the budget and funding to be impactful.
Many of Ms. Petrova’s clients are high net worth individuals who value privacy, peace of mind, and reliable solutions. “We look at tax issues from every angle and do everything possible to discover the best solution for each client and minimize the tax impact,” remarks attorney Petrova.
For more information about tax attorney Allie Petrova, visit: https://www.petrovalaw.com/who-we-are/galina-allie-petrova/
About Petrova Law PLLC:
Petrova Law is a national tax law firm which exclusively represents high-income taxpayers and businesses with high-stakes, high-value tax debt before the IRS and state tax authorities.
For more information about Patrova Law, visit: http://petrovalaw.com/.
Learn More: https://www.petrovalaw.com/
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