Alec Baldwin Accused Of Avoiding New York Sales Tax On Painting Purchase

March 6, 2017 Shamsey Oloko Leave a comment Tax Evasion, Tax Fraud, Tax fraud & evasion, Tax News

Donald Trump certainly has a few tax issues looming over him as he takes over the Oval Office. Alec Baldwin, known for his impersonation of Trump during the months leading up to the election, coincidentally also has an issue regarding the payment of taxes, specifically tax evasion.

In 2010, Baldwin purchased the Bleckner painting “Sea and Mirror” for $190,000. In September of 2016, Baldwin sued New York City art dealer Mary Boone alleging that Boone delivered a similar Bleckner work, but not “Sea and Mirror.” Baldwin alleges in his complaint that Boone promised to obtain the painting from an unnamed collector, but instead delivered a different piece of artwork, also painted by Bleckner. Baldwin is seeking damages measured by the difference between the purchase price of the painting Boone sold him and the current value of the original “Sea and Mirror.”

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Most Confusing Parts Of The Income Tax Code, Part 2: Alternative Minimum Tax

March 3, 2017 Shamsey Oloko Leave a comment Alternative Minimum Tax (AMT)

Many provisions of the Internal Revenue Code are complicated. Proper interpretation of the rules and regulations contained in these provisions requires the assistance of an experienced and knowledgeable tax professional. The second part of our series about the most confusing provisions of the Internal Revenue Code addresses everyone’s favorite, the alternative minimum tax.

Why Is It Confusing?

The AMT doesn’t seem to achieve its purpose
Taxpayers have to compute two taxes
The computation of the AMT itself is enormously long and complicated

This is a preview of Most Confusing Parts Of The Income Tax Code, Part 2: Alternative Minimum Tax. Read the full post (681 words, 1 image, estimated 2:43 mins reading time)

Moving To Canada? Here Are Your Tax Consequences

March 1, 2017 Shamsey Oloko Leave a comment FATCA, FBAR, Foreign Earned Income, Foreign Financial Account, Foreign Housing Exclusions & Deductions, Foreign Tax Credit, Tax Evasion, Tax Information Exchange Agreement

After the presidential election, some citizens planned on renouncing their citizenship and moving abroad to Canada, or elsewhere. It would be interesting to survey those who stated this proposition to see if they followed through on their promise (or threat).

The Immigration and Nationality Act applies to U.S. citizens who exercise the right to voluntarily renounce their U.S. citizenship. However, potential relocating Americans must realize that renouncing American citizenship has profound implications on any future return to the United States. Why? Signing an oath of renunciation is an irrevocable act for Americans over the age of 18. Despite this serious implication, the number of individuals that renounced their citizenship in 2015 was eighteen times as many Americans that renounced their citizenship in 2008, which set yet another record for the third consecutive year.

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Can You Defer Your 2016 Income To 2017?

February 27, 2017 Shamsey Oloko Leave a comment Deferred Income, Income, Income Tax, Income Tax Return, Nonqualified Deferred Income

The end of the year is the perfect time for taxpayers to make financial adjustments to lower their tax bill for the current year. Making adjustments to income may help reduce tax liability. Income is typically taxed in the year it is received, however, if you don’t have to pay tax today and may pay it tomorrow, why not? Deferring income is an excellent strategy to lower an annual tax bill. However, only taxpayers that expect their tax bracket to remain the same or decrease to a lower bracket should defer income.

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Most Confusing Parts Of The Income Tax Code, Part 1: Passive Activity Loss Rules

February 24, 2017 Shamsey Oloko Leave a comment News

Many provisions of the Internal Revenue Code are complicated. Proper interpretation of the rules and regulations contained in these provisions requires the assistance of an experienced and knowledgeable tax professional. The first part of the series about the most confusing provisions of the Internal Revenue Code addresses passive activity loss rules.

Why Is It Confusing?

Many exceptions
Understanding defined terms
Calculating losses over time is complicated and cumbersome

A passive activity is any rental activity or any business in which a taxpayer does not materially participate. Nonpassive activities include businesses in which the taxpayer works on a regular, continuous, and substantial basis. Passive income does not include wages, salaries, portfolio, or investment income.

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Form 1040, Line 61 And Non-Resident Taxpayers

February 22, 2017 Shamsey Oloko Leave a comment Filing Status, Form 1040, Form 8965

Like resident taxpayers, U.S. taxpayers living abroad must complete Line 61 under “Other Taxes” and “Health care: individual responsibility” on their Form 1040 or equivalent. For 2016, the IRS will not consider a return complete and accurate if the taxpayer does not report health care coverage for the year, an exemption or a payment. However, U.S. citizens filing as non-residents in foreign countries while covered by an employee health plan, or even by a foreign country’s national health care system, have different considerations when complying with the requirements of the Affordable Care Act of 2010 (“ACA”).

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How Much Is My 2016 Shared Responsibility Payment?

February 20, 2017 Shamsey Oloko Leave a comment Affordable Care Act

The Affordable Care Act of 2010 introduced the shared responsibility payment on non-exempt American citizens who do not meet certain healthcare insurance minimum coverage requirements. The IRS will not consider a return complete and accurate if the taxpayer does not report health care coverage for the year, an exemption or a payment.

Taxpayers must either:

Have qualifying health care coverage for every month of 2016 (including for dependents);
Qualify for an exemption from the requirement to have health care coverage; or
Make a “shared responsibility payment.”

This shared responsibility payment increases annually, and for the 2016 tax year, is the greater of:

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An Introduction To The Most Confusing Parts Of The Income Tax Code

February 17, 2017 Shamsey Oloko Leave a comment Internal Revenue Code

The Internal Revenue Code and its accompanying regulations are voluminous. Of course, many of these rules affect the ordinary individual American taxpayer. There may be no more daunting component of federal law than the Tax Code and the volumes of regulations that detail it. Many provisions are confusing, to say the least, and may require certain additional paperwork such as a long worksheet or form.

It’s no surprise that a substantial number of provisions of the Tax Code have a history of high taxpayer error and fraud. When you add to the equation the fact that law, especially tax law, is constantly evolving, a taxpayer’s confusion related to the interpretation of tax regulations may be significant and require the assistance of an experienced tax professional.

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Tax Consequences Of Child Support Payments For Payors And Recipients

February 15, 2017 Shamsey Oloko Leave a comment Child Support

Individuals must consider the tax consequences of obligations related to child support in divorce proceedings. The fact that child support payments are not deductible and the receipt of child support is not taxable sometimes creates spousal bitterness and discord in a divorce case. In this situation, the prevalent issue is the conflict between the payor’s desire to characterize his or her payment as an income tax deductible payment of alimony, while the payee-spouse wishes to treat the payment as a tax-free receipt of child support.

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Tax Consequences Of Alimony Payments For Payors And Recipients

February 13, 2017 Shamsey Oloko Leave a comment Alimony deduction

Individuals must consider the tax consequences of obligations related to spousal support or maintenance, also known as alimony, in divorce proceedings. Many soon to be ex-spouses often fail to realize that there are tax consequences for these types of payments, which may cause further economic hardship and even emotional stress.

Spousal support typically refers to the money a legally married spouse pays to the other spouse while they are still married. Spousal support may last as long as the marriage continues. Spousal maintenance consists of payments an ex-spouse pays to his or her ex-spouse after the dissolution of the marriage. The amount and duration of spousal maintenance are defined in the divorce decree. Some states refer to spousal maintenance as alimony. It often is used as a generic term to describe both types of support and will be used as such in this blog.

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