Inglewood Tax Attorney

Tax Attorney’s Review of Tax Problems in Inglewood

Inglewood, California, a vibrant city in Los Angeles County, is home to a diverse and thriving business community. From the bustling corridors of Market Street to the innovative enterprises near the SoFi Stadium and Hollywood Park, Inglewood’s economy is dynamic, with small to medium-sized businesses, including retailers, restaurants, and cannabis-related ventures, driving local growth. However, with this vibrancy comes the complexity of tax compliance, and businesses in Inglewood often face unique tax challenges. At Tax Lawyers Group, APC, we are deeply rooted in the Inglewood community and committed to helping our clients navigate these challenges with confidence.

Common Tax Problems in Inglewood

Inglewood’s businesses, ranging from family-owned shops to emerging cannabis dispensaries, encounter a variety of tax-related issues. Here are some of the most prevalent challenges:

1. Sales Tax Audits by the California Department of Tax and Fee Administration (CDTFA)
   The CDTFA has intensified its focus on sales tax audits, particularly for small to medium-sized businesses in Inglewood. Retailers, restaurants, and service providers along La Brea Avenue or near the Forum often face scrutiny to ensure accurate reporting of sales tax. These audits aim to confirm that businesses have correctly reported taxable sales and remitted the appropriate tax to the state. Errors, such as underreporting sales or misclassifying exempt sales, can lead to significant penalties. Inglewood’s combined sales tax rate of 10.25% (including state, county, and city components) adds complexity, especially for businesses handling cash transactions or navigating nexus rules for out-of-state sales.
2. IRS Tax Audits Targeting Small Businesses
   The Internal Revenue Service (IRS) frequently targets small businesses in Inglewood, particularly those in industries like retail, real estate, and hospitality, which are prevalent in areas like downtown Inglewood. IRS audits often focus on verifying income accuracy and expense deductions. For example, a local restaurant may be audited to ensure that cash tips are properly reported, or a contractor near the Inglewood Transit Connector project may face scrutiny over claimed business expenses. Audits can be triggered by discrepancies in income-to-expense ratios compared to similar businesses or by prior tax issues. The risk of criminal prosecution looms if significant underreporting is uncovered, making professional representation critical.
3. Cannabis Tax Compliance
   Inglewood’s growing cannabis industry, spurred by the city’s progressive stance on cannabis retail, faces unique tax challenges. Cannabis businesses must comply with local cannabis tax rates, which vary based on gross receipts (e.g., 2.5% for manufacturers or up to $7 per square foot for cultivators). Sales tax audits for cannabis retailers are particularly rigorous, as the CDTFA seeks to ensure compliance with both state and local tax ordinances. Failure to maintain meticulous records can lead to audits escalating into criminal tax fraud investigations, especially given the cash-heavy nature of the industry.
4. Franchise Tax Board (FTB) Audits
   The California Franchise Tax Board often conducts audits that piggyback on IRS findings, but they also initiate independent reviews, particularly for businesses with complex residency or income allocation issues. For instance, a business owner who recently moved to Inglewood to capitalize on the city’s economic growth may face an FTB audit questioning their California residency status or net operating losses. These audits can result in unexpectedly large tax bills if not handled proactively.
5. Payroll and Employment Tax Issues
   Inglewood businesses, especially those in construction or hospitality tied to major developments like the Intuit Dome, often face Employment Development Department (EDD) audits to verify compliance with payroll tax obligations. Misclassification of employees as independent contractors or failure to withhold proper taxes can lead to substantial penalties. These issues are particularly common among businesses scaling up to meet the demands of Inglewood’s revitalization projects.
6. Tax Liens and Levies
   Unresolved tax debts can lead “[to] tax liens, levies, or even garnishment of wages,” placing significant financial strain on Inglewood businesses. For example, a local retailer struggling with cash flow after the economic impacts of COVID-19 may face an IRS or FTB levy, restricting access to bank accounts or wages. Prompt action, such as negotiating an offer in compromise or installment agreement, is essential to mitigate these consequences.

Business Tax Audits in Inglewood

Being audited by the IRS, CDTFA, FTB, or EDD can be a stressful experience for Inglewood business owners. Tax Audits are not only time-consuming but can also lead to significant financial and emotional stress. The process often involves detailed record reviews, with auditors examining bank statements, sales ledgers, and expense receipts to identify discrepancies. For businesses with cash-heavy operations, such as those in Inglewood’s vibrant retail or dining scenes, tax auditors may probe deeply to ensure all income is reported.

Local Expertise from Tax Lawyers Group, APC

At Tax Lawyers Group, APC, we pride ourselves on being an integral part of the Inglewood business community. Our office, conveniently located near Century City at 2049 Century Park East Suite 2525, Los Angeles, CA 90067, is just a short drive from Inglewood, making it easy for local business owners to meet with us in person or via Zoom. We understand the unique challenges faced by Inglewood’s entrepreneurs, from the mom-and-pop shops on Manchester Boulevard to the innovative startups near the Metro K Line.

Our team, led by seasoned tax attorney Victor J. Yoo, includes former IRS Revenue Agents, Certified Public Accountants, and attorneys with decades of experience from some of the nation’s top tax law firms. We have a proven track record of success, having represented over 1,700 clients in tax audits, appeals, and resolutions. Our deep ties to Inglewood are reflected in our active engagement with local business associations, such as the Inglewood Chamber of Commerce, and our understanding of the city’s economic landscape, including its revitalization efforts and the impact of major projects like the SoFi Stadium and Intuit Dome.

We are well-versed in local tax ordinances, such as Inglewood’s business tax certificate requirements and cannabis tax regulations, ensuring that our clients remain compliant while minimizing tax liabilities. Whether you’re a retailer navigating a CDTFA sales tax audit or a contractor facing an IRS income audit, we tailor our strategies to the specific needs of Inglewood businesses.

How Your Tax Attorney Can Help Your Business:

Facing a tax problem or audit can feel overwhelming, but you don’t have to go it alone. Here’s how we can assist Inglewood businesses:

• Tax Audit Defense: We represent you before the IRS, CDTFA, FTB, or EDD, and advocating for your rights as a taxpayer to achieve the “no change” status for the audit.
• Criminal Tax Defense: If your audit escalates to a criminal investigation, our experienced attorneys can protect you from felony charges related to tax fraud or evasion.
• Tax Resolution: We negotiate offers in compromise, installment agreements, or lien releases to resolve tax debts and levies, helping you regain financial stability.
• Cannabis Tax Compliance: We provide confidential guidance to cannabis businesses, ensuring compliance with Inglewood’s municipal tax codes and defending against aggressive CDTFA audits.
• Appeals and Litigation: If you disagree with tax audit’s findings, we represent clients in filing appeals with the IRS Appeals Office or litigate in Tax Court.

Discuss Your Case With a Inglewood Tax Attorney

Inglewood’s business community is the heartbeat of our city, and at Tax Lawyers Group, APC, we are dedicated to helping you thrive amidst tax challenges. Whether you’re facing an audit, struggling with tax debt, or seeking to ensure compliance, our tax lawyers are here to provide personalized, cost-effective solutions. Don’t let a tax problem derail your business—contact us today for a confidential consultation.

We’ll protect your business and keep it soaring in the City of Champions.

About Tax Lawyers Group, APC
Tax Lawyers Group, APC, is a premier tax law firm serving Inglewood and greater Los Angeles with unparalleled expertise in IRS, CDTFA, FTB, and EDD matters. Voted among the top tax lawyers by Best of Long Beach and Best of South Bay, and featured in NBC News and the Daily Journal, we are committed to delivering superior legal service to our local business community.