The Internal Revenue Service (IRS) is serious about holding people accountable for fraudulent activities, which may have been once overlooked or dealt with by a mere ‘slap on the wrist’ , but now those fraudulent acts are being dealt with by prosecuting them. Those prosecutions eventually lead to steep fines and/or imprisonment. Please note that the IRS will prosecute for Failing to Pay Employment Tax; Failing to File a Tax Return; and Failing to Report Foreign Accounts (FBAR), among other frauds. According to the Department of Justice, Tax Division, cases include the following:
Tax Preparation Fraud / False Tax Returns
Tennessee – Two Women Plead Guilty, Ms. Tracey Brown of Total Tax Services of Nashville, TN & Ms.Michelle Theus of Cole Tax Services in La Vergne, TN.
Utah - Mr. Webber, Business Owner – Dealing in Firearms without a license and filing false tax returns.
Maryland – Mr. Cornell M. Jones, Jr.
Florida – Mr. Renel Herard of Herard Tax Services and Herard Security & Training Inc.
Foreign Bank Accounts (FBAR)
Connecticut – Undeclared Bank Account, Mr. Saul Hyatt
Michigan – Concealing Swiss Bank Account, Mr. Bernhard Rumbold
Tax Refund Fraud Scheme
Mr. Lawrence Collins and Icy Love Martin, and Mystique of Portland, OR
Greensboro, North Carolina - Mr. Henti Lucian Baird
St. Louis, MO – Mr. Semere Tsehaye of Instant Tax Service, A&S Tax Service LLC and ERI Enterprise LLC
Failing to File Income Tax Returns
Massachusetts – Mr. Keith Eaton
Failing to Pay Employment Tax
West Virginia – Mr. Michael Taylor & Ms, Jeanette Taylor of Taylor Contracting Y Taylor Ready-Mix LLC
Alabama - Mr. Kenneth Fearson
The list goes on and on and it’s growing. Fraud is not okay. The price for fraud is much higher than the benefit received from committing the fraud. We encourage you to speak to your CPA or Tax Professional to discuss strategies within the confines of the law about how to take advantage of allowable tax credits, deductions, etc. – the right way. It starts with proper recordkeeping, resulting in proper financials, and eventually correctly prepared tax returns.
Please contact us at (786) 715-6781 or email@example.com for a FREE consultation on your business needs. We'd love to help you organize, grow, prepare and file your financial and tax reports timely.
October is Breast Cancer Awareness Month
Firstly, I would like to extend a huge congratulations to all the breast cancer survivors/winners! You are an inspiration to all of us that are still battling this disease. To all the fighters out there, keep fighting! You’re winning!
“According to the World Health Organization, breast cancer is the most common cancer among women worldwide, claiming the lives of hundreds of thousands of women each year and affecting countries at all levels of modernization.” (National Breast Cancer Foundation). Awareness is one combative way we can all do our part and contribute to writing off this disease – permanently from all our lives. Men – you’re not exempt, because men can get breast cancer too.
In recent years, perhaps coinciding with the decline in prescriptive hormone replacement therapy after menopause, we have seen a gradual reduction in female breast cancer incidence rates among women aged 50 and older. Death rates from breast cancer have been declining since about 1990, in part due to better screening and early detection, increased awareness, and continually improving treatment options. (NBCF)
You may be able to write off some or all of your expenses incurred as a result of treating this disease. Other than bore you with the many ways you could have a benefit on your tax return, please remember to keep records or your receipts, payments, prescriptions, and/or any documentation associated with treating this disease – and inform your CPA.
I also want to say ‘Thank You’ to all the associations, foundations, professionals, family-members, and friends that support the cause to create aware and fight breast cancer – Thank You!
You generally can't deduct amounts paid or incurred for lobbying expenses. These include expenses to:
Covered executive branch official. A Covered Executive Branch Official, for the purpose of (4) above, is any of the following officials.
You can deduct certain lobbying expenses if they are Ordinary and Necessary expenses of carrying on your trade or business, such as:
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The 2016 Olympic winners won again! On Friday, October 7, 2016, President Obama signed into law – without ‘official comment’ - a new tax law aimed at benefiting the U.S. Olympic and Paralympic medalists. Essentially, these Olympic medalists will be able to avoid taxes on their medals and winnings. The new tax law or act is officially named the "United States Appreciation for Olympians and Paralympics Act of 2016.” It’s surely worthy of a gold medal.
To all our Olympic winners filing 2016 taxes in the U.S.A., you won again! Congratulations!
Parts of South Carolina, North Carolina, Florida, and Georgia have been declared disaster areas. Accordingly, individuals and businesses affected in those areas may be eligible to receive assistance from the Federal Emergency Management Agency (FEMA). Additionally, affected parties may be eligible for tax relief and deduction in current and future years.
South Carolina - Federal funding is now available to state and eligible tribal and local governments and certain private nonprofit organizations on a cost-sharing basis for emergency work in Beaufort, Berkeley, Charleston, Colleton, Darlington, Dillon, Dorchester, Florence, Georgetown, Horry, Jasper, Marion, and Williamsburg counties.
North Carolina – Federal funding is available for survivors in Beaufort, Bladen, Columbus, Cumberland, Edgecombe, Hoke, Lenoir, Nash, Pitt, and Robeson Counties.
Florida - Federal funding is available to state and eligible local governments and certain private nonprofit organizations on a cost-sharing basis for assistance for emergency work and the repair or replacement of disaster-damaged facilities damaged by Hurricane Matthew in Brevard, Duval, Flagler, Indian River, Nassau, St. Johns, St. Lucie and Volusia counties for debris removal and emergency protective measures, including direct federal assistance, under the Public Assistance program.
Georgia - Federal funding is available to state and eligible local governments and certain private nonprofit organizations on a cost-sharing basis for assistance for emergency work and the repair or replacement of disaster-damaged facilities damaged by Hurricane Matthew in Bryan, Camden, Chatham, Glynn, Liberty, and McIntosh Counties for debris removal and emergency protective measures, including direct federal assistance, under the Public Assistance program.
Getting Assistance from FEMA
Affected individuals, including homeowners, renters, and business owners, in the above designated counties who suffered loss or damages due to Hurricane Matthew may register for assistance online at www.DisasterAssistance.gov, by downloading the FEMA mobile app, or by calling 1-800-621-FEMA (3362). For those who use 711 or Video Relay Service (VRS), the number is also 1-800-621-3362. For people using TTY, the number is 1-800-462-7585.
Type of Assistance
Grant assistance provided by FEMA for homeowners and renters can include funds to help with rent, temporary housing and home repairs to their primary residences, as well as other serious disaster-related needs, such as personal and necessary items, moving and storage expenses, transportation, medical and dental expenses, or funeral and burial and reinternment costs caused by the disaster. Other relief programs include crisis counseling and legal assistance.
The affected individuals or entities may also qualify for postponement of certain deadlines for taxpayers who reside or have a business in the disaster areas. For instance, certain deadlines falling on or after October 4, 2016, and on or before March 15, 2017 have been postponed to March 15, 2017. This includes the January 17, 2017 deadline for making quarterly estimated tax payments and the 2015 individual returns on extension to October 17. Also included are the Oct 31 and Jan 31 deadlines for quarterly payroll and excise tax returns.
The IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after October 4, as long as the deposits were made by October 19th, 2016.
Note - The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 866-562-5227 to request this tax relief.
Got federal tax debt of $50,000 or more? The IRS now has the power to take away your passport, thanks to a transportation bill passed in December.
The IRS law, titled "Revocation or Denial of Passport in Case of Certain Tax Delinquencies," grants the IRS the ability to revoke passport privileges from taxpayers whose tax debt equals $50,000 or more by sending a message to the State Department. The law takes effect this month.
The IRS already works with the Justice Department to regulate US taxpayers who have foreign accounts through the Foreign Account Tax Compliance Act (FATCA), which was passed in 2010. The FATCA bill has routinely been criticized for unfairly extending the powers of the IRS abroad, placing ties with foreign banks where they are not needed.
The State Department already has the right to either refuse to issue or renew passports to people who owe more than $2,500 in child support or certain other debts, like travel expenses related to helping a passport applicant return to the US.
This new law, which comes out of previous iterations that stalled in Congress, is the first to take direct action in attempting to curb the travel of taxpayers who have outstanding tax debt.
“The [Senate Finance] Committee is aware that the amount of unpaid Federal tax debts continues to present a challenge to the IRS,” a report on the bill reads. “The Committee believes that tax compliance will increase if issuance of a passport is linked to payment of one's tax debts.”
In March of 2011, research done by the Government Accountability Office (GAO) explored the possibility of using passport issuance as a means of collecting taxes. GAO found that of the 16 million passports that were issued in 2008, about 224,000 of those individuals owed a little over 5.8 billion in unpaid federal taxes.
While not required to release their tax returns for the prior year, all but one major party nominee since 1976 have done so. (Gerald R. Ford released only a summary.)
So far, neither of the 2016 presidential nominees has adhered to this tradition, though Hillary Clinton has released eight years of returns through 2014. Brian Fallon, a spokesman for her campaign, said that Mrs. Clinton would release her 2015 return “soon.”
Donald J. Trump has cited Internal Revenue Service audits as a reason for not releasing his returns.
The Audit QuestionThe I.R.S. says Mr. Trump is free to release his tax returns despite the audit. There is some precedent: President Richard M. Nixon released his tax returns while he was being audited, though not until after he was re-elected in 1972.
View image on Twitter
Donald J. Trump ✔@realDonaldTrumpSigning my tax return....
1:13 PM - 15 Oct 2015
Joseph J. Thorndike, director of the Tax History Project at the nonpartisan Tax Analysts, says that the complexity of Mr. Trump’s returns is exactly why they should be released. “Unless they are made public, Americans are faced with voting for or against someone whose business interests are almost entirely opaque.”
Why It MattersMr. Trump filed financial disclosure forms in May, which is required of presidential candidates. However, experts say tax returns provide more precise data on sources of income, effective tax rates and charitable donations.
Mitt Romney’s returns revealed that he paid an effective tax rate of 14 percent on his income, which came mostly from investments — far lower than the top 35 percent rate for wages and salaries. He was also criticized for holding money in offshore accounts.
“Releasing your tax returns provides voters with a fuller picture into your background, experience, business interests and insight into potential conflicts of interest,” Karen Hobert Flynn of the public interest group Common Cause wrote in a letter to Mr. Trump urging him to release his returns.
Mr. Trump’s ResponseIt has evolved since he declared his candidacy in June 2015.
Aug. 2, 2015, “Face the Nation”
“We’ll see what I’m going to do with tax returns. I have no major problem with it, but I may tie them to a release of Hillary’s emails.”
Feb. 25, 2016, CNN
“My returns are extremely complex, and I’ll make a determination at the right time.”
May 11, 2016, Associated Press interview
“There’s nothing to learn from them.”
May 12, 2016, “Good Morning America”
“When the audit ends, I’m going to present them. That should be before the election. I hope it’s before the election.”
July 28, 2016, Fox News
“I remember with Mitt Romney four years ago, everybody wanted his, and his is a peanut compared to mine. It’s like a peanut. It’s very small. Not nearly as big a document. I mean, mine, you saw the picture where it’s two or three feet high.”