Fluent in English, Spanish & Italian | 888-882-9243

call us toll free: 888-8TAXAID

Category Archives: From Live Blog

  • Home
  • Category Archives: "From Live Blog"

Jointly Owned Property By Siblings Subject To IRS Lien

October 15, 2019

A federal district court has held in Dase, (DC AL 9/23/19), that property subject to an IRS lien was jointly owned by a tax debtor and his sister. Therefore, the IRS’s lien only encumbered the tax debtor’s interest in the property.

In 2004, the taxpayer, Scott Dase, entered into a lease-to-own agreement with his parents Walter and Anita to purchase property X, which Walter and Anita owned jointly with a right of survivorship. Under the agreement, Scott was to make monthly payments to his parents until he paid them $63,703, and once Scott paid that amount in full, his parents would convey X to him. 
Before Scott made all the payments under the agreement, first Anita and then Walter died intestate while living in Alabama. After their deaths, Scott continued to make the monthly payments required by the agreement but made them directly to the mortgagee. Scott paid off the $63,703 in 2012, and the mortgage in 2018. 

In 2017, the IRS obtained a default judgment against Scott for unpaid taxes and filed a lien against X. Then, the IRS filed suit seeking to foreclose the lien and sell the property.

The parties also agreed that Scott had an interest in X, but disagreed on the extent of Scott’s interest. The IRS contended that only Scott had an interest in X because he entered into a lease-to-own agreement with his parents before their deaths and fully performed all the obligations under that contract after their deaths; therefore, under Wadsworth, Scott was the sole equitable owner of X, and no interest in the property passed to Ms. K under the Alabama intestacy statute. 
Scott and Ms. K argued that because their parents died intestate before Scott had made all the payments under his lease-to-own agreement with their parents, Scott's only interest in X derived from the Alabama intestacy statute. Therefore, they argued, Scott and Ms. K each owned a one-half interest in X as tenants in common pursuant to that statute. 
The district court held that Scott and Ms. K each acquired a one-half interest in X under Alabama’s intestacy statute because Walter still owned the property when he died as Scott had not fully paid the purchase price under the lease to own agreement. Therefore, the IRS's lien only attached to Scott’s one-half interest in X. 

Have A Tax Problem?
 Contact the Tax Lawyers at 
Marini& Associates, P.A. 

 
 
for a FREE Tax HELP Contact Us at:
www.TaxAid.com or www.OVDPLaw.com 
orToll Free at 888-8TaxAid (888) 882-9243
 
 

 

Read more at: Tax Times blog

IRS Grants Relief and Safe Harbors for Certain Foreign Stock Ownership!

October 15, 2019

On October 2, 2019 we posted, IRS Grants Relief for Certain Foreign Stock Ownership! where we discussed new regulations from the Internal Revenue Service provide relief to some U.S. taxpayers who own stock in certain foreign corporations. Rev. Proc. 2019-40 and the proposed regulations limit the inquiries required by U.S. taxpayers to determine whether certain foreign businesses are controlled foreign corporations.

The Revenue Procedure limits the inquiries required by U.S. persons to determine whether certain foreign corporations are controlled foreign corporations (“CFCs”). The Revenue Procedure also allows certain unrelated minority U.S. shareholders to rely on specified financial statement information to calculate their subpart F and GILTI inclusions and satisfy reporting requirements with respect to certain CFCs if more detailed tax information is not available. It also provides penalty relief to taxpayers in the specified circumstances. 
 

Now according to Law360, this recent guidance from the Internal Revenue Service creates safe harbors for U.S. companies that unexpectedly owned foreign affiliates after Congress passed its tax overhaul, but regulatory authority is still limited in compensating for anti-abuse legislation that seemingly went too far.

The newly issued revenue procedure essentially provides breathing room for companies that found themselves with a CFC solely due to the repeal of Section 958(b)(4), limiting the information they’re required to obtain when filing tax returns. Specialists said the U.S. Department of the Treasury was stuck between its desire to help companies with unexpected CFCs and the need to acknowledge the law, but there’s disagreement over whether the middle ground where the guidance landed is fair.


Treasury’s approach wouldn’t allow companies to ignore the law, but it also wouldn’t saddle them with the full impact of the legislative change, according to Pat Brown, an international tax policy leader at PwC.

The legislative history of the Section 958(b)(4) repeal suggests Congress had only intended to target the perceived abuse of current tax rules. For example, a December 2018 report from the Joint Committee on Taxation cited situations where a foreign company parent takes at least 50% of a CFC’s stock to “decontrol” the entity and convert it to a non-CFC.

Steven Hadjilogiou, a tax partner at McDermott Will & Emery LLP, had no doubt the repeal went too far.
 
He said the Kind of Abuse Outlined in the JCT Report Mostly Related to Planning Techniques that Closely Held Companies used to Avoid CFC Status in Specific Scenarios.

 

But without an actual change to the law, Treasury had to work within its authority to provide relief to U.S. shareholders, which can include people, partnerships and companies, that found themselves with unexpected CFCs.

The proposed regulations aren’t undoing the Section 958(b)(4) repeal, but turning off regulations that cross-reference it in some cases, according to Seth Green, principal and co-leader of the international tax group in KPMG LLP's national tax practice.

The revenue procedure also attempts to provide relief by creating safe harbors for determining whether an offshore company is a CFC due to the repeal, a task that can be challenging for those dealing with opaque foreign affiliates.

Specifically, the guidance “limits inquiries” required by U.S. shareholders to determine whether certain foreign corporations are CFCs, according to the IRS.

The revenue procedure also said the IRS will accept a determination that such a company isn’t a CFC if the shareholder lacks “actual knowledge, statements received and/or reliable publicly available information” that’s enough to determine if ownership requirements are met.

Have a International Tax Problem?
 
 Contact the Tax Lawyers at 

Marini& Associates, P.A. 
 
 
for a FREE Tax HELP Contact Us at:
www.TaxAid.com or www.OVDPLaw.com 
orToll Free at 888-8TaxAid (888) 882-9243



 

Read more at: Tax Times blog

Now that Oct. 15th Deadline is Here – What Can You Do Amount Payment of Taxes?

October 15, 2019

For Taxpayers who requested the six-month filing extension should complete their tax returns and file on or before the Oct. 15 deadline.

About 15 million taxpayers filed for an extension this year. Although Oct. 15 is the last day for most people to file, some may have more time. They include:
 

  • Members of the military and others serving in a combat zone. They typically have 180 days after they leave the combat zone to file returns and pay any taxes due.

  • Taxpayers in federally-declared disaster areas who already had valid extensions. For details, see the disaster relief page on IRS.gov.


Extension filers can file when they are ready and don’t have to wait until Oct. 15 to file. Taxpayers who did not request an extension and have yet to file a 2018 tax return can generally avoid additional penalties and interest by filing the return as soon as possible and paying any taxes owed.

Payment options
IRS Direct Pay offers taxpayers a fast way to pay what they owe. Direct Pay is free and allows individuals to securely pay their tax bills or make quarterly estimated tax payments online directly from checking or savings accounts without any fees or pre-registration.

Taxpayers can also pay by debit or credit card. While the IRS does not charge a fee for this service, the payment processer does. Other payment options include the Electronic Federal Tax Payment System (enrollment is required) and electronic funds withdrawal which is available when e-filing. Taxpayers can also pay what they owe using the IRS2Go mobile app. Those choosing to pay by check or money order should make the payment out to the “United States Treasury.”

Eligible taxpayers can set up an online payment agreement in a matter of minutes to pay tax, interest and penalties they may owe. There is no application fee to setup payment plans lasting 120 days or less. In 2019, over 1 million agreements were set up by taxpayers online.

Individual taxpayers can go to IRS.gov/account and login to view their balance, payment history, pay their taxes and access tax records through Get Transcript. Before setting up an account, taxpayers should review Secure Access: How to Register for Certain Online Self-Help Tools to make sure they have the information needed to verify their identities.

 
Need an IRS Payment Plan
for 60 or 72 Months?
 


 
Contact the Tax Lawyers at 
Marini& Associates, P.A. 
 
 
for a FREE Tax HELP Contact Us at:
www.TaxAid.com or www.OVDPLaw.com 
orToll Free at 888-8TaxAid (888) 882-9243

Read more at: Tax Times blog

PI Attorney Misinterpreted his Tax Law Courses in College

October 15, 2019

According to DoJ, a grand jury in Detroit, Michigan, returned an indictment on October 10, 2019, charging Carl L. Collins III, a Michigan attorney, with tax evasion, filing two false tax returns and seven counts of willfully failing to file individual and corporate tax returns.

According to the indictment, Collins was a personal injury attorney with offices in Southfield, Michigan. Collins also allegedly owned two medical companies, MedCity Rehabilitation Services LLC and Alpha Living LLC, as well as a real estate company called First Third LLC.

The indictment charges that Collins filed a tax return for 2012 with the Internal Revenue Service (IRS), which failed to report approximately $550,000 in income.

Collins allegedly deposited most of this unreported income into an attorney trust account, which he failed to disclose to the Michigan State Bar Foundation and his tax return preparer.

  • The indictment further alleges that Collins evaded personal income taxes for 2015 by depositing approximately $580,000 of income into his undisclosed attorney trust account and using much of the money to purchase real estate.
  • The indictment also charges that, in 2017, Collins filed a false delinquent tax return for 2015.
  • The indictment further alleges that Collins willfully failed to timely file tax returns for several years for both himself and his corporations.

Specifically, Collins failed to timely file his individual tax returns for 2013 through 2015, corporate income tax returns for Alpha Living LLC for 2013 through 2015, and corporate income tax returns for MedCity Rehabilitation Services LLC for 2013.

If convicted, Collins faces a maximum sentence of five (5) years in prison for the tax evasion count, three (3) years for each of the false return counts (6 yrs), and one (1 ) year for each of the failure to file counts (7yrs).

Collins Faces Collectively a Maximum Sentence
Totaling 18 years of Jail Time!

 

 

He also faces a period of supervised release, restitution, and monetary penalties.

And all This for What,
Not Paying His Fair Share of Taxes
After Deductions?
 
 

This Is Especially Sad Since He Is An Attorney and He Could've Used An Annuity To Defer His Taxes On His PI Fee's

 

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

 

  Have an IRS Criminal Tax Problem? 


  
Contact the Tax Lawyers at 
Marini& Associates, P.A. 
 
 
for a FREE Tax HELP Contact Us at:
www.TaxAid.com or www.OVDPLaw.com 
orToll Free at 888-8TaxAid (888) 882-9243

Read more at: Tax Times blog

Live Help