Internet Tax Lawyers

According to the article, Susan Combs, Texas Comptroller of Public Accounts, and Amazon.com are working to resolve the following tax problems:

According to the article, Amazon was given the bill for $269 billion in September 2010 that reflected uncollected taxes for sales from 2005 to 2009. The grounds for the assessed sales tax debt is that the Seattle-based Amazon has a distribution center in Irving, Texas, thereby having a physical presence in the state and therefore obligated to pay sales tax. According to Coombs’ estimates, Texas loses about $600 million a year from untaxed online sales.

• Amazon’s tax bill for $269 million for uncollected sales taxes
• Disagreement over future sales tax collection

As previously stated, as a tax debt resolution expert, I have yet to assist clients with auditing or legal issues regarding e-commerce laws, but it appears the tide is changing. The tax resolution reached by Amazon with the state of Texas over back taxes will most certainly impact the future of e-commerce and it won’t be long before there is an increase in IRS audits for e-commerce businesses due to unpaid sales taxes.  I also predict a surge in lawsuits and a need for IRS tax relief as small businesses attempt to interpret the ever-changing and complex United States tax code.

Related posts:

1. Michael Rozbruch Interviewed in Opportunist Magazine
2. Tax Man Explains IRS on Big Biz Show
3. Talking Tax Resolution with Fox 11 Tony Valdez

• Closing the Irving facility.
• Eliminating 119 jobs due to the facility closure even after proposing in 2011 to add up to 6,000 jobs in the state.
• Ending proposed plans to invest further in Texas including investing up to $300 million over three years.

A tax resolution between the two parties appears to hinge on a request by Amazon for a 4 ½ year exemption from sales tax collection on online sales in Texas in exchange for keeping business in the state.

A recent blog post mentioned an article I wrote entitled “The E-Commerce Conundrum: Taxing Virtual Businesses and Their Investors and the Law”. In that article, I discuss at length the tax issues e-commerce and virtual business face, specifically tax pressures from state governments interested in capturing sales taxes from them. Well, this week the Houston Business Journal featured an article Amazon, Texas comptroller negotiating sales tax deal that demonstrates how quickly the virtual business landscape can change.

After receiving the $269 million assessment, Amazon threatened to divest in Texas by:

This proposed regulation follows a recent IRS loss in United States v. Living Word Christian Center, 103 AFTR 2d 2009-714 (D. Minn. 2009).  The case involved a Minnesota Church in which the District Court held that the IRS director of exempt organizations examinations is not an appropriate high-level Treasury official under I.R.C. § 7611.  The Court concluded that the examinations director did not have the breadth of responsibility of the regional commissioner, the official authorized to approve church tax inquires before the IRS was reorganized in 1998.

Author:  Gary M. Slavett J.D., LL.M., Former IRS Attorney

The proposed regulation provides that the director of the IRS Exempt Organization Division will be that high-level Treasury official charged with the reasonable belief determination and approving church tax inquiries.  The director also would be responsible for signing off on a church tax inquiry when a church ignores routine requests from the IRS and would be the official who provides a written notice to a church that an inquiry has been started, according to the proposed regulations.

Under a recently proposed treasury regulation, the director of the IRS Exempt Organizations Division would be the official responsible for approving tax inquiries of churches.  Internal Revenue Code Section 7611 imposes special limitations on how and when the IRS may conduct civil tax inquiries and examination of churches.  The IRS may only initiate a church tax inquiry if a high-level Treasury official reasonably believes, based on a written statement of facts and circumstances, that the organization: (a) may not qualify for tax-exempt status, or (b) may not be paying taxes on unrelated business or other taxable activity. 

If you have any questions regarding IRS examinations of churches and other exempt organizations please contact an attorney at Holtz, Slavett & Drabkin at 310-550-6200.

Gary M. Slavett, J.D., LL.M., Former IRS Attorney

Ask a Foreclosure Attorney About the Cramdown Option

The bankruptcy cramdown was part of the original language of the Helping Families Save Their Homes Act of 2009 and would have amended the federal bankruptcy law governing a Chapter 13 bankruptcy debtor to allow judges to alter the terms of mortgages on primary residences.

Continue reading “Mortgage Cramdowns May Be An Alternative to Foreclosure “

Igor S. Drabkin, J.D., Former IRS Attorney

Author: Igor S. Drabkin, J.D., Former IRS Attorney.

In order to motivate as many Swiss account holders as possible to voluntarily disclose their information, the IRS will not disclose the names of who is on the list of 4,450 accounts, nor will it disclose the criteria for revealing those accounts. We remind everyone that the IRS Voluntary Disclosure Program available to foreign account holders is set to expire on September 23, 2009.  We will issue an update if this deadline is extended by the IRS.

On August 19, 2009, the IRS and UBS AG, one of the major Swiss banks, announced the terms of the settlement reached in a “John Doe” summons enforcement case brought by the U.S. Government to reveal the names of American account holders of UBS Swiss accounts.  Pursuant to the settlement, UBS has agreed to reveal the names and account information of 4,450 U.S. account holders to the IRS.  UBS announced that those account holders whose names will be revealed, will have an opportunity to protest the decision to the Swiss Federal Tax Authority (“SFTA”).  UBS will notify those customers who are on the list that their names are to be turned over to the IRS.   Account owners who content that revealing of their information is in violation of Swiss law will be entitled to a review and decision from the SFTA.  The first 500 UBS Swiss bank accounts will be turned over, according to the agreement, within 60 days of being informed by SFTA tha a formal ask by the IRS was made.  The account holders should be notified by UBS within 15 days of such reqeust.  The last of the 4,450 names to be revealed should be disclosed within a year.

Former IRS Attorneys of Holtz, Slavett & Drabkin are ready to answer your questions and can be reached at (310) 550-6200.

Copyright (c) 2009 Igor S. Drabkin.  All Rights Reserved.

According to the California Highway Patrol (CHP), in 2009, 39 people were killed in motorcycle crashes across San Diego County. The CHP also reports that 989 people were injured in San Diego County motorcycle collisions in 2009.

If a rider survives a crash, the rider can suffer serious, life-altering injuries, such as spinal cord injuries or amputation injuries. Other types of injuries a rider can sustain in a severe San Diego motorcycle accident, include brain injuries, whiplash, back injuries, broken bone injuries, head injuries, joint injuries, burn injuries, and internal organ injuries.

San Diego Motorcycle Accident Statistics

With a skilled and professional San Diego motorcycle accident attorney by your side, you can make sure those responsible for the crash are made to pay for the harm they have caused. A trusted lawyer can also help you gain compensation for medical care costs, lost wages, and pain and suffering. Please contact a San Diego motorcycle accident injury lawyer today. You should not have to pay for the call or the initial consultation. 

Serious Injuries Deserve Serious Results

Although there are far fewer motorcycles than passenger vehicles on San Diego roads, the number of motorcycle accident related injuries is increasing at an alarming rate. In fact, according to the National Highway Traffic Safety Administration (NHTSA), the likelihood of injury is extremely high for riders when involved in a motorcycle accident. The NHTSA found a staggering 98 percent of multi-vehicle motorcycle collisions resulted in some kind of injury to the rider and almost 46 percent of riders injured in crashes suffered more than just a minor injury. Some other notable motorcycle accident statistics from the NHTSAs Hurt Report are:

Collecting Compensation

• Approximately 96 percent of motorcycle riders injured in a crash were male.
• Most motorcycle collisions occurred during a short trip associated with errands, shopping or friends.
• The number one reason for motorcycle accidents was the failure of a passenger vehicle driver to detect a motorcycle in traffic.
• In two-thirds of motorcycle crashes involving another vehicle, the driver of the other vehicle violated the motorcyclist’s right of way.
• Head and chest injuries were the most deadly types of injuries riders sustained in motorcycle collisions. 
• Overall, helmeted riders were less likely to suffer a serious head or neck injury.

San Diego Motorcycle Accident Lawyers: Crash Statistics

If you suffered a serious injury in a motorcycle accident, seek the counsel of a reputable San Diego motorcycle accident lawyer. Many times, a rider is falsely accused of causing a devastating accident, however, a lawyer familiar with motorcycle laws can help prove a rider’s innocence. A lawyer with years of experience handling motorcycle accident cases can also quickly indentify the true cause of the crash.

Ohio Attorney Convicted of Tax Fraud for Failure to Report Foreign Accounts

Paul said that the protocol is too “sweeping” and would threaten protections under the Fourth Amendment to the U.S. Constitution, which guards against unreasonable search and seizure. Paul said he is exercising his privilege to delay a Senate vote.  Paul’s stand could require Democrats who control the Senate to spend a week of floor time before voting to ratify the protocol, which requires assent by two- thirds of the senators.

Rand Paul Seeks to Block Tax Treaty Change on Swiss Accounts

In the statement made by the Assistant Attorney General for the Tax Division, the government said that “those who illegally attempt to hide their income and assets from the IRS through fraudulent trusts or offshore bank accounts will be prosecuted and punished.”   Rick Raven, Acting Chief for the IRS Criminal Investigation said that the IRS will not tolerate abusive tax schemes that use offshore accounts to illegally escape taxes.  Rick Matsa faces a maximum potential sentence of 108 years imprisonment, a fine of up to $3.25 million, and five years of supervised release.

Under the current treaty, the Swiss can grant a U.S. ask seeking data only as it relates to a taxpayer suspected of “tax fraud and the like,” which involves acts such as using false documents or third parties to disguise account ownership. The Swiss won’t hand over data if taxpayers are suspected of tax evasion.  Under the new U.S.-Swiss protocol, Swiss officials would be allowed to hand over account data to the U.S. upon a request  without specifying taxpayers by name.

In another development, Senator Rand Paul is trying to block an amendment to a U.S.-Swiss tax treaty, thus, slowing Switzerland’s handover of data on thousands of Americans with Swiss bank accounts hidden from the IRS.   The protocol, which was negotiated in September 2009, would amend a 1996 treaty and make it more difficult for Switzerland to refuse requests from the IRS for tax information about U.S. customers of Swiss banks.

This case is another example of the government’s efforts to crack down on the offshore tax evasion and enforce FBAR rules.  Although not every case where a foreign bank account was not properly reported bears a high risk of criminal prosecution, those type of situations are very sensitive and taxpayers with undeclared foreign bank accounts are encouraged to consult tax attorneys in order to evaluate their options.

Author: Igor S. Drabkin, J.D., Former IRS Attorney.

Copyright (c) 2012 Igor S. Drabkin.  All Rights Reserved.

According to the indictment  and the evidence at trial, Rick Matsa created and operated several nominee entities in order to disguise and conceal his income and assets from the IRS. The false trust return charges relate to filings for at least five separate trusts during the period of 2003 to 2005.   Each of the trusts reported receiving significant amounts of interest income each year, generated from funds held in numerous bank accounts, yet no income tax was reported due as a result of fraudulently claimed deductions for distributions to purported foreign beneficiaries, whereas Matsa was the true beneficiary of the funds.  The evidence at trial also showed that Matsa violated the foreign bank account reporting requirements by failing to disclose his ownership and control over a foreign bank account held in the Netherlands. The evidence at trial was that Rick Matsa maintained more than $300,000 in funds in that undisclosed foreign bank during 2003.

On April 20, 2012, the U.S. Department of Justice and the Internal Revenue Service announced that an Ohio attorney Aristotle “Rick” R. Matsa  was convicted of tax fraud and obstruction of justice related offenses, including witness tampering, making a false statement, conspiracy to obstruct justice, commit perjury, and make false statements.  The conviction followed a five-week trial in Columbus, Ohio.

Former IRS Trial Attorneys of Holtz, Slavett & Drabkinare available to assist you with the issues related to offshore assets and foreign accounts.  To arrange for a consultations, please contact us at (310) 550-6200.

Many individuals considering filing for Chapter 7 bankruptcy are also struggling to pay their mortgage.  It is common for individuals facing Chapter 7 bankruptcy to also be facing the possibility of foreclosure. The filing of Chapter 7 bankruptcywill not prevent the foreclosure of a home. There are however certain steps that when taken can prevent the foreclosure of a home.

It is important to talk to an attorney regarding your bankruptcy and foreclosure needs. Central Florida attorneys Eric Lanigan and Roddy Lanigan will be able to assist with your bankruptcy and foreclosure. Lanigan and Lanigan are experienced attorneys and provide representation with a personal touch for all your legal needs.

Continue reading “Chapter 7 Bankruptcy and Foreclosure”

To help speed along the process, the IRS keeps the quick e-file option open for many people until October 15. In addition, some taxpayers can take advantage of the IRS’s Free File software, which is a program that can make filing easier. To qualify, taxpayers must have income equal to or less than $57,000.

The IRS imposes financial penalties on taxpayers who fail to file returns and fail to pay required taxes by the stated deadline. These charges continue to mount over time–along with interest–and have the potential to create a substantial tax debt. Ignoring the problem will only make it worse, so the IRS recommends that taxpayers file as quickly as they can and pay as much of their tax bill as they are able. This will help to reduce the penalties and interest.

But not everyone can afford to pay the whole of a tax debt in one fell swoop. Taxpayers whose debt is too great for them to pay off at once do have options, however. The IRS offers installment agreements, which allow a person to pay off a debt over a set period of time. An experienced tax attorney can help negotiate an installment agreement that fits a taxpayer’s individual financial circumstances.

Source: Internal Revenue Service, “Missed the Income Tax Deadline – IRS Offers Help for Taxpayers,” Special Edition Tax Tip 2012-06, April 19, 2012.

The income tax deadline passed a couple of weeks ago, and while many in California filed their returns on time, a few taxpayers likely did not do so. A late filing can cause taxpayers to incur additional costs in penalties and interest, but there are things a person can do to mitigate those expenses. The Internal Revenue Service has released a tax tip touching on that very subject.

Linda (in Pink) Mollie (in Black) March 2012 As many of you know, on June 29, 2012, my 13 year old daughter, Linda, acquired a Kidney transplant from a child donor who died in a tragic accident. We are forever…

Sometimes I bring cases to your attention because they are simply examples of settled areas of law. Matter of Lane v. City of New York, ____A.D.3d___ (2d Dep’t. Feb. 14, 2012), is one such example dealing with a probationary termination….

On August 25, 2009, the IRS updated its FAQs to the Offshore Voluntary Disclosure Program (“VDP”) to include additional information regarding UBS Account holders and their eligibility to participate in the offshore VDP.

Author:  Gary M. Slavett J.D., LL.M., Former IRS Attorney

As part of the agreement with the Switzerland government and UBS announced by the IRS and Department of Justice on August 19, 2009, UBS will be sending notices to account holders indicating that their information may be provided to the IRS under the agreement.  The question is whether this notification by UBS to the account holder will disqualify the account holder from the offshore VDP.  Recently added IRS FAQ 52 provides that if an account holder receives notification from UBS before September 23^rd, this notification will not by itself disqualify the account holder from making a voluntary disclosure under the offshore VDP by the September 23^rd deadline.   The FAQ warns that many of these notices will be not be sent by UBS to account holders until after September 23^rd, and that the September 23^rd offshore VDP deadline applies to all UBS account holders even if they have not acquired a notice by that date.

Gary M. Slavett, J.D., LL.M., Former IRS Attorney

Former IRS Attorneys at Holtz, Slavett & Drabkin are ready to answer your questions and can be contact at (310) 550-6200.

Alcohol related accidents continue to cause serious injuries and fatalities on U.S. roadways. In 2010, approximately 10,000 motorists were killed in drunk driving accidents, some of which took place in Diamond Bar. According to the California Highway Patrol, nearly 5,000 DUI accidents were reported in 2009, causing serious injury and fatalities not only to the drunk drivers but also to individuals who had the misfortune to be passing by a drunk driver.

Particularly in cases involving serious injuries where the liability issues are clear, insurance companies will try to pressure accident victims into settling quickly, usually for far less than they deserve. And while insurance companies will be unlikely to dispute liability claims in a DUI accident, they can challenge the value of your case. To protect your rightful compensation from being undermined, be sure to consult a professional Diamond Bar car accident lawyer before taking any definitive action. An experienced Los Angeles accident attorney can help you assess your case and explain your rights.

Filing for Compensation

• Past and future medical bills
• Lost wages
• Reduced earnings potential
• Pain and suffering
• Physical therapy
• Occupational rehabilitation

In many drunk driving accidents, it is the sober parties who were injured in an unwarranted accident that suffer the most severe injuries. Seeking a just compensation for serious injury claims is significantly more complex than recovering physical property and minor injury damages. Entrusting your case to a professional Diamond Bar DUI accident lawyer is a critical component to recovering the total compensation you are entitled to after suffering serious injuries at the hands of a drunk driver. Legal representation is strongly recommended for victims of injuries such as:

Seek Legal Assistance

It is important for DUI victims to understand that a criminal charge against a drunk driver does not guarantee a full and fair compensation. As with all car accident claims, the injured party must file an injury claim with the drunk driver’s insurance company. This means the potential claimant is still responsible for preparing the proper paperwork, gathering official reports, and collecting witness testimonies corroborating their claim. Because the potential for future damages and health complications are high in cases involving serious injury or fatal accidents, it is important to prove the insurance company’s liability for the maximum compensation possible.

Serious DUI Injuries

• Spinal cord injury
• Traumatic brain injury
• Amputation
• Internal organ injury
• Fractures/multiple broken bones
• Neural damage
• Severe blunt force trauma
• Wrongful death

Your Rights to Compensation

Wrongfully injured parties can seek financial redress from the drunk driver’s insurance company for the damages incurred by the injuries sustained in the drunk driving accident. In many cases, the claimant can typically expect to recover compensation for:

Continue reading “Understanding Your Rights to Financial Compensation After a Diamond Bar DUI Accident”

According to the article, George cited the following 2011 IRS data:

A previous blog post shows just how realistic the appeal of tax scammers can be. Cautionary tale: the IRS holds you responsible for information provided to the IRS and will come after you for payment, no matter what. Prevent IRS tax issues; make sure your tax account is clean.

A Reuters article entitled Tax Refund Schemer Stole 300 Identities reported on the recent prosecution of 12 people accused of a tax refund scheme that stole the identities of 300 people mostly unemployed taxpayers to collect refunds using their information.

IRS deputy commissioner Stephen Miller told the House panel that identity theft progress has been made by giving PIN numbers to the roughly 250,000 taxpayers with prior identity theft cases so they can authenticate their identity to the IRS. This bit of IRS tax relief doesn’t go far to prevent new cases.  Nina Olson, the national taxpayer advocate critical of IRS processes believes tensions exist between the IRS’s goals of processing tax returns quickly and stopping fraud but believes that they will eventually be forced to find a way.

Bloomberg News’ Richard Rubin reported on Russell George, the IRS inspector general and his meeting with a U.S. House of Representatives subcommittee that resulted in his admission of the identity theft issue and how these criminals are filing returns with other people’s identities in order to gain tax refunds…”at alarming rates.” The total amount of identity theft is large and its numbers unknown.

• Protect Personal Information: your social security card, leave in a safe place not your wallet in case it gets stolen.
• Only give out your social security number when absolutely necessary.
• Online: be careful about sharing personal information.
• Shred paper documents and check financial accounts regularly for unusual activity.
• Make sure you file financial documents in a safe location.

An Accounting Today article takes an in depth look into the House hearings and issues such as the IRS’ use of Identity theft filters which were blamed for refund delays this tax season.

The IRS posted an Identity Theft video determined to prevent, detect and resolve identity theft. This video informs taxpayers the need to stay alert for correspondence especially from asking for personal information. IRS slogan: “Your best defense is a good offense.”

Related posts:

1. Tax Fraud Enforcement-IRS Suggests Local Police
2. IRS Warns of “Dirty Dozen” Tax Scams
3. Identity Theft Prevention – Florida Scammers in Prison

• IRS Detected about 940,000 tax returns involving identity theft
• Stopped $6.5 billion in refunds from being issued.

Here are some strategies the IRS suggests:

IRS Reminder: The IRS does not send e-mails out of the blue asking you to share financial or personal information. Taxpayers receiving any such e-mails are to report them to the IRS immediately. Do NOT do the following: Click on any links or respond to that e-mail with any personal information.

Most information dispensed last week was designed to give tax help to last minute filers attempting to complete their tax returns. But news agencies including the IRS are now busy reporting on a new tax story about how rampant IRS identity theft issues are for the Agency itself. Even after the filing deadline, taxpayers are asked to remain vigilant against these tax fraudsters who continue to dupe ordinary citizens. Here are some of the stories in this week’s news.

The video’s advice is common sense based to avoid tax problems, but identity thieves are clever especially online and often approach taxpayers through a realistic looking webpage stating they are from the IRS.

Chicago Teachers Union, Local No. 1 v. Board of Educ. of the City of Chicago, 2012 IL 112566 (Ill. Feb. 17, 2012), is one of those cases which does not make any sense-at least from a practical point of view….

Author: Igor S. Drabkin, J.D., Former IRS Attorney.

Beginning in March of this year, the IRS has been promoting its offshore voluntary disclosure program. Under the terms of this program, the IRS has agreed not to bring criminal prosecutions of owners of foreign bank accounts if they turn themselves in to the IRS Criminal Investigation Division no later than September 23rd. In addition, those who come forward will have penalties limited. Our firm has been assisting many clients with offshore bank accounts, but the time for voluntary disclosure under this program is expiring.  If you have any questions about the program and its terms, please feel free to call Former IRS Attorneys of Holtz, Slavett & Drabkin at 310-550-6200.

Copyright (c) 2009 Igor S. Drabkin.  All Rights Reserved.

Igor S. Drabkin, J.D., Former IRS Attorney

We would like to remind everyone that the IRS Voluntary Disclosure Program for offshore bank accounts and Foreign Bank Account Report (“FBAR”) is going to expire next week, on September 23, 2009.  U.S. taxpayers (individuals and entities) who have foreign financial accounts are required to file Form 90-22.1 with the IRS every June 30th. Those who fail to file an FBAR may be subject to criminal prosecution and jail term of up to 5 years, as well as a criminal fine of $250,000. In addition, a willful failure to file the FBAR can result in a civil penalty of the greater of $100,000 or 50% of the balance in the account. This penalty can be imposed on an annual basis, and can exceed the balance in the account.

Legal Issues of Filing Bankruptcy Before or After Divorce?

A spouse has all the legal rights to get child support and alimony, even if divorce petition is filed after bankruptcy.

In the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, claims of child support and alimony are listed as the topmost priorities. The debts owed and all the unpaid taxes can be repaid later in this regard.

Property settlement in a divorce should be included in the support obligations so that they are not discharged when one of you file for bankruptcy. If you suspect that your ex is resorting to unfair means to get out of the marital debts, then you can refinance all your debts to stay clear from any further financial mess.

Every financial situtation varies and will have to be reviewed carefully. Lanigan and Lanigan will help walk you through the choices and options that will be faced in bankruptcy paired with a divorce.

Now, there are chances that your ex-spouse might contemplate filing bankruptcy. You can request the bankruptcy court, not to discharge your ex-spouse from the non-support obligations and prove that it will have a more adverse effect on you than on your ex-spouse.

Bankruptcy – Its Effect Before a Divorce

As is the law, with every bankruptcy filing, there is an automatic stay on attempts for debt collection by the creditors or collection agencies.

Get a security lien if you owe money from your spouse. Your spouse will have to pay you an amount as security money because of the debts you owe, to get the property in a property settlement. Again, you can put a stay on the discharge of any property by the bankruptcy court with this security lien.

Prior to beginning of the court proceedings, the effects of bankruptcy and divorce should be known.

One of the benefits of joint petition for Chapter 7 bankruptcy is that the community or marital property, i.e., property owned by married couples, is placed under the bankruptcy estate and all the marital debts are washed away.

There will be several factors for you to consider in regards to filing divorce and bankruptcy at the same time but it is best to review all options with an attorney who has experience in both matters. When you come in to meet with Winter Park, Florida, attorney Roddy Lanigan and Eric Lanigan you’ll answer questions and walk through the alternatives available to you in a divorce and a bankruptcy. 

Bankruptcy – Its Effects After Divorce

This legal process clears all doubts as to who is responsible for which debt, thus preventing any future heart burn amongst the newly crowned ex-spouses. The creditors are least bothered with your divorce decree. They will come after any one of the spouses to collect their money.

Usually couples prefer to settle all their debts before divorce is pronounced. Moreover, both  spouses save a lot of money when they file bankruptcy together because it saves them from paying separately for the court formalities, bankruptcy attorney’s fees and so on.

Couples under conditions like these think of filing for both divorce and bankruptcy at the same time. But, these are extremely complicated legal issues that demand a lot of mutual understanding and trust. Many couples get confused as to when is the best time to file bankruptcy? Is it better to file bankruptcy before or after divorce?

As soon as the bankruptcy court receives the bankruptcy petition from the couple, there is an automatic stay order for all the creditors or collection agencies to stop any sort of communication to collect the money owed to them. The divorce agreement comes into effect only when the bankruptcy judge determines all the property exemptions, for example, the current house of residence of either spouse, a part of the sale proceed of the principle car, etc.

After divorce is finalized, put an indemnification clause in the divorce settlement, in this way your spouse will be legally bound to pay the marital debts. This clause will make you eligible to claim for security money when the other spouse goes bankrupt.

Divorce is one of the most painful events in an individual’s life. Usually, financial instability precedes a divorce. As a matter of fact, financial distress is considered one of the biggest causes for divorce. A married couple can divorce each other but they cannot shrug off the debts they have. 

Orlando bankruptcy attorneys Eric Lanigan and Roddy Lanigan don’t practice family law but will consult with families, couples or individuals who are considering or trying to decide when or if to file bankruptcy before or after a divorce.

Continue reading “Legal Issues of Filing Bankruptcy Before or After Divorce”

The IRS just released a video entitled Employee or Independent Contractor? that gives guidance to unsure employers interested in properly classifying their workers as either an employee or independent contractor. Improper classification can result in steep IRS penalties for both employer and worker with many business owners getting into trouble simply because they don’t know the difference. Understanding this distinction can help a business owner avoid an IRS audit.

Application to the VCSP program begins with completing IRS Form 8952, and submitting it to the IRS for approval. Important note: This one-size-fits-all formula for worker classification may not work in all cases for all businesses. Business owners will do well to understand how to make the distinction.

Related posts:

1. Talking Tax Resolution with Fox 11 Tony Valdez
2. Michael Rozbruch Interviewed in Opportunist Magazine
3. Finding Tax Help for IRS Tax Debt

• Have consistently treated workers as contractors or non-employees
• Filed all required 1099 forms
• Employer is not currently under IRS audit or being audited by the U.S. Department of Labor or a state agency regarding the classification of workers.

Below are tax help guidelines to help determine if a worker is an independent contractor.

The IRS video helps to promote the Voluntary Classification Settlement Program (VCSP) that encourages employers to voluntary re-classify their workers from independent contractors to employees. For participating in the program, employers can gain substantial tax relief from past due payroll taxes if an employer begins to designate their workers as employees in the future.

• If the worker owns a business, i.e. DBA or Inc. or LLC, carrying the liability, and is subject to self-employment tax, they are typically classified as an independent contractor.
• Most independent contractors will ask a 1099 form, takes care of their own taxes and will not be eligible for vacation, health insurance, sick-time or unemployment benefits.
• An IRS’ general rule says that an individual is an independent contractor if the business owner has the right to control or direct only the result of the work and not what or how it will be done.
• If you are still unsure, let the IRS decide for you– If you are still unsure, download Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. The IRS will apply the 20-point common law test and make the determination for you. Also, drawing up a written agreement that is signed by both parties will help should there be a question by the IRS in the future.

To qualify for the program, employers must meet the following requirements:

If you find yourself facing IRS debt issues due to incorrect employee classifications, contact a tax attorney and certified tax resolution specialist with experience analyzing business financials so they can negotiate an Installment Agreement or Offer in Compromise settlement with the IRS on your behalf that can help keep the business running.

A business owner who has incorrectly classified workers and fails to file and pay payroll taxes in a timely manner faces some of the toughest IRS collection actions. This includes payroll tax penalties that can double under the Trust Fund Recovery Act as penalties are accessed at 100% of what’s due.

Enjoy this bit of tax humor today!

No related posts.

The National Association of Tax Debt Resolution Companies (NATDRC) is aggressively promoting federal and state legislation to make it illegal for tax debt resolution firms to affiliate with a lead aggregator. It would also prohibit lead aggregators themselves to solicit/market to both tax problem resolution practitioners and the end-consumer.

The Solution

Credible tax problem resolution firms must employ the only three types of individuals in the world who are allowed to represent clients before the IRS. You either must be a CPA, an attorney or an Enrolled Agent in good standing with your respective licensing/governing body. Starting to get the picture?!

Due to the bursting of this country’s financial “bubble,” including the meltdown of big Wall Street firms, the ensuing real estate downturn, record-breaking unemployment, Americans living beyond their means via credit, and the prolonged great recession in general, thousands of so-called credit card debt settlement companies sprung up overnight luring consumers in and promising to settle their (credit card) debts for “pennies on the dollar.” Many of these so-called companies, which were in reality lead aggregators/generators, simply sold consumers’ private, confidential, and personal information behind the consumers’ backs to others who would attempt a settlement/resolution. Many of them simply took the money and ran. These unscrupulous operators lured clients in via large spends on deceptive and, at best, misleading advertising via the internet, radio, and TV.

Due to the overwhelming number of consumer complaints, the Federal Trade Commission (FTC) amended the Telemarketing Sales Rule in August 2010, making it illegal for these firms to accept up-front payments from consumers and prohibiting them from collecting a “fee” until a final, successful completion was reached with the consumers’ credit card companies. This was a much-needed and welcomed “death knell” that put over 80% of these “bad” companies out of business.

However, these companies, not to be undone by the FTC, thought it would be an easy “crossover” into the tax debt relief industry as the targeted end consumer essentially has the same profile and demographic as the credit card debtor. Additionally, many unscrupulous tax debt relief firms, instead of doing their own marketing and controlling the intake criteria, relied on others to get them leads. Since these lead aggregators are not regulated (unlike CPAs, attorneys, or Enrolled Agents) they can get away with making outrageous claims in order to solicit consumers who in reality do not qualify for tax relief in the first place.

At the first official meeting of the National Association of Tax Debt Resolution Companies (NATDRC) in Washington D.C., May 20-21, we will be discussing the regulation of companies utilizing deceptive advertising claims and misleading trade practices that ask unsuspecting consumers (by advertising on the internet, radio, and TV) believing that they are hiring a legitimate tax professional—i.e., an attorney, CPA, or Enrolled Agent—to represent them before the IRS/State. Nothing can be further from the truth.

For the most part, tax debt lead aggregators’ marketing and advertising is deceptive and misleading. Generally, they don’t tell consumers that they are being “referred” or “matched” to one of their affiliate companies. These aggregators do not do the actual case work; the cases are farmed out. Generally, once the consumer releases their personal information, the consumer’s relationship with the aggregator ends. In getting a tax matter resolved, clients would probably have better odds by betting on the craps table in Vegas. The aggregators exist solely to get consumers to respond to their questionable solicitations and then ship them off to another company.

Hundreds of these former disreputable firms are now holding themselves out as “experts” in the tax debt resolution arena. They don’t do the work but “farm” it out, for a handsome fee, to others who will. This and the much publicized demise of the other large nationally marketed firms such as Roni Lynn Deutch (“the Tax Lady”), J.K. Harris, and TaxMasters, have given the credible tax problem resolution firms a huge black eye.

Anyone or any firm offering services concerning tax problem resolution must be the responsible and qualified person to do so. This includes being able to place their own name(s) on IRS Form 2848, Power of Attorney. Only a CPA, attorney, or Enrolled Agent can sign this and be authorized as the taxpayer’s representative. Companies (specifically lead generators) who can’t make this claim should be prohibited from generating and/or aggregating leads to be handed off or sold to others.

Related posts:

1. Michael Rozbruch Interviewed in Opportunist Magazine
2. Taxpayers Must Beware of Tax Relief Firms That Misrepresent Their Ability to Resolve IRS Problems
3. Don’t Miss Tax Help Tips on Bankruptcy From Nation’s Leading Tax Expert Brian Compton on the Big Biz Show-Thursday, March 18th at 1:40pm PST

As with unsecured debt, though (credit card, medical, etc.), anyone can proclaim expertise as long as you have a phone and a persuasive voice. There are no experience, education, licensure or registration requirements. You can do this “work” without having graduated high school. These firms are now trolling for unsuspecting consumers in the tax problem resolution industry.