State & Local Tax Compliance

In today’s budgetary environment, state and local governments are aggressively seeking ways to shore up funding deficits. This often translates into aggressive interpretations and application of tax laws.

Tax Litigation Attorney

Freeman Law aggressively represents clients in state-and-local tax disputes and litigation with the Texas Comptroller. We provide representation at all levels of the state-and-local tax-dispute life cycle, including audits and refund claims, State Office of Administrative Appeals (“SOAH”) and state district court proceedings, and—where necessary—beyond.

Tax Resolution Representation Lawyers, Dallas - Fort Worth

Freeman Law helps clients across a wide range of industries—from SaaS providers to traditional brick-and-mortar businesses—navigate through complex state-and-local tax laws and resolve their tax conflicts. We have experience with a breadth of state taxes, including sales and use taxes, franchise taxes, mixed beverage taxes, and others, and a particular interest in state taxation of electronic commerce, including cloud computing, internet hosting, and software as a service delivery models.

Freeman Law represents clients in the Dallas-Fort Worth area and throughout Texas. Schedule a consultation or call to (214) 984-3410 to discuss your state and local tax concerns.

Multistate and Local Tax Attorney

State and local tax laws and rules are complex and vary from state to state. As states confront budgetary deficits due to declining tax revenues and increased governmental spending, tax authorities are aggressively enforcing state tax laws to recapture lost revenues.

At Freeman Law, our experienced attorneys regularly guide our clients through complex state and local tax issues—issues that are frequently changing as states seek to keep pace with technology and the evolution of business.Staying ahead requires sophisticated legal counsel dedicated to understanding the complex state tax issues that confront businesses and individuals.

As your business expands its footprint by crossing state borders to do business in other states or through a remote workforce, noncompliance with state and local tax can prove costly—at times, it may literally make or break a business model. Overlooked state and local tax obligations may impact the sale of a business or even expose owners and officers to personal liability. Clients need a proactive approach and a strategy to meet the challenges of doing business in multiple states.

At Freeman Law, we are changing the way clients do business. Freeman Law works with clients across all industries, including manufacturing, services, technology, oil and gas, financial services, and real estate. We have experience with state income, franchise, gross receipts, sales and use, withholding, controlling interest transfer and real and personal property taxes, as well as unclaimed property and state tax credits and incentives. We also provide experienced counsel in state tax controversies, audit defense, and state tax litigation. Our knowledgeable professionals provide support through:

  • Nexus studies and analysis
  • State tax due diligence
  • Look-back reviews (reverse tax audits)
  • Negotiating voluntary disclosures
  • Tax registrations
  • Tax dispute resolution
  • Communicating with state and local tax authorities
  • Drafting letter ruling requests
  • State apportionment reviews
  • Public Law 86-272 analyses
  • Taxability analyses
  • Escheat analyses
  • Transactional tax planning
  • Sales and use tax exemption and certificate compliance

Because clients face challenges today like never before, they need counsel and insight that position them to respond to rapidly changing environments. Our attorneys are thought leaders and practical. And with our depth of tax, accounting and business experience, we speak the “language” of business—all in a way that moves the ball forward. With our sophisticated multi-state tax professionals, Freeman Law is there to help navigate complex state tax laws, helping our clients solve their most complex problems.

State and Local Tax FAQs

Q: What is State and Local Tax?

A: The state and local tax (SALT) deduction allows taxpayers of high-tax states to deduct local tax payments on their federal tax returns.  If you're concerned about the impact of these changes, consider working a financial attorney to manage the impact of taxes on your financial plan

Q: Do You Pay Local Taxes Where You Live or Work?

A: Your income tax liability may change based on the state you're in, but you should expect to file taxes for both states: one return as a resident for the state where you live and a separate return as a nonresident for the state where you work.

 

Q: How are Local Taxes Calculated?

A: Calculate local income tax based on your local tax agency's guidelines. Flat rate (percentage): Multiply the flat rate by the employee's taxable wages. Dollar amount: Subtract the dollar amount from the employee's taxable income. Progressive rate: Use tax withholding tables to determine employee's local withholding.

Q: What are Local Taxes Used For?

A: Local taxes fund government services including police and fire services, education and health services, libraries, road maintenance, and other programs and projects which benefit the community at large. Many of these services also receive federal funds in the form of grants.

Q: What Can a Tax Attorney Do for Me?

A: Tax attorneys are lawyers who specialize in the complex and technical field of tax law. They're best for handling technical and legal issues associated with your tax situation. An attorney can step in after you have a problem, but consulting with one in advance can also help you avoid problems in the first place.

Q: Do I Have to Pay State Taxes If I Work Remotely?

A: If you're working remotely you'll only have to file and pay income taxes in the state where you live. Non-resident income tax laws vary on a state-to-state basis, but if the non-resident state is listed on your W-2 form, then you'll likely have to file a non-resident state tax return.

Q: Is There a One Time Tax Forgiveness?

A: Yes, the IRS does offers one time forgiveness, also known as an offer in compromise, the IRS's debt relief program. Have tax debt and wondering if one time forgiveness can help?

Q: Do You Have to File Local Taxes?

A: Yes. If you had wages for the year in question and live in a jurisdiction with an Earned Income tax in place, a local earned income return must be filed by April 15,for the preceding calendar year. (unless the 15th falls on a Saturday or Sunday then the due date becomes the next business day) 

Q: What Happens if You Forget to File Local Taxes?

A: The penalty for not filing taxes (also known as the failure to file penalty, or the late filing penalty) usually is 5% of the tax you owe for each month or part of a month your return is late. The maximum failure to file penalty is 25%.The late payment penalty punishes people who pay their taxes late.

Q: Do You Have to Pay Local Taxes on Unemployment?

A: Like wages, unemployment benefits are counted as part of your income and must be reported on your federal tax return. Unemployment benefits may or may not be taxed on your state tax return depending on where you live. Regardless, you must pay federal taxes on your unemployment benefits.
 
Local governments in several states impose a local income tax. Local taxes are in addition to federal and state income taxes. Local income taxes generally apply to people who live or work in the locality. Local income taxes are typically used to fund local programs, such as education, parks, and community improvement.

Q: Can You Go to Jail for Not Paying Local Taxes?

A: And for good reason—failing to pay your taxes can lead to hefty fines and increased financial problems. But, failing to pay your taxes won't actually put you in jail. In fact, the IRS cannot send you to jail, or file criminal charges against you, for failing to pay your taxes.

Q: Is it Better to Have Taxes Withheld from Unemployment?

A: It may be necessary to file an amended return. If you had taxes withheld on jobless benefits, the federal taxes are withheld at a 10% rate. Those who faced lengthy unemployment in 2020, though, could have received far more in benefits and could still owe some taxes on their unemployment benefit.
Does state tax debt ever go away?
 

Q: State Income Taxes


A: More specifically, the following states do not adhere to this rule: Arizona, California, Colorado, Kentucky, Michigan, Ohio, and Wisconsin have four years from the date you file your return or the date it is due, whichever is later, to assess additional obligations.

Q: Does the IRS Actually Look at Every Tax Return?

A: The IRS does check each and every tax return that is filed. If there are any discrepancies, you will be notified through the mail.

Q: What are 3 Types of Taxes?

A: Tax systems in the U.S. fall into three main categories: Regressive, proportional, and progressive.
 

Q: How is Income Calculated?

A: How to Calculate Annual Income. To calculate an annual salary, multiply the gross pay (before tax deductions) by the number of pay periods per year. For example, if an employee is paid $1,500 per week, his or her annual income would be 1,500 x 52 = $78,000.