Tax Lawyer's Blog

From the TaxProf, Paul Caron:
Congressmen John Carter (R-TX) and Lynn Westmoreland (R-GA) yesterday introduced the Geithner Penalty Waiver Act, requiring that the IRS assess the same penalty against U.S. taxpayers that came forward in the UBS tax fraud investigation as paid by Treasury Secretary Timothy Geithner for failing to pay taxes on his IMF income — [...]

Bookmark & Share:

[Read more →]

Section 4.10.63.5.3 of the Internal Revenue Manual  is titled Reliance on Representative and/or Return Preparer and provides in part that,
In considering the failure to file penalty, the United States Supreme Court has held that the fact that a taxpayer relies on an attorney to file a timely tax return does not relieve the taxpayer of the [...]

Bookmark & Share:

[Read more →]

There are no more extensions.
In addition to previously extended corporate (1120) and trust (1041) tax returns, S Corporation (1120S) and partnership (1065) tax returns are due today.
Most IRS late filing penalties are calculated as a percentage of the unpaid tax shown on the return.
But S Corporations and partnerships don’t pay tax so does that mean taxpayers can file those tax [...]

Bookmark & Share:

[Read more →]

The deadline for foreign investors to participate in the IRS voluntary disclosure program is September 23, 2009.
Taxpayers wishing to participate must amend their income tax returns to properly reflect any previously unreported foreign earned income and must file the appropriate foreign account disclosures.
If you want your CPA or tax attorney to represent you in this [...]

Bookmark & Share:

[Read more →]

The Wall Street Journal reports that the IRS is dedicating an entire division to investigate and pursue offshore tax evaders:
For anyone who wonders if the Internal Revenue Service is done with offshore accounts now that it got its UBS AG (UBS) settlement, there’s this.
The agency has started putting together a new group to focus on [...]

Bookmark & Share:

[Read more →]

Under current law if a taxpayer can show that his failure to comply with a tax law was due to reasonable cause (i.e. not the result of willful negligence), the penalties will be abated.
James Peaslee in a column written for the Wall Street Journal says that there are provisions hidden in the House’s healthcare reform bill that [...]

Bookmark & Share:

[Read more →]

William Perez of the About.com Guide to Tax Planning reports that,
Individuals who buy a home for the first time before December 1, 2009, qualify for a federal tax credit worth up to $8,000. The first time home buyer tax credit is fully refundable, and people can amend their 2008 tax return to claim an additional [...]

Bookmark & Share:

[Read more →]

The GAO recently issued a report to the U.S. Senate Finance Committee titled Tax Administration – IRS Should Evaluate Penalties and Develop a Plan to Focus its Efforts.
Here is what ranking member Senator Chuck Grassley (R-Iowa) said about the issue:
The IRS has a lot of discretion over assessing and rescinding tax penalties. The IRS promises to [...]

Bookmark & Share:

[Read more →]

Russ Fox of Taxable Talk reminds us that the deadline for U.S. taxpayers to report their ownership interest in a foreign financial account is June 30, 2009.  That’s just five days from now so don’t procrastinate.
Â
Get it done.
Â
Now!
Â
So Russ, who needs to file and what is the procedure for filing?
 

If you have a foreign financial account, or [...]

Bookmark & Share:

[Read more →]

Martha Stewart’s daughter is suing her CPA for $334,000 for incorrectly preparing her 2002 income tax return.
In 2006 she was audited and the IRS determined that there was a deficiency of $737,000 in the tax she paid on her capital gains.
Ms. Stewart was assessed interest on the underpayment of $143,000 and underpayment penalties of $295,000.
This is [...]

Bookmark & Share:

[Read more →]