Income & Estate Tax Lawyer
The IRS levies income and estate taxes under Chapter 1 of the Internal Revenue Code (IRC), which generally states that these taxpayers must pay the designated rate on income from whatever source derived. Violations of the law can lead to significant penalties, plus interest that will continue to accrue on the outstanding tax balance until you pay in full. As such, you should make it a priority to avoid running afoul of IRS income and estate tax regulations and be proactive in dealing with issues if they do arise. While this seems like a simple concept, it can be far more complex in a real-life situation.
Instead of putting your financial interests at risk with income and estate tax matters, trust our team at Lehman Tax Law. We can advise you on the relevant tax regulations for compliance purposes, but we are prepared to assist if you have been accused of legal violations. Please contact us to set up a no-cost consultation with an income & estate tax lawyer today. Some basic information may also be helpful.
Penalties for Violating Income Tax Laws
If you do not file your tax return by the due date or an extension deadline, the IRS can issue a penalty of five percent of the unpaid amount for five months. In addition:
- You may incur a minimum penalty after 60 days, which is the lesser of the full tax amount or an amount designated by the IRS ($435 for returns due on or after January 1, 2020);
- Failure to pay income taxes according to an installment agreement can lead to a .25% penalty;
- If you incur penalties for failure to file AND failure to pay taxes, your filing penalty will be reduced by what you owe due to a failure to pay;
- Taxpayers who pay estimated taxes can also incur penalties, which are calculated according to your installment plan; and,
- If your check or funds are dishonored, you may receive a penalty according to a percentage of what you owe.
Rules and Penalties for Estate Taxes: Upon completion of the probate process for a deceased individual, the administrator of the estate is required to file an estate tax return Form 706. Penalties can result from filing and paying late, at a rate of 5 percent of the tax due for every month – up to 25 percent. Plus, if you underestimate the value of the estate, the penalties can be up to 40 percent. As such, extra precautions are necessary to ensure there is solid proof of an asset’s value.
Taxpayer Options: There are multiple ways to avoid incurring penalties for income and estate taxes, starting with submitting an extension to file a return and/or pay. You may also qualify to pay taxes according to an installment agreement.
An Income and Estate Tax Attorney Can Explain the Laws in More Detail
For more information on income and estate tax laws, please contact Lehman Tax Law to speak to a member of our team. You can call 561-368-1113 or check us out online to schedule a free consultation with Richard S. Lehman.