Tax Defense Problems with a "Red Alert"

Complicated tax problems fall into many patterns, but here are few thorny ones:

1.     your funds or property gets seized by the tax authorities when in the possession of another person, for example, in a joint bank account or safe deposit box, and there are barriers or problems to immediately coming forward such as your own filing history or limited documentation;

2.     you have been served with a "last chance letter" regarding a subpoena/summons or an actual court case has been commenced to compel your compliance;

3.     an auditor or examiner has suggested to you or your representative that your returns or your activity might be "fraudulent" or warrant the fraud penalty;

4.     your tax advisor or tax representative is facing tax shelter promoter penalties and/or criminal charges relating to their work;

5.     you have given financial or tax advice and the tax authorities are claiming that your advice is in the nature of a tax shelter or false and fraudulent;

6.     you have ignored initial and follow-up notices from the State of Hawaii Failure to File Unit regarding unfiled returns, especially general excise tax (GET) returns.

7.     you have bank or financial accounts located outside the United States that you have not reported to the Treasury Department and there are income tax ramifications from your holdings in those accounts not reflected on your income tax returns.

Richard Paul McClellan III, 820 Mililani Street, Suite 701, Honolulu, Hawaii 96813 (808)523-0449