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I have inherited business property. Several years of back taxes are due. Should I hire a tax attorney or a real estate attorney?

Houston, TX |

This property has been damaged in a fire and was appraised at a higher rate than it should have been for several years.

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Attorney answers 4

Posted

I agree with the attorneys above.

When you do consult with an attorney, it is a good idea to also ask him or her whether you may be entitled to some sort of reduction in the bill that is owed, for example, getting an abatement of penalties which are calculated upon the unpaid taxes and interest. Sometimes, depending on the taxpayer's situation and type of tax owed, a written letter fully explaining the circumstances, along with supporting documentation, as to why past taxes were not paid previously and, if applicable, why any tax returns were not filed, may establish a foundation upon which penalties may be forgiven by the government.

Don't assume that penalty relief is not available. Ask your attorney if -- based on the tax type involved and the jurisdiction involved -- as to whether penalty abatement relief is available based on the facts and circumstances involved.

The attorney should also consider whether or not any other forms of reduction of the outstanding bill is available, for example, through an offer in compromise (OIC) program. An offer in compromise program may allow a taxpayer an opportunity to reduce the total outstanding bill. Throught this program, the overall outstanding bill of taxes, interest, and penalties may be eligible for reduction due to a financial hardship and other qualifying criteria that clearly demonstrates that full payment of the entire liability either through a one time lump sum payment or through an installment agreement arrangement is impossible. Again, depending on the tax type, jurisdiction involved, and the facts and circumstances of your case, the OIC program may be available and, if so, you and your attorney should analyze whether it applies to your situation.

Good luck.

All best,

Suzanne Alexandra Ascher, Esq., CPA, Tax LL.M.

Legal disclaimer by Suzanne Alexandra Ascher, Esq: My answer is strictly for information and education purposes only and therefore my answer does not form any attorney-client relationship and attorney-client privilege between me and you. These questions and answers on AVVO.COM are no substitute for actual qualified legal advice by an actual licensed attorney in good standing with the bar who can become fully informed of your entire situation above and beyond the limited description of your situation in your question. Further, nothing posted in this public forum of AVVO.COM is deemed confidential or privileged communication. Finally, in accordance with IRS Circular 230 disclosure, federal (United States) tax advice provided in this communication is neither intended nor written to be used, and cannot be used, by to avoid penalties under the Internal Revenue Code or to promote, market, or recommend to anyone a transaction or matter addressed in this communication.

Posted

If the back taxes are real estate taxes, a real estate attorney will provide you with the most help. If state or federal income taxes are what you owe, contact a tax attorney.

Hope this perspective helps!

Posted

This will depend on the nature of the tax that is due. If this is payroll, sales or income taxes go with the tax attorney. If this is real estate property taxes or personal property taxes you could go with either a tax attorney or a real estate attorney. If you believer the taxes are due and you intend to pay them you may not need an attorney at all. Just pay the tax. However, if you dispute the tax or need a payment arrangement consider hiring the attorney as specified above.

Any individual seeking legal advice for their own situation should retain their own legal counsel as this response provides information that is general in nature and not specific to any person's unique situation. Circular 230 Disclaimer - Advice given in this response cannot be used to eliminate penalties with the IRS or any other governmental agency.

Posted

I agree with the responses above. You first need to determine what type of tax you will owe. If real estate then speak with an experienced real estate attorney. If you owe Payroll or Income taxes then you need to speak with an experienced tax attorney. Since you inherited the business the IRS may also look at the Estate if the individual (assuming he/she is deceased) owed personal taxes. An experienced tax attorney can assist with this as well. Dealing with the IRS can be frustrating and time consuming. As such, I highly recommend you seek assistance with this matter. Furthermore, you shouldn't wait for the IRS to contact you. The last think you will want is for the IRS to issue a levy against your bank account or garnish your wages.

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