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Part 2 – What If: Debt Related Life Events And Struggling Taxpayers

Leave a comment Bankruptcy, Civil Liabilities, Civil Penalties, Criminal Liabilities, Debt Cancellation, Debt Forgiveness, Delinquent Taxes, Representation, Tax Abatement

If you have any type of financial difficulty, keep in mind that there’s a tax impact to events such as job loss or foreclosure. Such consequences may not necessarily be predominantly negative. For example, if your income decreased, you may be newly eligible for the Earned Income Tax Credit or other tax credits, which is a good thing.

Of the utmost importance when facing some financial obstacle is to contact the IRS immediately if you believe that you may have trouble paying your tax bill. Please see our blog You Can’t Pay Your Tax Bill in Full  You Have Options…An experienced and knowledgeable tax attorney may help ease any financial burden. Remember that to avoid additional penalties, you also should always file a tax return even if you are unable to pay.

This is a preview of Part 2 – What If: Debt Related Life Events And Struggling Taxpayers. Read the full post (416 words, 1 image, estimated 1:40 mins reading time)

Part 1 – What If: Job Related Life Events And Struggling Taxpayers

Leave a comment Civil Liabilities, Collection Activities, Criminal Liabilities, Debt Forgiveness, Delinquent Taxes, Earned Income Tax Credit (EITC), IRA, Representation

If you have any type of financial difficulty, keep in mind that there’s a tax impact to events such as job loss or foreclosure. Such consequences may not necessarily be predominantly negative. For example, if your income decreased, you may be newly eligible for the Earned Income Tax Credit or other tax credits, which is a good thing.

Of the utmost importance when facing some financial obstacle is to contact the IRS immediately if you believe that you may have trouble paying your tax bill. Please see our blog You Can’t Pay Your Tax Bill in Full  You Have Options…An experienced and knowledgeable tax attorney may help ease any financial burden. Remember that to avoid additional penalties, you also should always file a tax return even if you are unable to pay.

This is a preview of Part 1 – What If: Job Related Life Events And Struggling Taxpayers. Read the full post (526 words, 1 image, estimated 2:06 mins reading time)

Red Flags That Attract IRS Auditors

Leave a comment Audit, Business Expenses, Charitable Contributions, Civil Liabilities, Civil Penalties, Collection Activities, Criminal Liabilities, Deductions, Earned Income Tax Credit (EITC), Fraudulent Return, Home Office, Income Tax, Representation, Tax Evasion, Tax Fraud, Tax fraud & evasion, Taxable Income

People typically think that the amount of their income is the biggest red flag that attracts an IRS auditor, and they would probably be right. But what are some of the other items on a tax return that may attract their attention? Some say that simple, plain returns are fairly safe and likely to avoid extended scrutiny by IRS auditors. According to the IRS, there are multiple ways a return may end up audited, here are some examples:

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Erin Andrews Wins A $55 Million Verdict…Now For The IRS Bill

Leave a comment Damages, Emotional Distress, Income, Income Tax, News, Punitive Damages, Representation, Taxable Income

In early March, after a two-week trial and eight hours of deliberations, a Nashville jury awarded TV sports reporter Erin Andrews $55 million in damages for her lawsuit against a Nashville hotel after she was videotaped in 2008 without her knowledge. Andrews sued for $75 million in damages for negligent infliction of emotional distress and invasion of privacy.

This is a preview of Erin Andrews Wins A $55 Million Verdict…Now For The IRS Bill. Read the full post (430 words, 1 image, estimated 1:43 mins reading time)

Pushing It To The Limit: Odd, Unusual And Crazy Tax Deductions

Leave a comment Audit, Business Expense, Business Expenses, Charitable Contributions, Civil Liabilities, Civil Penalties, Criminal Liabilities, Deductions, Fraudulent Return, Frivolous Return Program, Home Office, Income Tax, Medical Expenses, Ordinary and Necessary Expenses, Representation, Tax Fraud

Working at the IRS or representing clients before the IRS has its perks and advantages. Having the opportunity to observe all of the outlandish and bizarre attempts by taxpayers to assert legitimate,valid tax deductions is rare. On one hand, it certainly may involve the observance of a unique form of comedy. Here are some odd, crazy, unusual, and please note, unsuccessful tax deductions:

*Crazy Home Office Deductions
A woman that ran a home business tried to deduct what was basically her home refrigerator. She explained to her tax professional that she kept drinks in the refrigerator for customers and other business associates that came to the home office for meetings. According to the owner, this occurred four or five times a year while the refrigerator was in her kitchen and served her family.

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Hulk Hogan Wins $140 Million. Windfall For The IRS (And Lawyers) Too.

Leave a comment Damages, Deductions, Income, Punitive Damages, Representation, Taxable Income

A Florida jury awarded Terry Bollea, much better known as Hulk Hogan, $115 million in a lawsuit against Gawker Media for publishing footage of him participating in sexual activity four years ago. Jurors found that the defendant acted with reckless disregard publishing the video and awarded Hogan $60 million for emotional distress and $55 million for economic injury. This could increase as jurors still have to reconvene and deliberate whether punitive damages are appropriate.

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Fail to Turn Over Payroll Taxes To The IRS? You Could Be Looking At Jail Time

Leave a comment Audit, Civil Liabilities, Civil Penalties, Criminal Liabilities, Employment Taxes, Representation, Trust Fund Recovery Penalty

An employer is required to withhold federal income and payroll taxes from its employees’ wages for payment to the IRS. Payroll taxes such as federal income taxes and FICA (Federal Insurance Contributions Act) taxes, both withheld by an employer, are held in trust until the employer makes a federal deposit of these amounts. The IRS applies a term, “Trust Fund Recovery Penalty” or TFRP, well-known by employers, to describe the fine for employer’s willful failure to remit payroll taxes.

This is a preview of Fail to Turn Over Payroll Taxes To The IRS? You Could Be Looking At Jail Time. Read the full post (584 words, 1 image, estimated 2:20 mins reading time)

Qualifying for IRS Innocent Spouse Relief

Leave a comment Civil Liabilities, Civil Penalties, Criminal Liabilities, Damages, Filing Status, Income Tax, Innocent Spouse Relief, Punitive Damages, Representation, Tax Evasion, Tax Fraud

When married taxpayers file jointly, which is often done because of certain benefits available to couples filing jointly, both taxpayers are jointly and severally liable for the tax and any additions to tax, interest, or penalties that arise from the joint return, even if their marriage is later dissolved. Joint and several liability means that each taxpayer is legally responsible for the entire liability.

Thus, both spouses on a married filing jointly return are generally held responsible for all the tax due even if one spouse earned all the income or erroneously claimed deductions. This is true notwithstanding the provisions of a divorce decree regarding a former spouse’s responsibility for any taxes due on previously filed joint returns. However, in rare cases, a spouse may obtain relief from joint and several liability.

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Unsure if you should go with standard or itemize deductions?

Leave a comment Charitable Contributions, Deductions, Expenses Deductions, Filing Status, Income, Income Tax, Job Search Expenses, Medical Expenses, Moving Expenses, Representation, Taxable Income

Unsure of whether you should use the standard deduction amount, or take the time to itemize deductions? The answer is fairly straightforward; you should itemize deductions if your total deductions are more than the standard deduction amount. Also, you should itemize if you don’t qualify for the standard deduction. Taxpayers should initially calculate itemized deductions and then compare that amount to their standard deduction to determine which provides the greater benefit. A taxpayer may be subject to a limit on some itemized deductions if he or she exceeds the adjusted gross income limits.

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