Morgan Sebastian Law, PCDo You Have IRS And State Tax Debt? Let Morgan Sebastian Law Help You.2026-09-28T10:32:04Zhttps://www.morgansebastianlaw.com/feed/atom/WordPress/wp-content/uploads/sites/1402396/2021/11/cropped-fav-icon-32x32.pngOn Behalf of Morgan Sebastian Law, PC<![CDATA[What evidence do you need to dispute an IRS audit?]]>https://www.morgansebastianlaw.com/?p=480542026-09-28T10:32:04Z2026-09-28T10:32:04ZRecords that support your tax return
Bank statements, receipts, invoices and canceled checks can help show the income, expenses or deductions reported on your return. Credit card statements may also help prove business or other deductible expenses. Organize the records by date and category so they match the items the IRS questioned. Electronic records can also be useful if they are complete, easy to read and accurate.
Documents that challenge the IRS findings
Read the IRS notice carefully to see what changed and why. Then gather documents that address each adjustment directly.
If you already sent information to the IRS, keep copies of that correspondence. Certified mail receipts or delivery confirmations may help show when records were submitted. A written explanation can also help connect the facts in your case to the tax rules that apply.
For some correspondence audits, the IRS offers an audit reconsideration process that lets taxpayers submit more information if they disagree with the result.
Deadlines matter
IRS notices usually include response deadlines. Missing a deadline can limit your options for challenging the adjustment or using certain administrative remedies.
Keep copies of the audit notice, your tax return, supporting records and all IRS communications in one place. Good organization can make it easier to respond on time and avoid missing key details.
When professional help may be useful
A tax attorney or tax professional can review the audit findings, identify the records you still need and help you decide whether audit reconsideration, an appeal or another response is the best next step. If you disagree with an IRS audit decision, the strongest response is usually a simple one: records, facts and a clear explanation.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[How long does an IRS tax audit take?]]>https://www.morgansebastianlaw.com/?p=480512026-09-16T07:37:05Z2026-09-16T07:37:05ZWhat affects the audit timeline?
The IRS uses different audit methods. A correspondence audit happens by mail and may be limited to a specific item on your return. An office audit takes place with an IRS examiner and may cover more issues. A field audit is more detailed and usually involves an examination of records at your home, place of business or your representative's office.
The type of audit can affect how quickly the IRS reaches a decision. Other factors include the number of issues under review, the amount of documentation involved and whether the IRS requests information about additional tax years.
What can make an audit take longer?
Several issues can extend the process:
Incomplete records: Missing receipts, statements or other documents may require additional requests.
Complex returns: Returns involving businesses, investments, multiple income sources or international transactions may require more review.
Additional questions: The IRS may raise new questions after reviewing the information you provide.
Multiple tax years: The IRS may expand the examination beyond the original year when the circumstances support it.
Disagreement over proposed changes: If you disagree with the IRS findings, resolving the dispute can add time.
Under federal law, the IRS generally has specific periods in which it can assess additional tax, but exceptions and special circumstances can affect those periods.
What happens when the IRS reaches a decision
An audit does not always end with additional tax. The IRS may accept your return as filed, propose changes or request further information before making a decision. Responding accurately and meeting stated deadlines can help prevent unnecessary delays.
The key point is that an IRS audit has no fixed duration. Understanding the type of audit and responding carefully can help you know what to expect as the process moves forward.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[What to do after receiving IRS Notice CP14 in California]]>https://www.morgansebastianlaw.com/?p=480492026-08-30T22:24:55Z2026-08-30T22:24:55ZWhat does a CP14 notice mean?
A CP14 shows the tax period in question, the unpaid balance and any penalties or interest the IRS has added to the account. Taxpayers generally have 21 days from the notice date to pay what is owed or contact the IRS – the specific due date appears on the notice itself. Until the debt is fully resolved, interest and penalties continue to build on the outstanding balance.
What steps should you take immediately?
Review the notice to confirm the tax year and balance match your records. If the amount is correct and you can pay in full, doing so stops further interest. If full payment is not possible, contact the IRS before the deadline – early action may help prevent enforced collection measures such as liens or levies.
What are your options if you cannot pay in full?
The IRS offers programs when full payment is not possible. Eligibility depends on your income, expenses, assets and tax history.
Installment agreement: Pay in monthly installments. Interest and penalties accrue until paid in full.
Offer in Compromise: Settle for less than the full amount. The IRS reviews your finances – not all applicants qualify.
Currently Not Collectible status: Pauses collection if you cannot afford any payment. The debt remains and accruals continue.
Penalty abatement: May waive penalties for reasonable cause or a clean compliance history. Tax and interest still apply.
A CP14 is a serious notice – but it is the start of the collection process, not the end. California taxpayers should also be aware that an unpaid federal tax balance may prompt separate contact from the California Franchise Tax Board if state taxes are also outstanding.
If you dispute the balance or need help evaluating your options, a California tax attorney can review the notice, confirm the debt and recommend an approach that may help you avoid liens, levies or wage garnishments.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[How spouses can address a deceased spouse’s IRS debt]]>https://www.morgansebastianlaw.com/?p=480472026-08-17T13:40:50Z2026-08-17T13:40:50Zliable for the IRS debt of your deceased spouse.
What to consider about a deceased spouse’s IRS debt
California is a community property state, so the law may treat some debts and tax responsibilities acquired during marriages as joint responsibilities. In other words, your responsibility for your deceased spouse’s tax debt depends on how the tax liability occurred and whether you filed a joint tax return. If you may be responsible, you may also have tax relief options, such as:
Innocent spouse relief: This may protect you from tax liabilities that result from your spouse’s incorrect or incomplete tax reporting. In order to qualify for innocent spousal relief, you must satisfy certain IRS requirements. You can generally request relief by filing Form 8857, Request for Innocent Spouse Relief.
Equitable relief: This could be an option if you do not qualify for any other form of spousal relief, but the law may not hold you responsible for the tax liabilities if doing so would be unfair.
Community income relief: This may relieve a spouse of responsibility for debts from community income taxes.
Court-ordered relief: A court order may allocate responsibility for some tax debts between spouses during a divorce or separation. Nevertheless, this is not always binding on the IRS.
IRS payment and settlement options: The IRS has different programs through which an eligible taxpayer can settle their tax problems in a way that suits them best based on their financial situation.
You should determine whether the deceased spouse, the estate or both owe the tax liability based on how you filed the tax returns and what state law requires.
Check your options before paying IRS debt
IRS debt after a spouse’s death can involve both federal tax rules and California estate matters. Before paying the debt with your own money, you can get a legal consultation to evaluate your tax obligation and potential estate and tax relief options. This may help you avoid making payments you are not legally required to make.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[What happens after the IRS files a federal tax lien?]]>https://www.morgansebastianlaw.com/?p=480432026-08-10T12:15:27Z2026-08-10T12:15:27ZReceiving notice that the IRS has filed a federal tax lien can raise many questions. You may worry about your property, your finances or what the IRS might do next. When the IRS records a Notice of Federal Tax Lien (NFTL), it publicly documents the government's claim against your property because of unpaid federal taxes. Knowing what this filing means and what may follow can help you make informed decisions.
What a federal tax lien means
A federal tax lien is the government's legal interest in your property when you have unpaid federal taxes. The claim may extend to a wide range of assets, including your residence, automobiles, business property, financial assets and real estate. It may also reach property and rights to property you obtain while the lien remains in effect.The filing does not mean the IRS takes ownership of your assets or immediately removes money from your accounts. Instead, it secures the government's position while the tax obligation remains outstanding. Recognizing this distinction can make it easier to understand the collection process.
How a federal tax lien can affect you
A federal tax lien can affect your finances in several ways:
It can make selling or refinancing property more difficult.
It gives the government priority over certain creditors if you sell property.
It can reduce your ability to qualify for credit, refinance your existing loan and obtain other loans.
It can remain attached to your property until you resolve the tax debt or the collection period ends under federal law.
These consequences can affect both individuals and business owners. Knowing the potential impact can help you prepare for the next stage.
What happens after the lien is filed?
Filing a federal tax lien does not automatically lead to property seizure. The IRS may continue collection efforts while the lien remains in place. Depending on your circumstances, the agency may consider installment arrangements, offers in compromise or other collection alternatives for eligible taxpayers. If the tax debt remains unresolved, the IRS may later take additional collection steps, such as issuing a levy. Unlike a lien, a levy is the legal process by which the IRS may seize certain property or assets to satisfy unpaid taxes.Reading every IRS notice carefully and responding promptly can help you understand your rights and avoid additional collection actions.
Looking ahead
A federal tax lien marks an important point in the collection process, but it does not mean you have lost your property. Understanding how a lien works and what may happen afterward can help you respond with greater confidence. If you have questions about a federal tax lien or the notices you received, consider seeking reliable information before deciding your next steps.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[Can the IRS take my professional license in California?]]>https://www.morgansebastianlaw.com/?p=480292026-08-10T10:28:48Z2026-07-16T06:44:07ZHow does federal and state tax debt affect professional credentials?
Understanding the distinction between federal and state enforcement agencies when exploring these challenges is important. Here are some essential information concerning the factors that jeopardize professional licensing, including:
The IRS cannot take your professional license: Federal law doesn’t give the IRS the authority to suspend state-issued occupational credentials. However, the IRS has the power to freeze your bank account, levy your income or revoke your U.S. passport for severe delinquent debts.
Suspension from being in the “Top 500” list: The state updates a public list of top 500 taxpayers who owe more than $100,000 in state taxes twice a year. If your name ends up on the list, the state could suspend your professional license and even your driver’s license.
Once you receive a preliminary notice of suspension from the Department of Consumer Affairs, You have approximately 90 days to either satisfy the tax obligation or enter into a compliant installment payment plan. If the 90-day window closes without a resolution, your licensing board could place your credentials on hold, freezing your ability to legally work and earn an income in California.
Take control of your tax situation
Tax debts can be overwhelming and time consuming. If you are facing tax-related challenges, it is wise to seek the guidance of an experienced California law attorney as soon as possible. A legal professional can help you understand your rights and protect your peace of mind.
]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[Options for disagreeing with an IRS Audit finding]]>https://www.morgansebastianlaw.com/?p=480252026-08-10T10:28:50Z2026-06-26T17:01:59ZUnderstanding the audit results notice
The IRS communicates its findings through official notices, such as a "30-day letter." This document outlines proposed changes to your tax return and explains your rights. It serves as a proposal, not a final bill, indicating the auditor has completed their review. The agency provides this notice to give you a chance to respond before taking further action. Ignoring it can lead to more serious collection efforts.
Primary options to dispute audit findings
When you disagree with the audit's conclusion as stated in a 30-day letter, you have several options. If you do not respond, the IRS will typically issue a Statutory Notice of Deficiency or "90-day letter," which allows you to petition the U.S. Tax Court.
Alternatively, you can proactively challenge the findings through other administrative channels. Your options often include:
IRS appeals: This formal process involves requesting a conference with the IRS Office of Appeals. An independent appeals officer, who was not involved in the original audit, will review your case. It provides an opportunity to present your arguments and negotiate a settlement without going to court.
Audit reconsideration: You can request this path if you have new information to present that the auditor did not consider. You can also use it if you did not appear for the original audit or did not provide the requested information.
Both of these options have strict deadlines and documentation requirements.
Developing your post-audit strategy
Challenging an IRS decision requires a careful approach. Missing a deadline or submitting incomplete information can weaken your position and limit your future options. The rules for presenting evidence and arguing your case are specific.
An experienced legal professional can help you understand the audit report, gather the necessary documents, and build a strong case for an appeal. Properly addressing an unfavorable audit can prevent the issue from escalating into liens or levies.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[How could you benefit from the IRS’s separation of liability?]]>https://www.morgansebastianlaw.com/?p=480222026-06-23T14:20:01Z2026-06-23T14:20:01ZIf the IRS is seeking payment for a tax understatement connected to a joint return filed during your marriage, the separation of liability relief can come in handy. It is applicable for the taxpayers of California or any other state under specific conditions and circumstances. Here are some key points to understand.
What is the separation of liability relief?
When the IRS identifies a tax understatement on a joint return filed during your marriage, it generally holds both parties liable. However, the separation of liability relief allows a qualifying spouse to break that joint obligation. Once approved, the IRS recalculates the liability so that you are only responsible for the taxes generated by your own financial items, while your ex-spouse remains responsible for their own share.
When can you claim it?
IRS expects you to meet certain prerequisites to be eligible for separation of liability relief. The IRS may consider you qualified if:
You filed joint tax returns with your spouse while you were married.
Your spouse’s error led to an understatement of tax on the joint returns.
You were unaware or had no reason to suspect a tax discrepancy when you signed the return.
Your marriage is dissolved or you don’t live with your spouse.
The statement “you don’t live with your spouse” will be valid only if you and your spouse have lived separately for a minimum of 12 consecutive months before filing.
When might you be ineligible?
The IRS relief is a breather for qualifying individuals. Nevertheless, the IRS will not exempt you from your spouse’s tax due if any of the following apply:
You have signed either an offer in compromise or a closing agreement with the IRS.
You previously requested relief and a court denied the request.
You failed to request the relief during the related court proceeding.
Additionally, if the IRS can prove you had actual knowledge of a specific hidden income source or false deduction when you signed the return, relief will be denied for that specific item, though you may still receive relief for other items you didn't know about.
Take control of your tax responsibility
Tax problems can linger long after a marriage ends, but separation of liability relief provides a pathway toward a fair resolution. You can start by filing the Form 8857 to claim innocent spouse relief from the IRS. It can help you move forward without carrying the full weight of a joint tax debt.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[What if you have unfiled California tax returns?]]>https://www.morgansebastianlaw.com/?p=480192026-06-05T08:45:40Z2026-06-05T08:45:40ZWhy unfiled returns can get expensive
The agency uses specialized programs to identify people who earned income but did not meet state filing requirements. If you owe back taxes, penalties and interest can add up quickly.
A late-filing charge is 5% of the unpaid balance for each month the return remains overdue, up to a maximum of 25%. If the return is more than 60 days late, the state imposes a minimum penalty of $135 or 100% of the tax due, whichever is less.
Interest also accrues on unpaid balances. If you fail to respond to a formal Demand for Tax Return, the FTB may assess a 25% demand penalty. However, for individual taxpayers, this penalty is typically only applied if you also failed to respond to a similar demand in any of the four prior tax years.
Waiting can also affect refunds. The state generally gives you until the later of the following dates to claim a refund: four years from the original due date or one year from the date you overpaid.
How to start fixing the problem
Start by gathering documents that show your income, payments and possible deductions, including:
W-2s, 1099s and business income records
Prior tax returns
Payment records
Documents supporting deductions or credits
If the FTB issued a Notice of Proposed Assessment, review the tax year, amount and response deadline. You can then file the missing returns and address any balance.
If you cannot pay everything at once, the FTB offers installment agreement options for eligible taxpayers.
Take action before collection escalates
Unfiled returns rarely become easier to fix with time. Getting back into compliance can help limit additional penalties and interest, replace FTB estimates with accurate information and give you a clearer path toward resolving the debt.]]>On Behalf of Morgan Sebastian Law, PC<![CDATA[How to protect your home office from a tax audit]]>https://www.morgansebastianlaw.com/?p=480162026-05-26T09:12:32Z2026-05-26T09:12:32ZWhy compartmentalization is important
In California, the FTB requires a separate identifiable space for home office expenses. You can use that condition to designate a space in your home for exclusive and regular use.
When going by that requirement, the desk in the corner of your bedroom can count as a home office. However, your kitchen table where you also eat dinner does not. Making that distinction is crucial to remain compliant.
What documents to prepare
Compiling current and relevant evidence can help prove the legitimacy of your home office. You can provide visual proof by preparing before and after photos of your workspace to demonstrate exclusive use.
Building a digital folder for your utility bills, lease agreements and receipts can show your business operations. You can also maintain a basic calendar showing that you regularly worked from that space. Creating this paper trail can help safeguard you from a tax audit.
Hustling with confidence
Facing a tax audit does not have to end with you losing your home office. Seeking legal guidance can help you maintain precise documentation while crafting your response to auditors. The right support and preparation allows you to focus on running your business.]]>