DEFINITION

• Taxation involves regulation from the federal government to the local school district. Each governmental entity imposes some type of taxation requirement in order to raise the revenue required to fulfill its governmental function.

• A tax is a charge by the government on the income of an individual, corporation or trust, as well as the value of an estate or gift. The objective in assessing tax is to generate revenue to be used for the needs of the public. A tax is not a voluntary payment but an enforced contribution exacted pursuant to legislative authority.

• The Internal Revenue Code is the body of law that codifies all federal tax laws, such as income, estate, gift and excise taxes. Such laws comprise Title 26 of the U.S. Code and are implemented by the Internal Revenue Service (IRS).

• The IRS is responsible for administering and enforcing the internal revenue laws. It is part of the Department of the Treasury. Basic IRS activities include providing taxpayer service and education; determination, assessment and collection of internal revenue taxes; determination of pension plan qualifications and exempt organization status; and preparation and issuance of rulings and regulations to interpret the provisions of the Internal Revenue Code.

FIND A TAX LAWYER IN YOUR AREA.

More information on Taxes and the IRS

RELATED PRACTICE AREAS

Securities Law
Business & Commercial Law
Banking & Finance Law

BUZZWORDS

Capital Gains Tax - A tax on income derived from the sale of a capital asset, like real estate holdings or investments.

Estate Tax - The tax imposed on the property of a deceased person who transfers property by will or intestate succession.

Gift Tax - A tax imposed on the transfer of property by gift. Such tax is imposed upon the donor of a gift and is based on the fair market value of the property on the date of the gift.

Payroll Tax - A tax on an employee's salary or on the income of a self-employed individual. Federal and state income taxes are paid by the employee or the self-employed individual; Social Security taxes are paid both by the employer and the employee.

Sales Tax - A state or local-level tax on the retail sale of specified property or services.

Tax Court - The court that tries and adjudicates controversies involving the existence of deficiencies in or overpayment of taxes.

Tax Evasion - Illegally paying less in taxes than the law permits or committing fraud in filing taxes.

Tax-Exempt - Property used for educational, religious or charitable purposes that is ordinarily exempt from assessment for taxes.

Tax Fraud - Federal offense of willfully attempting to evade or defeat the payment of taxes due and owing.

Tax Lien - A lien on real estate that may be foreclosed for nonpayment in favor of a state or local government.

PRACTICE AREA NOTES

• Tax attorneys have an in-depth knowledge of the Tax Code and follow the changes in every area (code, cases, regulations, rulings) of Tax Law as they develop.
• Tax litigation may be civil or criminal. For example, in civil fraud cases, the IRS may impose monetary penalties, such as interest or other fines. If the case is criminal in nature, i.e., done deliberately and with criminal intent, fines and/or imprisonment may be imposed.