While most businesses and individuals submit their returns, pay their taxes, and move on with their lives, others are forced to deal with the frustration of audits and controversies. This does not just happen on the federal level, as Commonwealth authorities also investigate and enforce tax laws.
If you are being audited or face a disappointing result, now is the time to speak to a dedicated state tax attorney. You may be able to secure a favorable initial decision or succeed with an appeal. Let a Richmond state tax audit and appeals lawyer advise you of your options.
Audits can happen for different reasons. The Department of Taxation might not provide a specific formula for how they select individuals and entities to undergo audits each year, but investigators look for specific factors.
One of the most common reasons for an audit is unpaid past taxes. Even being behind for only a single tax season could trigger an investigation. Mistakes on tax returns can also raise enough warnings to lead the authorities to trigger an audit. This might include anything from minor clerical errors to missing documentation. Other common causes include businesses that primarily deal in cash or missed filing dates.
There are two distinct types of audits used in Virginia: desk and field audits. A desk audit is the least intrusive option, as it is conducted entirely through the mail by using written correspondence. Field audits, on the other hand, require on-site examination of a variety of records. This includes not only tax returns but also business and employment records as well. These proceedings occur at times that are scheduled in advance.
Business owners and individuals have rights when it comes to being audited. This begins with the Virginia Taxpayer Bill of Rights, which ensures everyone is entitled to details of audit practices and procedures. When the audit requires in-person meetings, you have the right that it occurs at a reasonable time and place. Finally, any changes in tax liability must be supported with a clear explanation of the reasoning behind the change. A Richmond state tax audit and appeals attorney could help enforce these rights.
When taxpayers disagree with the outcome of their Commonwealth-level tax controversy, there is the option to dispute that decision at the appellate level. This is true for tax bills submitted by local governments as well.
Taxpayers have the right to request an informal review any time they disagree with a tax bill or refund amount. While this informal evaluation can lead to a reversal of the original decision, most people will need to file a formal appeal with the tax commissioner to get the outcome they desire.
While anyone who believes they were incorrectly assessed a tax obligation can submit an appeal, there is a time limit that applies to this process. The appeal must be filed in its entirety within 90 days of the decision. All collection activity is suspended while the case is in progress. A Richmond attorney could not only help with the state audit process, but they could manage an appeal as well.
If you believe that you have been audited unfairly or incorrectly assessed a tax bill, it is vital that you talk with a lawyer as soon as possible. These mistakes can be resolved, but the process is complex.
You can put yourself in the best position to succeed by relying on experienced legal counsel. Call a Richmond state tax audit and appeals lawyer today to learn more.