Audit Alert! How to Pick the Right Los Angeles IRS Audit Attorney

Facing An IRS Audit In Los Angeles?

If you’ve received an IRS audit notice, seeking an IRS audit attorney LA is a crucial first step. Facing the IRS alone can be risky, and expert legal help is essential for navigating the process.

Consider hiring an attorney if:

• You received any audit notice. An attorney can manage all IRS communications.
• Your audit involves complex issues like business deductions or foreign accounts.
• The potential tax assessment is significant.
• You suspect the audit could become a criminal investigation.
• You disagree with the auditor’s findings or believe they are incorrect.

An IRS audit notice is a stressful experience. While the IRS audited a small percentage of returns in 2023, Los Angeles sees a high volume of these examinations. This guide explains the audit process and the importance of proper legal support.

I’m Samuel Landis, Managing Partner at Segal, Cohen & Landis. As a nationally recognized tax attorney with over 15 years of experience, I specialize in resolving complex tax controversies for clients who need an IRS audit attorney LA. Let’s explore how to manage this process effectively.

Understanding The IRS Audit: What LA Taxpayers Need To Know

An IRS audit is an official review of your financial information to verify that your tax return was accurate. Many audits result in “no change,” but the stakes can be high. In fiscal year 2023, the average individual audit resulted in a $10,000 assessment, while business audits averaged $120,000.

The IRS uses automated systems to flag returns that deviate from the norm. Common triggers include high deductions relative to income, missing 1099 or W-2 information, or connections to others under investigation. Due to the Inflation Reduction Act, high-income earners and large corporations in Los Angeles now face increased audit rates.

Want to know more about your specific risk factors? Check out our guide: Are You at Risk of an IRS Audit and How Far Back Can the IRS Go?

The Different Types of IRS Audits

Not all audits are the same. Understanding the type you’re facing is key to preparing correctly.

• Correspondence audits are the most common. The IRS requests information by mail. While seemingly simple, a mistake in your response can lead to complications. This is where an IRS audit attorney LA can prevent costly errors.
• Office audits require you to meet an agent at an IRS office to discuss specific items on your return, such as business expenses or deductions.
• Field audits are the most serious. An agent visits your home, business, or representative’s office for a comprehensive examination, often for complex business returns. These can last for months and require professional representation.

Potential Consequences and How to Prepare

If an audit uncovers discrepancies, the consequences can be severe. You may face additional tax assessments, plus steep penalties for accuracy-related issues (20%) or fraud (75%). Interest accrues from the original tax due date, adding significantly to your total liability.

In the most serious cases, a civil audit can escalate into a criminal tax fraud investigation. The IRS Criminal Investigation division has a conviction rate of over 90% for referred cases, with most convictions leading to prison time under Internal Revenue Code Section 7201.

Preparation is critical. You must gather all relevant documentation, as the IRS operates on the principle: “If it’s not documented, it didn’t happen.” Key records include:

• Receipts for all claimed expenses
• Bank statements
• Loan agreements
• Canceled checks
• Legal papers (divorce decrees, trust documents)
• Mileage or home office logs
• W-2s and 1099s
• Prior tax returns

For more detailed guidance, see our article: Navigating IRS Audits: Tips, Remedies, and the Importance of Tax Attorneys

The Critical Role of the Statute of Limitations (ASED)

The Audit Statute Expiration Date (ASED) is the IRS’s deadline for assessing more tax.

• The standard three-year rule gives the IRS three years from your filing date to initiate an audit.
• The six-year rule applies if you understate your gross income by 25% or more.
• An indefinite statute exists for fraudulent returns or failure to file, allowing the IRS to go back as far as they wish.

During an audit, an agent may ask you to sign a waiver to extend the ASED. Agreeing to this without legal advice is a major mistake, as it gives the IRS more time to find issues. An experienced IRS audit attorney LA will advise if an extension is truly in your best interest. The statute of limitations is a key protection; don’t waive it without expert counsel.

The Critical Role Of A Tax Attorney In An IRS Audit

Facing an IRS audit alone is a significant risk. A skilled IRS audit attorney LA acts as your legal shield and advocate, ensuring you are treated fairly and your rights are protected.

We provide legal representation by handling all IRS communications, which reduces your stress and prevents accidental missteps. We ensure your taxpayer rights are respected throughout the process. With strategic guidance, we develop a personalized plan to build the strongest case for your situation, giving you peace of mind to focus on your life and work.

To learn more about how we provide this crucial support, please visit: IRS Audit Representation.

When to Hire an IRS Audit Attorney LA

The best time to hire an IRS audit attorney LA is the moment you receive an audit notice. Early intervention can change the entire outcome. Our expertise is vital in these situations:

• Receipt of an audit notice: An attorney’s review from the start can prevent small issues from escalating.
• Complex financial situations: Audits involving business transactions, foreign accounts, or large investments require specialized legal knowledge.
• Large amounts at stake: When facing a significant potential tax assessment, the cost of an attorney is a wise investment.
• Suspicion of criminal exposure: If an audit hints at fraud, an attorney is critical to protect your Fifth Amendment rights—a protection a CPA cannot offer.
• Disagreement with the auditor: An attorney can negotiate, present legal arguments, and escalate your case to appeals if necessary.

For advice on finding the right professional, check out: How to Find Tax Attorney Los Angeles.

Tax Attorney vs. CPA for Audit Defense

While both are skilled professionals, tax attorneys and CPAs offer different protections during an audit, especially in serious cases.

Feature	Tax Attorney	CPA (Certified Public Accountant)
Primary Role	Legal counsel, litigation, tax controversy	Accounting, tax preparation, financial reporting
Attorney-Client Privilege	Yes, protects confidential communications from disclosure in legal proceedings.	Limited, does not extend to criminal proceedings or state tax matters.
Scope of Practice	Represents clients in IRS audits, appeals, and Tax Court/federal courts. Handles criminal tax matters.	Represents clients in IRS audits and appeals (if an Enrolled Agent). Generally cannot represent in Tax Court or criminal matters.
Legal Strategy	Expertise in legal interpretation, case law, and procedural rules.	Expertise in accounting principles and tax code application.
Criminal Defense	Can defend against criminal tax charges.	Cannot defend against criminal tax charges.

The most significant difference is the attorney-client privilege, which protects your confidential communications with an attorney from being disclosed to the IRS. This privilege is essential if your audit involves potential criminal issues, as the limited privilege for CPAs does not apply in criminal matters.

The Benefits of Proactive Representation

Waiting to hire an attorney puts you at a disadvantage. Bringing in an IRS audit attorney LA immediately provides significant benefits.

With early intervention, we can analyze the audit notice and develop a strong strategy before you ever speak to the auditor. We create a customized action plan to address your specific issues and present your case effectively. Our involvement helps prevent costly mistakes, such as providing too much information, and we are skilled at mitigating penalties through negotiation. We take a holistic approach, considering the audit’s impact on your overall financial health and exploring all available tax relief options.

Our firm’s 33+ years of experience and 25,000+ satisfied clients demonstrate the power of proactive, expert representation. Learn more in our insights: Business Tax Attorneys in Los Angeles: Key Insights.

Winning Strategies: How A Top IRS Audit Attorney LA Fights For You

Facing an IRS audit requires a strategic partner who knows how to fight for you. At Segal, Cohen & Landis, our approach as an IRS audit attorney LA is methodical and assertive, focused on achieving the best possible outcome.

We begin with immediate damage control, assessing your situation to prevent you from making common mistakes like providing too much information. Next, we guide you in evidence presentation, carefully organizing and submitting only the necessary documentation to support your tax position favorably.

Our deep knowledge of tax law allows us to build powerful legal arguments, challenging the IRS’s interpretation of rules with statutes and case precedents. Most importantly, we excel at negotiation with auditors. With over 33 years of experience, we engage directly with IRS personnel to seek a fair resolution, often including penalty abatement, without the need for litigation.

For more on our defense tactics, read: IRS Audit Defense Strategies: Navigating the Audit Process with a Payroll Tax Attorney.

Advanced Defenses: Pleading the Fifth and Other Legal Privileges

If an audit hints at criminal activity, your Fifth Amendment rights become paramount. This constitutional right protects you from self-incrimination. However, deciding when to invoke this privilege is a complex legal determination that should never be made without an attorney.

An experienced IRS audit attorney LA can assess whether questions pose a genuine criminal risk and advise on the proper way to assert the privilege. While invoking the Fifth can have consequences in a civil audit, it is absolutely essential if criminal charges are a possibility. Given the IRS Criminal Investigation division’s high conviction rate, this is not a risk to take alone. We understand the nuances of Federal law on self-incrimination and can provide the critical legal buffer you need.

Resolving the Audit: Offers in Compromise and Innocent Spouse Relief

Even after an audit assesses a tax liability, we have strategies to reduce the financial burden.

An Offer in Compromise (OIC) is an agreement with the IRS to settle your tax debt for less than the full amount owed. The IRS may accept an OIC based on doubt as to liability (you don’t owe the tax), doubt as to collectibility (you cannot afford to pay), or effective tax administration (payment would cause extreme hardship). Our attorneys are experienced in preparing and negotiating compelling OICs.

Innocent Spouse Relief can protect you from tax liability caused by your spouse’s (or former spouse’s) errors on a joint return. If you can prove you were unaware of the misreporting, we can help you apply for this relief. These solutions can provide a financial fresh start but require expert preparation.

Learn more about these options here: Essential Los Angeles Tax Relief Options for Economic Relief.

After The Audit: Navigating Appeals And Collections In LA

An unfavorable audit outcome is not the end of the road. An experienced IRS audit attorney LA can continue to advocate for you through the appeals process and protect you from aggressive collection actions.

Disagreeing with the IRS: The Appeals Process

You have the right to appeal an auditor’s findings. The IRS Appeals Office, an independent body within the IRS, provides an opportunity to resolve disputes without going to court. To initiate an appeal, we prepare a formal “written protest” that outlines the facts, laws, and legal arguments supporting your case.

If an agreement cannot be reached in Appeals, the next step is to file a petition with the U.S. Tax Court. We are fully prepared to build a strong case and represent you in court if litigation becomes necessary to achieve a just outcome.

Understanding your rights is key. Learn more here: Los Angeles Tax Laws: What You Need to Know About IRS Representation.

Handling IRS Collection Actions

If a tax debt goes unpaid, the IRS has powerful collection tools, including tax liens on your property, bank levies to seize funds, and wage garnishment. In severe cases, they can even request passport revocation.

An IRS audit attorney LA can intervene to stop these actions. We negotiate with the IRS to release liens and levies and can arrange manageable payment plans, such as an installment agreement. We explore all options to find a workable solution for your debt.

Our comprehensive Tax Services include a robust defense against these aggressive collection tactics.

The Los Angeles Advantage: Local and State Tax Expertise

In addition to the IRS, California has its own tax agencies that conduct audits. An IRS audit attorney LA with local expertise understands the specific challenges of the California tax system. We handle disputes with:

• The California Franchise Tax Board (FTB) for state income tax.
• The Employment Development Department (EDD) for payroll tax audits.
• The California Department of Tax and Fee Administration (CDTFA) for sales and use taxes.

Our deep knowledge of federal and California tax laws, combined with our familiarity with these local agencies, gives our clients a distinct advantage.

Frequently Asked Questions About Hiring An IRS Audit Attorney LA

Facing an IRS audit brings many questions. Here are clear, straightforward answers to some of the most common concerns.

How much does it cost to hire a tax attorney in Los Angeles?

The cost of hiring an IRS audit attorney LA varies based on the complexity of your case. At Segal, Cohen & Landis, we offer flexible fee structures, including flat fees for straightforward matters and hourly rates (often with a retainer) for more involved cases.

While cost is a factor, it’s important to weigh it against the potential savings. An experienced attorney can often save you far more in taxes, penalties, and interest than their fee, making it a sound investment in your financial security.

For more on typical costs, explore our resources: An Overview of Fees for Los Angeles Tax Attorneys and Average Costs of Hiring a Tax Attorney in Los Angeles.

Can an attorney reduce the amount of tax I owe?

While no attorney can guarantee a specific outcome, an experienced IRS audit attorney LA significantly improves your chances of a more favorable result. We work to reduce your liability by:

• Arguing for penalty abatement: We are often successful in having penalties reduced or eliminated.
• Negotiating settlements: We can frequently negotiate a settlement with the IRS for less than the amount they initially proposed.
• Challenging incorrect assessments: We will vigorously challenge any errors the IRS has made with strong legal arguments.

Statistics show that taxpayers with professional representation are more likely to achieve a better outcome. Our goal is always to minimize your tax liability and protect your financial interests.

What is the very first thing I should do after getting an IRS audit notice?

First, do not panic. Second, do not contact the IRS yourself.

Your immediate priority should be to contact an experienced tax attorney for a consultation. This is the single most important first step. We can review the notice, explain what the IRS is looking for, and advise you on the best course of action.

Key points to remember:

• Do not ignore the notice. This will only make the situation worse and lead to more aggressive actions from the IRS.
• Do not contact the IRS yourself. Anything you say can be used against you. Let your attorney manage all communications to ensure only necessary and beneficial information is shared.

We offer consultations to discuss your situation. Don’t face the IRS alone. Reach out to us: Contact.

Conclusion: Secure Your Peace Of Mind With The Right LA Tax Attorney

An IRS audit is a serious challenge with high stakes, from significant tax assessments to, in rare cases, criminal investigations. You should not face this complex process alone.

An experienced IRS audit attorney LA is your most valuable ally, serving as your shield, guide, and advocate. At Segal, Cohen & Landis, we take this burden off your shoulders.

With over 33 years of experience and a record of helping 25,000+ satisfied clients, our team has a deep understanding of federal and California tax law. Our proven ability to negotiate, advocate, and litigate when necessary equips us to protect your interests and achieve the best possible outcome.

Don’t let an IRS audit control your life. Take a proactive step to regain control and secure your peace of mind.

Get expert help from a Los Angeles Tax Attorney