The Tax Alternative Group LLC is a Specialty Tax Practice. We handle complex tax situations that require competence and experience and do it from a risk-informed compliance and audit defense standpoint. We Diagnose the situation, Research the tax law, Develop Tax Strategies, and Maintain Compliance by Filing Tax Returns and Responding to Notices and inquiries.
Unlike most tax preparers, we aren’t just putting numbers on a form. We understand what the numbers mean and how they affect the calculations that determine the tax. We understand compliance issues, audit flags, and common error traps. We prepare accurate returns and defend them vigorously when challenged – because we are familiar with the legal authorities that dictate proper treatment. These legal authorities include the Internal Revenue Code, Treasury Regulations, Revenue Rulings, and Court Cases.
We are Enrolled Agents, licensed by the US Department of the Treasury, to represent taxpayers in matters before the Internal Revenue Service. Enrolled Agents demonstrate proficiency in Individual Taxation, Business Taxations, and IRS Practice and Procedure by passing a rigorous three-part exam before licensure. Enrolled Agents are also licensed to practice in all 50 states. Enrolled Agents, Attorneys, and CPA are held to the highest ethical standards of practice under the Circular 230 Regulations.
ADVANCED TAX PREPARATION ISSUES
We handle tax situations that many other tax professionals do not understand, are not licensed to handle, or prefer not to get involved with because of the complexity, time commitment, or risks involved in tax resolution.
Most tax preparers focus on the bottom line – how much is the refund, or how much is owed. Less attention is placed on proper reporting or understanding what created the tax situation. When the taxpayer doesn’t understand what drives the tax situation, they have lost their opportunity to mitigate and refine their biggest expense – their tax liability.
Complex returns are usually identified as those that involve various forms and schedules. This often involves:
- The Self-Employed (Sch C and Sch SE)
- Sale of Stocks, Bonds, and other Capital Assets (Sch D and Form 8949)
- Owners of Rental Properties (Sch E)
- Famers (Sch F)
- Household Employers (Sch H)
- Excessive Itemized Deductions (Sch A)
- Those subject to the Alternative Minimum Tax (Form 6251)
OTHER FACTORS REQUIRING A TAX SPECIALIST
Significant Life Events often create barriers to the ordinary care needed in proper tax reporting, and once taxpayers get behind, it becomes a confluence of events that often get in the way of prompt resolution. We have the knowledge and experience to resolve the issues and help you get your life back together.
Small Business Owners
Small Business is the backbone of the US Economy. Congress specifically put special deductions, credits, and “loopholes” in the tax code to promote small business. Small Business Owners need a tax pro that does more than put numbers on a form. As a specialty tax firm, we understand the numbers and the way they affect the tax liability. We can often make suggestions to help restructure transactions to reduce taxable income. We particularly enjoy working with the following Small Business Owners:
- Building and Construction Contractors
- Engineers and Architects
- Professional Service Providers (Doctors, Lawyers, Consultants, etc.)
Real Estate Professional
Real Estate transactions may be very profitable if structured properly. The Tax Code has many incentives for owners of Real Estate. These activities include owning Rental Properties, Flipping Houses, and Real Estate Development.
The term “Real Estate Professional” is a special designation by the IRS that is often misunderstood by taxpayers and tax preparers alike. Properly applied, it can provide significant tax savings necessary to make this type of investment profitable.
Professional Investors (Day Traders)
Professional Investors (Day Traders) earn the bulk of their income through buying and selling short-term securities. These short-term transactions are taxed as ordinary income and taxed at higher rates than long-term gains. This activity requires a knowledgeable tax specialist to implement an appropriate strategy to maximize deductions, credits, and loopholes.
We provide Personal Fiduciary Services and advice and act in your best interests. This is particularly important when dealing with a Decedent’s Final Return, managing a Decedent’s Estate, preparing Trust Returns, and dealing with Life Estate Issues. These activities require advanced knowledge to ensure compliance and protect the rights of the estate, executor, trustee, and beneficiaries.
Multi-State Income Tax Filings -- All 50 states
We are experienced in multi-state tax filings for taxpayers that have income in a variety of states. State tax issues are often more complicated than federal tax problems and required advanced knowledge, training, and experience. Some of the taxpayers that benefit from our specialty tax service include:
- Union Contractors from Hiring Halls
- Transient workers
- Specialty Contractors
- Performing Artists, Cinematographers, and Sound Engineers
- Traveling healthcare workers
- Owners of out of state rental properties
PROACTIVE TAX PLANNING
A Key Element of a Specialty Tax Firm is “Tax Planning” – the act of understanding the relationship between tax law and financial decisions. We provide “Issue-Specific” and “Comprehensive” tax planning to help mitigate the tax consequences of financial transactions.
Issue-specific tax planning usually involves single issues, such as “Should I Covert my IRA to a Roth” or “What’s the best way for me to liquidate my assets to minimize the tax.” We meet with the client to understand the issue; research the issue and any questions; and follow up with a written response, model, or examples.
Comprehensive tax planning involves looking at the “big picture” and develop strategies to help the taxpayer meet their individual goals while maximizing deductions, credit, and loopholes. We meet with the client to understand their situation; research the issues and any questions; develop models to evaluate tax savings; produce a written plan with proven tax strategies, and assist with implementation.
Comprehensive Tax Planning often involves a review if the following elements
- Entity Structure
- Tax Deductions
- Tax Credits
- Legal Loopholes
- Expense Reimbursement
- Retirement Savings
- Timing of Transactions
- Documentation & Audit Proofing
A key element of a Specialty Tax Firm is being able to defend items on the tax returns or elements of tax planning when challenged by the IRS. Representing Taxpayers requires being licensed as an Enrolled Agent, Attorney, or CPA. Enrolled Agents are licensed by the US Treasury to represent taxpayers in all 50 states. Attorneys and CPA are generally limited to practicing in the state that issued their license.
Representing Taxpayers requires knowledge of the law and IRS practice and procedure. Knowledge of the law helps protect the taxpayer’s rights, understand the requirements for proper treatment of a tax item, and how to defend taxpayer positions. Knowledge of IRS practice and procedure helps identify and predict inquiry, requirements, and responses of IRS employees. These are the rules the IRS is required to follow. When properly understood, these rules may be used to control almost any situation.
Tax law and authority include the Internal Revenue Code, Treasury Regulations, Revenue Rulings, Treasury Decisions, US Tax Court Cases, and higher court decisions. We also use other sources of lesser authority to help us understand IRS positions under certain facts and circumstances.
IRS practice and procedure involves understanding the “IRS Playbook” – The Internal Revenue Manual. The IRS also have a variety of “Policies” that define their mission, values, priorities, and deference that can often be used as a means to strengthen the taxpayer position.