Tax Law Frequently Asked Questions

CPAs are typically the right choice for tax preparation, accounting, and routine planning. Tax attorneys are the right choice for IRS controversy work, criminal exposure, complex transactions, and matters requiring attorney-client privilege. Many cases benefit from both working together.

Engagements vary widely. Routine penalty abatement may be a few hundred dollars in a flat fee. Offer in Compromise representation typically runs in the low thousands. Complex audits, Tax Court litigation, or business tax disputes can range higher. Valley Tax Law provides flat-fee quotes after the free case review and before engagement.

Generally 10 years from the date of assessment under IRC Section 6502. The statute can be tolled by Offer in Compromise filings, collection due process appeals, bankruptcy filings, and certain other events. The actual remaining statute is shown on IRS account transcripts.

Yes, but only after issuing required notices, providing Collection Due Process rights, and obtaining court approval for principal residence seizures under IRC Section 6334(e). Principal residence seizure is rare and usually preventable through proactive resolution.

A lien is a legal claim attaching to property; a levy is an actual seizure. Liens generally come first and protect the government's interest. Levies follow when collection alternatives are not in place.

Through an Offer in Compromise, the IRS settles for less than full payment in qualifying cases. Through the collection statute expiration, debts older than 10 years become uncollectible. The IRS does not "forgive" debt outside of these statutory mechanisms.

For most individuals, less than 1 percent annually. Audit rates increase with income level, with self-employment income, with home office deductions, with rental property activity, and with international income. Information return mismatches also commonly trigger automated CP2000 examinations.

Three years from filing for most returns. Six years if more than 25 percent of income was omitted. Unlimited if the return was fraudulent or not filed at all.

For correspondence audits with clear documentation, often yes. For office or field audits, or for any audit with substantive disputes, representation generally pays for itself in reduced adjustments and avoided procedural mistakes.

FTB administers California income tax. CDTFA administers sales and use tax and various excise taxes. EDD administers payroll taxes for unemployment, disability, and state income tax withholding. All three can audit and collect.

No. State tax debts must be resolved separately. California has its own OIC program, with similar but not identical requirements. We often handle federal and state resolutions in parallel.