Tax Attorney in Billings, MT

This is the single most common Billings-area trigger for a CP2000 notice under the IRS Automated Underreporter program. Bakken and Williston Basin operators report gross royalty payments on Form 1099-MISC Box 2 without accounting for the gathering, processing, transportation, and marketing costs that should flow through to the royalty owner's economic interest. The royalty owner who properly applies IRC §613A percentage depletion and post-production cost adjustments may report a substantially lower net royalty on Schedule E, and the IRS computer matches the operator's gross figure against the lower net figure and proposes a deficiency. The corrective path is documentary: division orders, monthly remittance statements, post-production cost itemizations, and operator-side correspondence. A CP2000 response with a clean reconciliation usually closes the file without further action. If the IRS opens a field audit, the substantiation burden becomes heavier and a Form 4549 protest may be needed.

Different rates and rules. For crude oil and natural gas, IRC §613A allows a percentage-depletion deduction of 15 percent of gross income from the property, available only to independent producers and royalty owners (integrated oil companies are barred), capped at 1,000 barrels per day of oil equivalent and limited to 65 percent of total taxable income from all sources. For coal, IRC §613 allows percentage depletion at 10 percent of gross income from the property, available to all producers and royalty owners without the independent-producer restriction, subject to the 50-percent-of-net-income-from-the-property limit. Both calculations sit alongside cost-depletion under IRC §612, and the taxpayer takes the greater of the two each year. Coal and oil-gas depletion is not interchangeable; the rate and the limit differ, and applying the wrong framework triggers an accuracy-related penalty under IRC §6662.

Because the LLC defeated the working-interest passive-activity exception. IRC §469(c)(3) excludes a working interest in any oil or gas property from passive-activity loss limits, but only if the taxpayer holds the interest through an entity that does not limit the liability of the holder. A limited-liability company (LLC) limits liability by definition, which collapses the exception. Limited partners in a limited partnership similarly lose the exception (general partners do not). If you want intangible drilling cost (IDC) expensing under IRC §263(c) to offset W-2 or 1099 physician income from Billings Clinic, you need a non-limited-liability structure: a general partnership, a sole proprietorship with direct fractional working interest, or a tenancy-in-common with operator-side joint operating agreement. Restructuring is sometimes possible mid-project, but the working-interest exception must apply during the year the loss is claimed.

It depends on the source of the income. Under Squire v. Capoeman, 351 U.S. 1 (1956), income derived directly from restricted allotment land held in trust by the United States for an individual Indian is exempt from federal income tax. Grazing leases, mineral royalties, timber sales, and agricultural income from the trust allotment itself fall within the exemption. Wages earned working on the reservation for a tribal enterprise, a federal employer, or a private employer are not exempt — they are federally taxable. IGRA per-capita gaming distributions under 25 USC §2710(b)(3) are federally taxable. Under McClanahan v. Arizona State Tax Commission, 411 U.S. 164 (1973), Montana cannot tax the income of an enrolled member earned on the member's own reservation. The federal-versus-state analysis runs on different rules and frequently produces a return that owes federal tax but not Montana income tax. Documentation matters: tribal enrollment certification, residence-on-reservation evidence, and source-of-income substantiation are all routinely requested in audit.

The U.S. Tax Court holds Billings sessions at the James F. Battin U.S. Courthouse, 2601 2nd Avenue North, Billings MT 59101. Billings is a designated trial city, but sessions occur on a less frequent rotation than Helena, the state capital, where the Tax Court schedules its principal Montana sittings. A petitioner designates Billings or Helena as the preferred place of trial on the petition under Tax Court Rule 140. Helena is roughly 230 miles west of Billings; the choice usually turns on scheduling speed against travel-and-witness convenience. Small-tax-case procedure under IRC §7463 is available for deficiencies of $50,000 or less per year per period and uses simplified evidentiary rules.

Under Mont. Code Ann. §15-2-201, a taxpayer who disagrees with a final agency determination from the Montana Department of Revenue generally has 30 days from the date of the determination to file a petition with the Montana Tax Appeal Board. The MTAB at 125 N Roberts Street, Helena MT 59601, is structurally separate from the Department of Revenue under Mont. Code Ann. §15-2-101 — the Board reports to its own chair and members rather than up the Department chain, which gives administrative review more credibility than in states where the hearing officer reports to the auditor. Missing the 30-day window forfeits administrative review entirely and the assessment becomes final. Decisions of the MTAB are appealable to the Montana district courts and ultimately the Montana Supreme Court. Because Montana is not VTL's home jurisdiction, post-MTAB district-court litigation is handled in coordination with Montana-admitted counsel.

It removes one category of liability but adds others. Montana is one of only five U.S. states (with Alaska, Delaware, New Hampshire, and Oregon) without a general state sales tax, which eliminates the most common state-side trust-fund exposure for retailers, restaurants, and service businesses. There is no sales-tax responsible-party assessment under a Montana parallel to other states' §6672-equivalents. However, Montana imposes the Oil and Natural Gas Production Tax, the Coal Severance Tax, the Resource Indemnity and Ground Water Assessment Tax, a lodging facility use tax, and a local-option Resort Tax of up to 3 percent in qualified resort communities under Mont. Code Ann. Title 7 Chapter 6 Part 4 (relevant for Big Sky, Whitefish, and West Yellowstone, not Billings itself). Failure to remit any of those trust-collected taxes can produce a Montana responsible-person assessment parallel to a federal Trust Fund Recovery Penalty under IRC §6672. The federal trust-fund analysis remains identical regardless of the state sales-tax position.

No. Montana has no state estate tax and no state inheritance tax. Federal estate-tax exposure remains for estates exceeding the inflation-adjusted unified credit (approximately $13.99 million per person in 2026 under current law, scheduled to sunset to roughly half that amount unless Congress acts). For Billings ranch families holding appreciated Yellowstone County and Carbon County land, mineral interests, or substantial royalty-streams, the IRC §1014 step-up at death and the IRC §2032A special-use valuation election (which can value family farmland at agricultural-use rather than highest-and-best subdivision value, subject to a ten-year recapture period) are the two principal planning levers. IRC §6166 deferred-payment election for closely-held-business estate tax allows up to 14 years to pay the estate tax attributable to a closely-held active business or working ranch.

Two different mechanics. 1099 locum-tenens, call-coverage, telehealth, or independent-contractor income from Billings Clinic, St. Vincent Healthcare, or Mayo Clinic Care Network research stipends triggers self-employment tax under IRC §1401 at the combined 15.3 percent rate (12.4 percent OASDI up to the wage base, 2.9 percent Medicare with the 0.9 percent additional Medicare tax under IRC §3101(b)(2) above the threshold). Quarterly estimated tax under IRC §6654 applies. The 1099 income also runs through the IRC §199A qualified-business-income analysis, but health is a Specified Service Trade or Business (SSTB), which phases the deduction out above the income thresholds. RSU compensation from a Mayo-affiliated research role is reported on Form W-2 Box 1 with Box 12 code V at vest, taxed as ordinary income, and basis on later sale equals the vest-date value — not zero, despite what some 1099-Bs default to. Double-counted basis on RSU sales remains the most common CP2000 trigger in this category.

Yes. A levy under IRC §6331 reaches property and rights to property held by or for the taxpayer, including bank, savings, and credit-union accounts. Once Stockman Bank, First Interstate Bank, Yellowstone Bank, U.S. Bank, or another Billings-area institution receives a levy, the financial institution segregates the account and holds funds for 21 days under IRC §6332(c) before remittance. Acting in the 21-day window matters: a properly-filed CDP request, an accepted CNC, an accepted IA, or an accepted OIC suspends the levy before the bank remits. For royalty-income filers, royalty-payor levies served on Bakken or Powder River operators reach the next monthly remittance immediately and require separate Form 12153 or Form 9423 engagement to release.

Probably yes for the federal trust-fund portion. IRC §6672 assesses a Trust Fund Recovery Penalty against any "responsible person" who "willfully" failed to pay over withheld taxes — the FICA and federal income-tax withholding portion of Form 941. The IRS conducts a Form 4180 interview to identify responsible persons. Anyone with check-signing authority, payroll-decision authority, or knowledge of the unpaid taxes can be assessed personally — that means founders, head-of-finance, and sometimes a controller. For Billings restaurants, retail, oil-and-gas-services contractors, and construction outfits, this often catches multiple people because cap-table authority and check-signing authority overlap. On the state side, Montana Department of Revenue pursues withholding under Mont. Code Ann. Title 15 Chapter 30 Part 25, with parallel responsible-person reach.

Yes. IRC §7345 authorizes the IRS to certify "seriously delinquent" tax debt — currently $62,000 for 2026, indexed for inflation — to the State Department, which may then deny passport renewal or revoke an active passport. The certification reverses when the debt is paid, an IA is in place, an accepted OIC is in force, an active CDP hearing is pending, or Innocent Spouse Relief is in process. Bakken operators with Canadian vendor footprints, Billings Clinic physicians with international medical-mission travel, Mayo Clinic Care Network research staff on overseas rotations, and Hispanic and Native families with cross-border travel obligations all face real exposure. Decertification typically processes within 30 days once a qualifying resolution is in place.

Federal tax-resolution fees vary by matter complexity. A straightforward Installment Agreement typically falls between $1,500 and $3,500. A full Offer in Compromise with Form 433 financial analysis runs $4,000 to $7,500. Audit defense depends on the audit type and the number of issues. A U.S. Tax Court petition with case workup and trial preparation generally starts at $6,000 and rises with case complexity. Multi-year royalty 1099 reconciliation audits and Bakken working-interest IDC disputes run higher because the documentary record is heavier. A combined federal-plus-Montana-DOR matter runs higher than a federal-only matter because it involves two agencies and two statutes. VTL provides a written fee quote after the free consultation. Cal Bar Rule 7.1 prohibits comparisons claiming we are cheaper or faster than competitors without verifiable substantiation, so we do not market on price.

Yes. Communications between you and a licensed attorney for the purpose of seeking legal advice are protected by federal common-law attorney-client privilege, subject to the usual exceptions (crime-fraud, waiver, third-party presence). The narrower federally-authorized tax practitioner privilege under IRC §7525 applies to non-attorney CPAs and EAs but does not extend to criminal-tax matters or to written tax-shelter communications. An attorney handling your tax case retains the broader privilege that survives criminal investigation, which matters significantly if a civil audit shifts to a Criminal Investigation Division referral — a pattern that appears in willful-FBAR cases, high-volume crypto cases, and royalty 1099 substantiation disputes that show a pattern of repeated mischaracterization.

For administrative correspondence with the Montana Department of Revenue and the petition filed with the Montana Tax Appeal Board within 30 days of a final agency determination, taxpayers may be represented by an attorney, CPA, or enrolled agent under a Montana Form POA. The MTAB itself permits non-attorney representation in many matters. For judicial review in the Montana district courts or the Montana Supreme Court, an attorney admitted in Montana is required. VTL handles the federal side of overlapping matters and the administrative Department of Revenue and MTAB side under Montana POA, then refers to Montana-admitted counsel where state-court litigation is necessary. Most Montana Department of Revenue disputes resolve at the protest or MTAB stage without reaching state court.