Tax Attorney in Birmingham, AL

No. Federal IRS practice is governed by 31 CFR Part 10 (Treasury Circular 230). Any attorney admitted to practice in any U.S. jurisdiction may represent any taxpayer before the IRS in any state, including Alabama, through a Form 2848 Power of Attorney. The U.S. Tax Court admits attorneys on a national basis and holds Alabama trial sessions in Birmingham at the Hugo Black U.S. Courthouse. Alabama-bar admission is required for Alabama state-court litigation and Alabama Tax Tribunal proceedings — those pieces are referred to local AL counsel. The federal piece, which is the majority of tax-controversy work, does not require Alabama admission.

Yes. Alabama imposes a graduated personal income tax under Ala. Code §40-18-5, with brackets running from 2% to a 5% top rate at $40,000 for joint filers ($3,000 for single filers). Alabama corporate income tax is a flat 6.5% under Ala. Code §40-18-31. Alabama also imposes the Alabama Business Privilege Tax under Ala. Code §40-14A, based on net worth apportioned to Alabama. Alabama sales tax is 4% state-level; Jefferson County adds 1% and the City of Birmingham adds 4%, for a 9% combined rate inside city limits. Alabama repealed its state inheritance tax effective 2002, so only federal estate tax applies at death.

Alabama is the only state in the country that allows a full deduction of federal income tax actually paid on the state personal return, under Ala. Code §40-18-15(a)(20). Two other states (Iowa, Louisiana) historically allowed partial deductions but Alabama's full-deduction position is structurally unique. The practical effect for a Birmingham filer: when the federal liability rises — through an IRS audit adjustment, an unpaid balance turning into an assessment, or a Tax Court deficiency — the Alabama AGI base falls. This shrinks the effective Alabama tax on the same gross income. We model this interaction before recommending an Offer in Compromise or accepting an audit adjustment, because the AL state-tax impact may swing materially in your favor or against you depending on the federal posture.

The U.S. Tax Court calendars trial sessions in Birmingham at the Hugo L. Black U.S. Courthouse, 1729 5th Avenue North. A Birmingham petitioner designates Birmingham as the preferred place of trial on the petition under Tax Court Rule 140. Pre-trial conferences and case-management work happen by phone or video; the only in-person appearance is calendar call and trial itself. Many Tax Court cases settle before reaching trial. For Mobile and the Gulf Coast end of Alabama, the closest alternative is Mobile or Atlanta sessions; Birmingham is the primary Alabama trial city.

The Alabama Tax Tribunal was created under Ala. Code §40-2B-1, enacted in 2014, as an independent state-tax tribunal that adjudicates disputes between taxpayers and the Alabama Department of Revenue (and certain local taxing jurisdictions). It replaced the prior Administrative Law Division inside the Department of Revenue, moving tax adjudication out of the same agency that issued the assessment. A taxpayer challenging a final AL DOR assessment must file a notice of appeal with the Tribunal within 30 days of the date the assessment becomes final, under Ala. Code §40-2B-2. Miss the 30-day window and the assessment hardens into a final judgment enforceable against Jefferson County real and personal property. VTL handles the federal piece and refers the Tribunal piece to local Alabama counsel.

Yes. The IRS audits federal income, federal employment, and federal excise tax. The Alabama DOR audits state personal income tax under Ala. Code §40-18-5, state corporate income tax under §40-18-31 at 6.5%, Business Privilege Tax under §40-14A, sales-and-use tax, and severance tax on coal, oil, and gas production. The two agencies share information through information-exchange agreements, so an IRS Form 4549 adjustment frequently triggers an AL DOR notice within months. Alabama requires reporting federal adjustments to AL DOR under Ala. Code §40-18-43 with an extended state assessment window keyed to the federal change. A Birmingham auto-supplier business can face simultaneous Form 941 IRS payroll exam and AL DOR sales-tax field audit.

Yes. Personal-use casualty losses are deductible under IRC §165(h) only when attributable to a federally declared disaster. The April 27, 2011 Alabama tornado outbreak (FEMA-1971-DR-AL), the March 3, 2019 Lee County EF-4 (FEMA-4419-DR-AL), the March 2023 Selma outbreak, and the March 2025 central Alabama outbreak all qualify. The deduction is the lesser of basis or fair-market-value decline, reduced by insurance and other recoveries, then by the $100 per casualty floor and the 10% of AGI floor. Some Birmingham filers can amend prior-year returns under IRC §165(i) to claim the loss in the disaster year. Involuntary-conversion gain deferral under IRC §1033 is available where insurance proceeds exceed basis on damaged Pratt City or Pleasant Grove real property. The choice between disaster-year and following-year reporting changes the tax outcome materially.

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, not the employer's matching share. 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. On the state side, Alabama sales-tax responsible-person liability operates under Ala. Code §40-23-25 for entities that collected state sales tax in trust and failed to remit. Auto-supplier and steel-industry contractor LLCs sometimes have this fact pattern after a plant shutdown or contract gap ends with unpaid wages.

Yes. IRC §7345 authorizes the IRS to certify "seriously delinquent" tax debt — currently $62,000 for 2026, indexed for inflation — to the U.S. State Department, which may then deny passport renewal or revoke an active passport. The certification reverses when the debt is paid, an Installment Agreement is in place, an accepted Offer in Compromise is in force, an active CDP hearing is pending, or Innocent Spouse Relief is in process. For Birmingham Mercedes-Benz, Hyundai, Honda, and Toyota assignees with international rotations to Stuttgart, Seoul, Tokyo, and Pune, UAB clinical-trial physicians with European site visits, and Regions and Protective Life corporate-banking officers with global wire authority, decertification is often the most urgent step in the engagement.

For a UAB Medical Center attending, St. Vincent's hospitalist, Brookwood Baptist specialist, or Children's of Alabama subspecialist working under a 1099-NEC contract, the tax stack is: federal income tax at progressive rates topping out at 37% (plus the 0.9% additional Medicare tax on wages and SE income above $200,000 single / $250,000 joint), plus 15.3% self-employment tax under IRC §1401 on the first $168,600 of net SE earnings (2024 figure; indexed), plus the 2.9% Medicare portion above that, plus Alabama state income tax at up to 5% — but reduced by the Alabama federal income tax deduction under §40-18-15(a)(20). Net effective rate frequently exceeds 42% before deductions, but the AL federal deduction is the relief valve that keeps Alabama lower than Georgia and Tennessee neighbors. Quarterly estimates under IRC §6654 are mandatory; missing them triggers underpayment penalties. We routinely set up retirement-plan strategies (solo 401(k), SEP-IRA, defined-benefit plans where compensation supports it), qualified-business-income deductions under IRC §199A where the specified-service-trade-or-business limits permit, and clinical-trial royalty income planning for UAB-licensed inventions.

A German, Korean, or Japanese national on a multi-year assignment to Mercedes-Benz Tuscaloosa, Hyundai Montgomery, Honda Lincoln, or Toyota Huntsville generally becomes a U.S. resident under the substantial-presence test of IRC §7701(b). That triggers worldwide-income reporting on Form 1040, FBAR (FinCEN Form 114) on foreign accounts, and Form 8938 on foreign financial assets. The tax-treaty positions matter: the U.S.-Germany, U.S.-Korea, and U.S.-Japan treaties each contain Article 15 (dependent personal services) provisions that can override default residency in narrow assignment patterns. Form 1116 foreign tax credit claims under IRC §901 offset double taxation. RSU vesting on Mercedes-Benz Group AG, Hyundai Motor, Honda Motor, or Toyota Motor parent shares creates a U.S.-source compensation event tied to the assignment period. We coordinate with the assignment-tax provider (frequently Big Four) on the underlying return; our role is the IRS controversy or back-tax piece when balances accumulate.

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 number of issues. A U.S. Tax Court petition with case workup and trial preparation generally starts at $6,000 and rises with complexity. We provide a written fee quote after the free consultation. Cal Bar Rule 7.1 prohibits price comparisons unless backed by verifiable substantiation, so we do not market on price — we market on the work product and the case files behind it.

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, etc.). 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. An attorney handling your Birmingham tax case retains the broader privilege that survives criminal investigation — a meaningful difference if the audit develops fraud indicators or if a referral to the IRS Criminal Investigation division becomes possible.

Yes, generally. IRC §6331(k)(1) suspends levy action while a processable Offer is pending and for 30 days after a rejection, and during any timely-filed Appeals review of a rejection. The IRS will not levy your Birmingham bank account or wages while the Offer is being evaluated. However, the IRS may still file a Notice of Federal Tax Lien during the OIC pendency to protect its position in your Jefferson County real estate or other assets. The CSED is also tolled during the pendency. A poorly-prepared OIC that gets returned (not rejected) does not provide the same protection — processability is the key threshold.

Yes, for Tribunal litigation. The Alabama Tax Tribunal operates under Ala. Code §40-2B-1 and following as an independent state-tax tribunal. Petitions to challenge an Alabama Department of Revenue final assessment must be filed within 30 days under Ala. Code §40-2B-2 — one of the tightest state-tax appeal windows in the country. Representation before the Tribunal generally requires Alabama-licensed counsel or, for limited matters, an authorized representative under Tribunal rules. Judicial review of a Tribunal order proceeds in the Alabama Circuit Court (typically Jefferson County for Birmingham filers) and requires Alabama admission. VTL handles the federal side of overlapping Birmingham matters and coordinates with Alabama counsel for the Tribunal piece. Many AL DOR disputes resolve at the protest stage with the Department's Legal Division before any Tribunal petition is filed.

Coal royalty income from Brookwood No. 4, Warrior Met Coal operations, Oak Grove, and Black Warrior Basin leases is reported on Form 1099-MISC and is taxable as ordinary income under IRC §61(a) or as capital gain under IRC §631(c) where the royalty owner retains an economic interest and meets the holding-period and disposal requirements. Percentage depletion under IRC §613 at 10% for coal applies for qualifying small producers, subject to the 50%-of-taxable-income limit. Mine development costs are deductible under IRC §616; exploration expenditures under IRC §617. Coal producers shipping metallurgical coal also owe Federal Black Lung excise tax under IRC §4121. The IRS audits the percentage-versus-cost depletion election and the §631(c) capital-gain treatment regularly in this corridor. Alabama severance tax on coal under Ala. Code §40-13-31 and following applies on the state side.