Sacramento Tax Lawyer Real Estate Industry
Operating in the real estate industry requires having knowledge of a plethora of laws that govern the industry. This is especially true if your real estate dealings are triggering a number of tax code provisions. Fortunately, our tax lawyers can help you if you are concerned about your tax situation. If you require assistance to manage taxes as part of your real estate business, contact an experienced Sacramento tax lawyer for the real estate industry.
At the NewPoint Law Group, LLP, we are committed to providing your business with the legal representation that you deserve. We recognize the difficulty of operating a business and remaining compliant with a wide range of tax laws, and we are here to handle your tax needs. To schedule a confidential consultation to discuss your tax situation, contact the NewPoint Law Group, LLP at 800-358-0305. You can also contact the firm by using our online submission form.
Common Real Estate Industry Tax Law Issues
Interpreting the tax code can be a difficult task for a person that is unfamiliar with the broad range of regulations enforced by the Internal Revenue Service (IRS). Additionally, California’s State Board of Equalization (BoE) also enforces many tax regulations that can affect a company involved in the real estate industry. Fortunately, our firm can help you navigate these tax issues. The following is a list of common real estate tax issues our firm can help you resolve.
Property Tax Exemptions
Property taxes apply to real property and even possessory interests in real property. In California, real property is defined as the possession of land, mines, mineral rights, and also improvements made to a structure. Possessory interests are defined as private interests in publicly owned lands, like retail stores, ski resorts, harbor leases, and many other interests. Possessory interests are taxable when a person or entity owns an interest in nontaxable publicly owned real property.
However, there are many property tax exemptions that can apply to property owned by a taxpayer. For example, California provides taxpayers with a homeowners’ exemption. If a taxpayer meets the requirements, they can receive a $7,000 reduction of taxable valuable if the home is used as the owner’s primary residence. However, this exemption is not available for rental homes or vacation properties that are only occupied for a limited time throughout the year.
California has also provided taxpayers with a church exemption. The church exemption applies to land or real property that is used solely as a place of religious worship. If the property is used for other activities unrelated to religious worship, the exemption will not apply.
There are other properties that can subject to a property exemption:
- Nonprofit colleges and schools
- Free libraries and museums
- Burial plots
This is not an exhaustive list.
Tax Liens and Levies
If a taxpayer fails to pay back taxes owed to the IRS, the IRS may eventually place a lien on the property they own. A tax lien can be placed on all the property owned by a person or entity. This means if you fail to pay property taxes on real estate that you own, the IRS can place a tax lien on that estate and other estates you own. Additionally, the IRS will notify your creditors of the lien, which can result in your credit score substantially dropping.
Fortunately, the IRS provides a taxpayer with a certain amount of time to pay the tax debt to have the lien released from the property. Once the tax debt is paid, the lien will be released within 30 days. However, if a taxpayer fails to pay their tax debt, the IRS may decide to proceed with a tax levy.
A tax levy occurs when a taxpayer’s property is seized in order to pay off their tax debt. This means your real estate and all your other assets can be taken by the IRS. If your assets are levied, you may still have time to recover the property.
The IRS does not use tax liens, tax levies, or prosecution for tax evasion as a first resort. Instead, the IRS would prefer to work with taxpayers to manage their tax debt. Once you receive notice of a tax lien, you should contact an experienced tax attorney immediately. Our firm can help you explore your legal options to avoid having your assets seized.
If you are operating a real estate business, it is vital that you comply with all tax regulations that apply to your industry. If you make a mistake when reporting taxes or if you consistently report a loss of income, your business could become the target of a tax audit.
We understand that the process of a tax audit can worry a business owner. However, we can help guide you through this process. In many cases, the IRS will simply require clarification for previous tax decisions. However, there are some instances where a taxpayer can leave a tax audit with a large tax bill.
Consult with Our Sacramento Tax Lawyers for the Real Estate Industry
If your real estate business requires legal assistance to handle tax matters, you should consult with an experienced Sacramento real estate tax attorney as soon as possible. The legal team at the NewPoint Law Group, LLP possess decades of combined legal experience, and we would be pleased to use this knowledge to represent you. To schedule a confidential legal consultation to discuss your case, contact the NewPoint Law Group, LLP at 800-358-0305. You can also contact the firm online.