Glendale is the 22rd largest city in all of California and the third largest in the Los Angeles metro area. Glendale is known as the Jewel City and it is located towards the eastern end of the San Fernando Valley. Glendale’s proximity to Los Angeles can be seen from the city as L.A’s Tujunga and Sun Valley neighbor it on its northwest border. Furthermore on its western border one can find Burbank and Griffith Park. The city is particularly accessible since the Glendale, Ventura, Golden State, and Foothill freeways all run through the city’s limits.
Glendale is also unique in that it is also an international city. It is located not far from major ports and international trade centers. Furthermore, it is home to one of the largest communities of Armenian descent in the entire United States. As a prosperous area near a major metro area, Glendale fits the profile for areas where the National Taxpayer Advocate discovered clusters of tax enforcement activity. Furthermore, the international character of the city may mean that citizens are more likely than average to hold foreign assets and foreign financial accounts. The Hoffman Law Office can assist with a tax audit or a tax investigation.
What are Common Reasons that Trigger a Tax Audit?
Many taxpayers may wonder aloud or to themselves, “Why me?” It seems that there are many others out there who also making mistakes or failing to maintain their full compliance with the U.S. Tax Code. And yet, sometimes the reason for an audit can be as simple as being randomly selected. However, the random audit is far from the only reason why a taxpayer might find himself or herself in a tax audit.
The IRS also engages in a broad array of form and information matching to identify likely tax problems. What this means is when an employer or contractor provides a W-2 or 1099, they send one copy to the the individual and one copy to the IRS. If the IRS only has the employer copy, it is likely theat the employee inadvertently or intentionally concealed this source of income. If the IRS only receives the form from the taxpayer, it is possible that the contractor or employer has failed to satisfy some aspect of its payroll tax obligation.
As for the information matching, the IRS will ensure that the information you provide in your tax return is accurate and complete by matching the information found on both versions of the form. If the taxpayer decided to “make the math easier” by only using whole numbers or by rounding. Either of these practices are a nearly sure-fire way to trigger a tax audit.
FBAR and FATCA Issues Can Emerge During an Audit
If you are a U.S. taxpayer, you may have an obligation to file FATCA or FBAR disclosures regardless of whether you live in the United States or in a foreign nation. In general, both FBAR and FATCA require taxpayers to make disclosures when their foreign accounts or assets exceed certain reporting thresholds. Under FBAR, a taxpayer must make a disclosure via FinCEN Form 114 by June 30 for the previous tax year if the value of the foreign accounts exceeds $10,000 at any time during the year.
FATCA covers a broader array of accounts, but it can be more difficult to determine one’s reporting threshold because it is based off of one’s filing status and whether one was a resident in the United States during the tax year. Generally, taxpayers who are married and file jointly from a foreign country will have the greatest reporting thresholds. Taxpayers who file their taxes individually and from within the United States can typically have the least amount of foreign assets before a disclosure is mandatory. Failures to comply with FBAR of FATCA can be uncovered during a tax audit and lead to additional civil or criminal tax charges.
Los Angeles Tax Lawyer Serves Glendale
The Hoffman Law Offices are dedicated to helping individuals and businesses facing difficult tax issues and concerns. Whether you are facing a tax audit due to allegedly concealed income or you fear that an audit may uncover foreign accounts that you were previously unaware of, our practice can help. We assess you tax situation, formulate a strategy that is likely to bring results, and fight for you aggressively. To schedule a free and confidential tax consultation at the Hoffman Law Firm call us at 800-897-3915 or contact us online.