Articles Tagged with tax attorney

What is the Exit Tax Charged to Expatriates?
Some taxpayers may be attracted to the idea of expatriating in order to reduce their tax liability, but the “exit tax” that must be paid upon renunciation of citizenship can complicate those plans. This exit tax, also known as the expatriation tax, treats the taxpayer as though he or she has sold all assets at fair market value the day before expatriation. Obviously, this could result in an enormous tax bill for some taxpayers.

Covered Expatriates Under the Exit Tax

Only “covered expatriates” are subject to this tax. Three categories of taxpayers could be considered “covered expatriates”.

Tax audit
Getting a letter from the IRS notifying you of an upcoming tax audit is never a welcome event. At the very least, it can be  a major inconvenience. At worst, it could mean the possibility of criminal investigation for tax fraud. Knowing how to proceed when you are notified can help you prepare for the worst while hoping for the best.

Types of IRS Audits

Not all IRS tax audits are the same. When notified of an impending audit, carefully read the verbiage used in your letter. IRS tax audits are often pursued if information on your tax return doesn’t match the IRS records or inconsistencies are found, but they can also be random selection or for the collection of data. The type of tax audit requested can help you determine what you should do next: