What is Taxation Law?
A tax is a charge by the government on the income of an individual, corporation or trust, as well as the value of an estate or gift. There are also other forms of taxes, like consumer sales taxes, use taxes and real estate taxes. The objective in assessing tax is to generate revenue to be used for the needs of the public. A tax is not a voluntary payment but an enforced contribution exacted pursuant to legislative authority.
The IRS is responsible for administering and enforcing the internal revenue laws. It is part of the Department of the Treasury. For other relevant tax definitions, visit the Tax Law Glossary in the FindLaw Legal Dictionary.
If you don't pay in full when you file, you will receive a bill from the IRS. The first bill you receive will explain the reason for your balance due and require payment in full. It will include the tax due plus penalties and interest that are added to your unpaid balance from the date your taxes were due.
If you can't pay the balance in full, you should pay as much as you can with the notice. The unpaid balance is subject to interest which is compounded daily and a monthly late payment penalty. If you are unable to pay your balance in full, the IRS may be able to offer an individual payment plan based on monthly installments.
Tax evasion is when a person or a company purposefully underpays its taxes. Tax forms are long, the Internal Revenue Code is complicated, and unless you’re an accountant or other tax professional, you may make some mistakes that may result in underpaying taxes.
While you should always try to fill out your tax forms correctly, there’s no need to worry about being convicted for tax evasion over a simple error. To be convicted of tax evasion, the IRS must show that you deliberately tried to underpay your taxes. If you simply made an error, you’ll still have to pay what you should have paid, and possibly an additional fine, but you’ll avoid the time, expense, and penalties of a criminal trial.
Do You Need a Tax Lawyer?
A tax lawyer will be able to identify key deductions, exemptions, and credits that could make a significant impact on your tax burden. In addition, a tax lawyer will be able to advise you on the type of tax-related activities that are illegal or that may trigger an audit by the IRS.
If you fail to file taxes or file your taxes improperly, you may need a lawyer to represent your interests. The IRS not only audits taxpayers who are under suspicion or who made errors in their paperwork, but also those who are part of a group targeted for greater scrutiny. If you become the subject of an IRS audit, contact us to discuss the best course of action.
Other Ways We Can Help
Do you pay employees or private contractors for services rendered, such as farm employees, etc.? We can prepare, file, and send your 1099s and W-2s for you! Contact us by November if you would like help in this area for the next tax season so we can make sure we have enough of the necessary forms to serve you. (We place our order for forms in late November.)
Created by FindLaw's team of legal writers and editors.