Austin Tax Defense Law Blog

Whether an Austin resident can pay his or her tax bill in full or not, tax returns are due in a timely manner. Unfortunately, if someone is unable to meet their tax liability, they might neglect to file a return and end up facing a number of consequences instituted by the Internal Revenue Service (IRS).

The first step the IRS can take is to file a substitute return on behalf of someone who has not filed timely. However, this return will most likely not give the applicable deductions and entitlements one is supposed to receive. The IRS sends a Notice of Deficiency proposing a tax assessment, after which one has 90 days to either file or petition the tax court.

When a married Texas resident files a joint tax return, it means they are both jointly and severally responsible for the ensuing liability. So, not only is it possible to collect the tax liability from the couple, the Internal Revenue Service can also collect it from any one spouse. This is true even if the couple divorces. For example, if one's former spouse did not report their income, then either of the spouses can be liable, unless one can qualify for innocent spouse relief.

If an individual qualifies for it, they can be relieved of their responsibility to pay not only the tax but also the interest and penalties resulting from it. Certain conditions must be met to qualify, such as the filing of a joint return with tax understated due to erroneous items and establishing that the innocent spouse did not know or have reason to know about the understatement of the tax. Erroneous items could be both unreported income and incorrect deductions. For example, the expense being deducted was never incurred or paid or it does not qualify as a deductible expense.

In many ways, cryptocurrency seems like it shouldn't be something you need to tell people about. After all, the word crypto itself means secret or hidden. Bitcoin and other similar popular digital currencies serve as a way for people to complete international transactions without the risk of fluctuating exchange rates.

Digital currencies also serve important roles in the digital underground and dark web, where people buy and sell items that they don't want the government to know about. However, despite these somewhat questionable roots and uses for cryptocurrency, it has become a popular investing tool since its value began to increase sharply in 2018.

A letter from the Internal Revenue Service can overwhelm most Texas residents, especially when it brings news of an audit or unpaid taxes. Filing one's taxes once is complicated enough. Then to have to justify one's claims or deductions can be frustrating, especially since most people do not know how long to hold on to receipts or which deduction to claim at what time.

Having someone knowledge about the ins and outs of IRS Tax law by one's side when both filing taxes and also when dealing with related tax issues can be very helpful. Ronald A. Stearns is a dedicated taxpayer's advocate who works tirelessly to represent his clients with tax-related issues. Not only does he represent his clients personally, he also helps with a variety of situations, from audits to unfiled tax returns.