Internet Tax Lawyers

There is currently pending in a Northern California Federal Court a
dispute between college athletes and Electronic Arts, the NCAA, and the
Collegiate Licensing Company a right of publicity suit over the use of a
college athlete’s name and likeness in video games.  Collegiate
athletes are not allowed to receive certain types of benefits for
playing.  However, many states recognize the ability of a person to use
their name and likeness, or more appropriately, to prohibit others from
using their name and likeness.  The right of publicity stems from a
person’s right to privacy.

On the other side of the coin is the venerable First Amendment. 
Oftentimes, the First Amendment is a valuable tool in combating against
claims of theft of intellectual property (trademark, copyright, right of
publicity).  To overcome the First Amendment defense, those seeking to
assert their right to publicity will need to show that their right
trumps the defendants’right to Free Speech.

It seems to me that the way forward for the athletes is to convince the
Court that the use of the likenesses of the athletes is a significant
aspect of defendants’ability to profit from their endeavors.  Of
course, the schools and the NCAA already profit greatly from exploiting
their athletes, but that is a blog for another time.

The case was investigated by special agents of the IRS Criminal Investigation.

On his 2004 tax return, Black claimed gross income of only $319,866, when in reality the gross income amount was over $1 million, causing a tax loss of over $270,000 to the IRS.

Black also took business cash payments and diverted it for his personal obtain. Black failed to deliver all the records of these diversions to his accountant, which would have enabled the accountant to prepare a complete and accurate personal tax return.

According to court records, during the 2004 tax year, Black diverted income from his law firm by using checks made out to him, his wife or other businesses to pay for his personal expenses.

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2. Another IRS Tax Case: Illinois Businessman Charged with Tax Evasion

A lawyer in Port Huron, Mich., was sentenced to 24 months in prison for tax evasion.

David Douglas Black, 49, owner of Black, Black and Black law firm also was sentenced to two years of supervised release and ordered to pay a special assessment of $100.

Tax Help with Claiming Disaster Losses

Preparing for a disaster before it happens means avoiding IRS tax problems in the first place. Photo documenting your property and using electronic recordkeeping to safeguard important documents away from the property, can provide piece of mind and immediate assistance if disaster were to strike.

There are special IRS tax lawprovisions for taxpayers and businesses so they can recover financially from a disaster’s impact by granting additional time to file returns and pay taxes.  Affected taxpayers in a Federal Disaster Area can acquire tax help by claiming disaster-related casualty losses on their federal income tax return either in the tax year the casualty occurred or the immediate preceding tax year.

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• Losses from natural disasters are to be treated like other casualty losses or theft on your income tax. Accidental breakage or losses as a result of normal wear and tear are not deductible.
• You will need to file a claim with your insurance company in a timely manner before attempting to deduct the loss. Filing these claims establishes the worth of the property and damage extent.
• Only property losses not covered by insurance are deductible and qualify for relief on your federal income tax. To take these losses, taxpayers must do the following:
  • Subtract $100 for each casualty event.
  • Subtract ten percent of their adjusted gross income from their total casualty losses for the year.
• Taxpayers must file Form 4684 and itemize deductions, and Schedule A with their tax return.
• If financial records were destroyed in the disaster,IRS help is available by requesting copies of prior year tax returns. Extensions are often granted to people in federally declared disaster areas, both for filing and payment of any taxes due.

IRS Tax Problems Should Be Avoided

The IRS stipulates the following:

The National Oceanic and Atmospheric Administration (NOAA) reported 12 natural disasters in 2011 that each caused more than $1 billion in damages, ranging from Hurricane Irene, to severe wildfires, tornadoes and flooding.  As the victims of these disasters rebuild their lives from utter destruction, this tax season many are receiving IRS tax help.

USA Today’s article Tax Relief Possible for Losses in Natural Disasters reports the good news that taxpayers affected by local events not deemed “federally declared disasters”, could still be eligible to take a casualty deduction for losses exceeding what was already reimbursed by insurance. This means that more people will be able to put their financial lives back together sooner. If you were affected by a natural disaster in 2011, sorting through the sea of paperwork may be one of your biggest challenges. Here are some important points to know:

Seeking tax relief by claiming the loss on an original or amended return for 2010, may yield an earlier refund, possibly helping with immediate financial needs. On the other hand, waiting to claim the loss on a 2011 return, however, could result in a greater tax saving. A tax expert such as a certified tax relief specialist or tax attorney is qualified and should be consulted to make informed decisions if facing this situation.

Stay educated and updated on small business and self-employed tax news by checking out the IRS tax center. Keep yourself out of trouble with the IRS!

Tax help on the site includes:

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• Small business forms publications.
• Tax information on starting operating and closing a business.
• IRS videos for information on small business tax needs.
• Business related news and more.

As we move into tax season it is important to stay up to date and educated on the current regulations and laws surrounding taxes. By staying educated on important tax issues you can help keep yourself out of future IRS tax problems such as back taxes and tax liens.

To help make the tax process easier for small businesses and the self-employed the IRS has created a tax center on their website, full of incredible information to help when filing your business and personal returns. The Small Business and Self-Employed Tax Center – Your Small Business Advantage helps by giving taxpayers a list of links and information to assist them with all of their filing needs.

In cases of innocent taxpayers, there are times when not participating in the voluntary disclosure program could result in lower penalties but also trigger a vigorous audit.

The imposition of penalties on OVDI participants also appears unfair in some instances. One lawyer says that he has a client who unintentionally failed to disclose offshore income which resulted in a tax bill of $4,000. The IRS wanted to smack an additional $550,000 in penalties on this particular client which seems grossly disproportionate to the amount of tax that was outstanding.

National Taxpayer Advocate Nina Olson says that criminal tax evaders are receiving a sweetheart deal from the IRS through its voluntary offshore bank account disclosure initiative. Although those who are intentionally hiding assets can come forward and pay a set penalty to avoid criminal prosecution, the system is often unfair to California taxpayers who unknowingly shielded assets from taxation, Olson says.

The reason why the IRS wants to assess such a large penalty is the fact that the penalty is levied against the taxpayer’s largest bank account or most expensive asset, which means that a small tax bill can turn into a massive penalty headache even if it is unrelated to the large account which the penalty is based off of.

Source: Bloomberg, “IRS Called Easy on Criminal Tax Evaders in Watchdog’s Critique,” Jan. 17, 2012

In our next post we will discuss additional concerns that Nina Olson raised about the administration ofthe OVDI programs.

There are two very common situations in which California residents may be unintentionally shielding assets abroad. The first situation involves dual citizens who may not know that accounts in their second country of citizenship need to be disclosed to the IRS. The second case involves individualswho inherit offshore accounts which turned out to be undisclosed.

Reportedly, the 7th Circuit will rehearen banc arguments on whether a Wisconsin high school violated the First Amendment by holding graduation ceremonies in a church. Source: Courthouse News Service, 11/21/11, By Joe Celentino

InSantana v. Department of Financial Services, Case No. 1D10-2744 (Fla. 1st DCA April 5, 2011), the First District Court of Appeal affirmed the amended final order inSantana v. Department of Financial Services, Case No. 09-0829RX (Division of Administrative Hearings, April 29, 2010), striking as invalid exercises of delegated legislative authority:

The Florida Department of Financial Services Division of Agent and Agency Services filed a Notice of Disposition of Petition for Administration Determination ("Notice") for Rule69B-211.042,"Effect of Law Enforcement Records on Applications for Licensure," on September 9, 2011. 

• Paragraphs 69B-211.042(8)(a) and subparagraph 69B-211.042(17)(c)3., F.A.C.;
• The phrase in the last sentence of paragraph 69B-211.042(9)(a), F.A.C.,"for each additional felony"; and
• The phrase in subsection 69B-211.042(21), F.A.C.,"and are all of equal weight notwithstanding from which paragraph they are drawn."

Amendments made to Section 626.207, F.S. during the 2011 Florida Regular Legislative Session became effective on June 17, 2011.  The statute section supersedes Rule 69B-211.042 where the statute and Rule conflict.

John Berlau and Trey Kovacs of The Wall Street Journal point out that Mitt Romney’s capital gains income was paid with after-tax corporate dollars and, therefore, taxed twice. I don’t expect people on the left to understand this. And even if they do, I don’t expect them to stop their anti-rich, class-warrior, Buffett secretary nonsense. But hope springs eternal. [...]

Read the whole How to Avoid an IRS Audit article on US News and World Report.

No related posts.

Panghat v New York State Div. of Human Rights, 2011 NY Slip Op 08475, Appellate Division, First Department Lijo Panghat, alleging that he had suffered defamation as the result of the New York State Division of Human Rights’ having published…

Scott Hodge of the Tax Foundation has, in rebuttal to President Obama’s State of the Union speech, published two charts that show how radically progressive our current tax system is: We found that federal tax and spending policies are already very progressive and redistributive. As the charts below indicate, the bottom 60 percent of families [...]

The Court cited the unfairness of holding an employee to an agreement the employer could unilaterailly enforce, stating

On January 25, 2012 the 5^thCircuit Court of Appeals published its opinion inCarey v. 24 Hour Fitness(5^thCir. No. 10-20845).  The court held that 24 Hour Fitness’s 2005 Arbitration Agreement is illusory and unenforceable.  Carey, a former 24 Hour Fitness employee, argued that the arbitration agreement was unenforceable because 24 Hour Fitness retained the right to unilaterally amend the agreement.  The Court of Appeal agreed with the employee, holding that the arbitration agreement was illusory.  It therefore denied 24 Hour Fitness’s motion to stay and compel arbitration.

“[t]he fundamental concern driving this line of case law is the unfairness of a situation where two parties enter into an agreement that ostensibly binds them both, but where one party can escape its obligations under the agreement by modifying it. Requiring notice alone does not fully address this concern: if an employer provided for 10-day notice of any change to its arbitration provision, this could still arguably allow it to avoid its promise to arbitrate as to claims that were already in progress, unless there were some provision preventing changes from applying to in-progress disputes.”

The case may have important implications in that 24 Hour Fitness has filed lawsuits across the country seeking to compel arbitration of wage claims brought by hundreds of employees, including claims under the 2005 agreement. To see the opinion, click here. 

Professor James Maule has, once again, lied about who tells tax lies. He lists five myths – he really means lies – which he says the right tells about taxes. In this post I will discuss and hopefully refute the first three of them. Maule’s First Myth The first myth, that “47% of Americans do not [...]

IRS Tax Relief Voluntary Program

The IRS sees its voluntary disclosure programs (that began in 2009) as successful in collecting $4.4 billion dollars thus helping to narrow the $345 billion dollar tax gap. But these programs have also succeeded in creating confusion. Wealthy American citizens who intentionally hid money from the IRS in offshore accounts, asserts Olson, are allowed to pay a set fee and avoid criminal prosecution. But for those who unintentionally failed to report foreign income, the situation is not so simple mainly because they didn’t know it was their obligation to do so.

Olson sees the uncertainty surrounding the IRS agents’ inability to adjust taxpayer penaltiesas a problem. Originally, IRS agents had discretion to lower the penalties in voluntary disclosure cases of unintentional evasion. Unfortunately, after March 2011, authority was significantly reduced. Olson believes this fact alone will make it harder to encourage those not paying U.S. taxes eitherdeliberately or not, to come forward voluntarily to possibly pay more.

An article in Bloomberg entitled IRS Called Easy on Criminal Tax Evaders in Watchdog’s Critique outlines Nina Olson of the National Taxpayer Advocate’s concerns that intentional tax evaders get more IRS help than those who weren’t intending to hide money from the U.S. government. Olson warns that future IRS collection efforts could be jeopardized due to confusion over the treatment of accidental tax evaders.

American citizens around the globe are required to report any income tothe IRS even if they live or work abroad or if the assets are not on US soil – it’s all considered income to the IRS. Those who may have been unaware of this obligation are strongly encouraged to get IRS tax relief by paying the taxes due plus penalties. Taxpayers who opt out of the voluntary program and take their chances at owing less in penalties but this action will likely trigger a scrutinizing IRS examination or criminal prosecution.

While many IRS tax attorneys are keeping a watchful eye to see if IRS agent’s ability to reduce penalties is restored, they encourage taxpayers in this situation to contact a certified tax resolution specialist or tax attorney that specializes in regulations concerning offshore tax settlements to explain what your options are.

Hire an IRS Tax Attorney or Certified Tax Resolution Specialist to Help

The current penalty for a citizen who intentionally fails to disclose assets is capped at $10,000 for each instance. For taxpayers who have significant holdings, that penalty amount is considerably less than what they would have to pay if they signed up for the voluntary disclosure program. For example, in 2009, IRS penalties of unreported foreign assets were 20 percent of their most valuable offshore assets or their largest bank accounts. (The current penalty is 27.5 percent for 2012.) Examples of taxpayers owing about $4,000 in taxes, and assessed $550,000 in penalties, is seen as unfair as it far exceed the offer given to those who knowingly cheat on their taxes.

No Current Cap on IRS Penalties

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If you are self-employed you are able to deduct the costs of running your business. These costs are known as business expenses. To be deductible, a business expense must fall into two categories; ordinary and necessary.

Who is considered self-employed?

If you require further information, the IRS website is a good place to start for basic answers. If more in- depth information is required, you are advised to consult a professional tax advisor to assess your tax needs let you know what your options for IRS tax relief are.

• Net earnings from self-employment (excluding church employee income) were $400 or more.
• You had church employee income of $108.28 or more.

Self-employment can be a liberating experience. You get to make your own rules, work your own hours and say goodbye to the horrors of a demanding boss. With this freedom comes responsibility and handling all your business affairs now solely rests on your shoulders, including paying your own taxes. A recent Ledyard-Patch article entitled Self-Employed? IRS SaysYou Should Read This reminds us that the self-employed are urged to get the best IRS tax help and understand their tax responsibilities in order to avoid any future tax problems from the get-go. The following four questions provide simple, basic information the IRS would like the self-employed to know:

What are estimated tax payments?

If you work for yourself, as an independent contractor, or you carry on a trade or business as a sole proprietor, you are typically considered by the IRS to be self-employed. Generally, your net earnings from self-employment are subject to self employment tax. To avoid IRS tax issues, you must pay self-employment tax and file Schedule SE (Form 1040) if either of the following applies:

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2. Tax Advocate Warns Taxpayers Rights at Risk
3. Offshore Tax Evaders Get Preferred IRS Help

It is typically not allowed to take personal, living or family deductions for a business enterprise. However, if you have an expense for something that is used partly for business and partly for personal purposes, you can divide the total cost between the business and personal parts and take thededuction, but be warned. Too many business deductions can raise red flags and bring on the anguish of an IRS tax audit.

Estimated tax is the method used to pay tax on income that is not subject to withholding.  If you are self-employed, you should be making estimated tax payments quarterly.  This applies even if you also have a full-time or part-time job and your employer withholds taxes from your wages. If you fail to make quarterly payments you could be facing IRS penalties for underpayment at the end of the tax year.

• An ordinarybusiness expense is defined as being common and acceptable for a particular field of business.

• A necessary business expense is one that is helpful and appropriate for your business. An expense does not have to be indispensable to be considered necessary.

What is self-employment tax and what is the rate?

What deductions are allowed forself-employment?

If self-employed, you are obligated to pay self-employment tax as well as income tax. The self-employment tax rate for self-employment income earned in calendar year 2011 is 13.3% (10.4% for Social Security=old-age, survivors, and disability insurance, and 2.9% for Medicare=hospital insurance).

According to court records, Gary Neuger and Beth Neuger stopped paying federal income tax in 1997. When the IRS attempted to collect the outstanding taxes, Gary Neuger sent threatening letters to the IRS and filed several lawsuits against revenue agents. Then, in February 2005, Beth Neuger filed a series of income tax returns stating she made zero income even though she worked as a nurse at a hospital at the time.

Gary Neuger, 56, was sentenced to serve24 months in federal prison, followed by one year of supervised release, along with paying $393,791.20 in restitution to the IRS. Beth Neuger, 54 and Gary’s wife, was sentenced to serve three years of probation, with the first 10 months in home detention.  She was also ordered to pay $31,563.01 in restitution to the IRS.

No related posts.

A Colorado Springs, Colo., couple were sentenced to criminal obstruction and filing false income tax returns.

In April 2005, Gary Neuger filed a series of income tax returns stating he made zero income and owed zero in income taxes while working as a psychologist in a private practice. According to the plea agreement, after being contacted by the IRS in 2009, both Gary Neuger and Beth Neuger admitted to filing false income tax returns.

A Colorado High School transgender student, who was born male but identifies as female, was told that she can only use the staff restrooms at the school, reports the Coloradoan. The student in question, argues she should have the same…

John Kerry, the Democratic nominee for President in 2004, paid a lower rate of taxes than Mitt Romney paid in 2010. Of course, we didn’t hear much about Mr. Kerry’s low tax rate from the mainstream press even though, unlike Romney, he thinks the rich are undertaxed. It almost seems unfair to point out that unlike Mr. Romney, who [...]

Some file-sharing sites drop the sharing

from USA Today

http://www.usatoday.com/tech/news/story/2012-01-23/file-sharing-anti-piracy/52760484/1?loc=interstitialskip

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