Strategies for handling IRS assessments

Article Abstract:

Delinquent taxpayers may avail of the services of certified public accountants, lawyers and enrolled agents to advise them on what options are available to the IRS to hasten tax collection. After IRS tax examiners haveruled that a tax is indeed due and has issued the necessary audit or collection notice, a meeting with their supervisor may be requested if the taxpayer and their tax advisor disagree with the findings. Any disagreement that has remained unresolved at this level can be taken to a regional Appeals Office of the IRS. Further unresolved disagreements may be forwarded to the Problem Resolution Office, after which they may be sent to the Tax Court, claims court or local district court if any agreement has yet to be reached. In paying, tax advisors must be aware that several options are open to their clients, including offers in compromise and installment agreements.

Tax Management, Analysis, Management, Tax accounting, Powers and duties, Tax assessment, Tax collection, United States. Internal Revenue Service

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The risks and rewards of limited liability companies

Article Abstract:

A limited liability company (LLC) is a mixed form of business organization conceived under state law that is characterized by a corporation's limited liability and a partnership's tax pass-through of attributes and management flexibility. An LLC form is highly suitable for entrepreneurial businesses with only a few investors because it avoids double taxation on distributed profits usually experienced by corporations. Nevertheless, it is not appropriate for every small business. An LLC may be subjected to a possible tax on asset distributions. Besides, members may be unable to freely transfer complete LLC interests. Lastly, the self-employment tax on the earnings of members could be greater than the FICA tax on the compensation of S corporation stockholders. These disadvantages should serve as a warning for would-be LLC members to take caution.

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LLCs are generally - but not always - the right choice

Article Abstract:

Tax professionals have realized that the limited liability company (LLC) is the best option when working for small to medium-sized clients. This format removes personal liability for debts of the entity, which is common among partnerships. It also avoids the double taxation of C corporation income, which usually happens in corporate taxation. Despite these advantages, the LLC should not be the sole choice because many disadvantages affecting partnerships may also affect LLCs. Other business structures may be more preferable in situations where tax treatment of partnerships is not as beneficial as the use of an S or C corporate structure. Therefore, tax professionals should avoid automatically recommending the LLC structure and assess the conditions first.

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