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Current Affairs

Do you HAVE to make a streamlined disclosure to the IRS? What happens if you don't?

2018-05-17

The IRS rules by fear and intimidation. Because of this, tens of thousands of US expatriates who learned they were in non-compliance and took the steps to rectify the situation. However, there are countless US expats who would love to be in tax compliance, but simply can’t afford the cost of hiring a firm like ours to help them submit their Streamlined “Foreign” Submission. Once such person is our latest podcast guest, "Julio." Julio has decided to definitely NOT be in compliance. His reasons are well-known to many US expats, perhaps not so well-known to Congress.

IRS tax relief programs 2018: Answers to the most common questions

2018-05-03

If you are looking for some sort of IRS tax amnesty, there are changes and new proposed changes to the law to consider. With Tax Reform passed in 2017, and a new IRS Tax Relief Act (The Taxpayer First Act of 2018) being proposed, now more than ever it is essential if that you understand how IRS tax settlements actually work. In this article we will review the various IRS initiatives, answer some of the very basic and more advanced questions about how to deal with back taxes, penalties and interest, and the issues that arise from owing the IRS money or larger fears.

Desperate for revenue, Connecticut Revenue Services blasts out Fresh Start audit letters

2018-04-23

The IRS Fresh Start program has been a marketing success --- for the IRS. Despite the IRS Fresh Start Program not really being a program, just slightly different settlement guidelines, taxpayers' interest in making a "Fresh Start" has been significant. Following suit are states like Connecticut, with their own claimed "Fresh Start program." In this article we will discuss just how different the approaches are and what to do if Connecticut asks you to make a Fresh Start.

Tax audit red flags: separating fact from fiction

2018-03-13

It is that time of the year again, when the early tax filing season is upon us and interest not he IRS is at a yearly high. In response, you will see article published claiming to give you the “secret sauce” on how to avoid an IRS tax audit, by warning you of “red flags.” There articles are all fine, I suppose, if this was 2008. However, the IRS has changed drastically since then. In this article, we will discuss what the real audit red flags are, and what is just sort of things are outdated.

Manafort & Gates faces MORE criminal charges for failure to file an FBAR

2018-02-22

UPDATE: In a 77-paragraph indictment, Special Prosecutor Robert Mueller announced on February 22, 2018 that even more FBAR and Bank Secrecy Act criminal charges against Paul Manafort and Robert Gates for conduct that preceded their involvement in the 2016 president election. Today’s news that a Grand Jury returned an indictment against Paul Manafort and Richard Gates confirms my observation that too many high profile individuals are still not filing FBAR forms at significant risks. While many have learned that FBARs can result in significant civil penalties, today’s indictment reminds us that there can be criminal charges for failing to file an FBAR as well. In this article, I'm going to answer what an FBAR is, the uphill road Manafort and Gates have, and what steps to take if you should have filed an FBAR but did not.

Desperate for revenue, Connecticut DRS makes a bold move sending notices to Newegg customers

2018-02-13

If you're a Connecticut resident, chances are you've been shortchanging the State Treasury each year when you file your state income tax return, most likely without even realizing it. With the increasing ubiquity of the online marketplace and the convenience that online shopping offers, many have turned to the internet to buy all manner of goods and services. The fact that many online retailers do not charge sales tax on purchases is seen by many to be an extra incentive to shop online. However, what many do not realize is that just because your go-to online store doesn't charge you sales tax doesn't mean that you're off the hook for paying taxes. Connecticut law requires you to self-report the purchase and pay use tax in lieu of sales tax. For years, many have flouted this requirement with little to no consequence, as means of effective enforcement simply did not exist. However, this week the Connecticut DRS made waves by sending out use tax assessments for prior years to customers of at least one online retailer: Newegg.com.

How does the new IRS Qualified Business Income deduction work?

2018-01-22

The 2017 Tax Cuts and Jobs Act (otherwise knowns as the 2017 tax reform) includes a fantastic tax benefit for many entrepreneurs, self-employed individuals, and investors by allowing them to deduct 20% of their business income. The problem is that the rules are incredibly complicated. In this article, we will explain the basics of how it works and under which circumstances you may want to consult with a tax advisor so that you can best take advantage of this new tax break.

You don't need tax reform to find insane tax rates

2017-12-11

With tax reform in the news, the media has found an interest in various absurdities the new law will create. For instance, with an progressive higher tax rates and a phase out of deductions, those who earn just over a million dollars have an effective marginal tax rate of 100%. But this outrage speaks to an unfortunate ignorance of our current tax code. For there are far greater outrages that are currently the law. In this article I will explain one of them --- how it is possible to be taxed when you have a loss.

Answers to common IRS W-4 Form questions

2017-11-15

In support of the argument that there is nothing simple about the IRS, in this article I examine the seemingly ‘simple’ IRS W-4 Form, an Employee's Withholding Allowance Certificate. This is the form an employee fills out to indicate his tax situation to the employer so that the employer knows the “correct” amount of tax to withhold from an employee's paycheck. But like anything involving the IRS, things can get complicated and in a hurry.

Why this tax attorney will never be an IRS whistleblower

2017-11-13

According to at least one US tax professional, the IRS is beginning a campaign to encourage tax professionals to whistle-blow on their clients. I find this horrific. It encourages a complete breach of trust and will work to further diminish the entire profession. In this article I will lay out my exact reasoning why I may do think unconventionally, but I will never be a whistle-blower and encourage all tax professionals to follow suit.

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