Taxes and Attorneys: March 2018

Monday, March 19, 2018

IRS announces OVDP will end Sept. 28, 2018. What this all means.

http://ift.tt/2G32879 Tax Attorneys Anthony E. Parent & Robert V. Hanson discuss the impending OVDP deadline of Sept. 28, 2018, and what it means for people who are thinking of making a disclosure and the forecast for those who miss this deadline. Citing a huge drop off in Offshore Voluntary Disclosure Program (OVDP) submissions from a high of 18,000 in 2011, to a low of 600 in 2017, the IRS has decided to end the Standard OVDP this September. There is still good news --- the Streamlined and Delinquent Informational Reporting Form (DIRF) programs will remain open. This move comes as little surprise to us. As the years have progressed since the first 2009 Offshore Voluntary Disclosure Initiative (OVDI), we have had more and more Streamlined Disclosure cases and less and less full OVDP submissions. The reasons? The people who are eligible for the Streamlined program continue to grow, whereas, those who intentionally did not file and did not report their worldwide income and assets have likely already made up their minds about whether or not they wish to comply with the IRS. For instance, every day there are new US immigrants, Visa holders and Green Card holders who are never told about their IRS and FinCEN reporting obligations on their income and assets back home -- until after they made a mistake and need the Streamlined program to reduce exposure to what can be devastating penalties if caught in a tax audit. The rules are very complicated which is why we invite you to contact us about your concerns. Many problems are not as big as people's worst fears. A little bit of knowledge can really lighten your emotional load. We help people form around the corner and around the globe. Contact us at: Parent & Parent LLP 144 South Main Street Wallingford, CT 06492 (203) 269-6699 info@irsmedic.com https://youtu.be/WqsCjDSbeto IRS Medic

Monday, March 12, 2018

Tax Audit Red Flags: Separating fact from fiction

Tax audit red flags: separating fact from fiction. It is that time of the year again, when the early tax filing season is upon us and interest not he IRS is at a yearly high. In response, you will see article published claiming to give you the “secret sauce” on how to avoid an IRS tax audit, by warning you of “red flags.” There articles are all fine, I suppose, if this was 2008. However, the IRS has changed drastically since then. In this article, we will discuss what the real audit red flags are, and what is just sort of things are outdated. 2008 marked the high-water mark of IRS examinations. However, since then, the IRS field examiners are dwindling in supply. What this means is that for most people who used to be under threat of an audit, really aren’t. However, a strange by-product is that certain people are in much more likely to be audited. The philosophy of the IRS examinations was to spread the misery around equally. Everyone was subject to audit. But now, there is an entirely new way of thinking about how the IRS actually selects individuals to audit. Old: Ensure compliance all around Now: Where is the highest return on investment (ROI) of auditors’ time. So…what can be done automatically? The highest ROI is usually find where no or few IRS employees are needed. For instance the IRS has an Automated Underreporting Unit. Leaving off income items, like 1099s can result in an automatic adjustment. The IRS send you a notice (usually a CP2000) to let you know they intend on increasing your income tax, they also give you an opportunity to contest. A common area of contesting these assessments is when the IRS doesn’t take into account your basis, or cost of the property you sold. If the IRS get a 1099s for you selling real estate and stock, the IRS may consider all of the proceeds as income. Yet we know this is very unlikely — real estate and stocks cost you something . What aren’t Red Flags. These things used to be Red Flags, but perhaps are now yellow flags. Why, because it actually take an audit to determine if it is worth it to audit you! The IRS would rather now for sure an audit will likely lead to an increase, not could. But likley. Making a lot of money Higher than average deductions Claiming rental losses. Taking large charitable deductions. Hobby losses Deducting meals travel and entertainment. Claiming 100% business use of vehicle Claiming professional trader in order to immediately utilize losses instead of being limited to $3000 per year offset. Not reporting gambling wins. Claiming home office deduction Large cash deposits. Running a business. So what has the maximum ROI per employee hour worked? Very hard to beat foreign returns with foreign income — they can be penalty minefields — and obviously so. An expert on intentional taxation can look at a return and find facial errors that would lead to an automatic $10,000 penalty. It is actually pretty easy ti determine if a Form 5471, Form 8938, Form, 3520-A, Form 3520, or a Form 926 needed to be filed, but wasn’t. It is easy to determine if they are o substantially complete to be counted as being filed. And these five forms — each has a $10,000 penalty that could be assessed easily. For multiple years. So do you see how the IRS would be interesting in auditing an international return of moderate complexity? The problem is that with foreign assets and income. Your options are to: leave it off and face the prospect of huge penalties that could destroy you if detected. Do it yourself and hope for the best. Yet reporting can increase your audit risk. Hire a firm experienced with winning IRS international audits to minimize any a penalty exposure. What if you haven’t been reporting foreign income properly? The good news is that most people qualify for a streamlined disclosure program and this can really eliminate any penalty potential. We have submitted hundreds and not one has been audited as of today. For help contact us today. We help US taxpayers around the globe. Parent & Parent LLP 144 South Main Street Wallingford, CT 06492 (203) 269-6699 Skype: skype@irsmedic.com Email info@irsmedic.com https://youtu.be/Dqi-PG6YvJM IRS Medic

Monday, March 5, 2018

Welcome to IRSMedic! Suscribe now for real tax guidance.

http://ift.tt/1RfwK1f There is nothing in the history of the world as complicated as the US tax code. And every day with new laws, new regulations, new court cases, and new procedures it gets even more complicated. Now —- the other part of this compliance sandwich — that puts you right in the middle — is that the consequences for doing something wrong. Whether intentionally or not, the impact can be devastating. I am tax attorney Anthony Parent of Parent & Parent LLP and that’s why I created the IRSMedic channel. Our content formula is simple we take the complicated code, jargon, and BS, and employ our 20 years of experience to simplify to something understandable to an actual human being, so that you can figure out what kind of action you should take, if any. Whether you are a taxpayer, a fellow tax practitioner, a fellow attorney, or even an IRS employee, my advice: Subscribe to our channel because our videos could really help you get your head and hands around a complicated US tax problem, so that you can avoid a discomfort that others might not have been not able to. Parent & Parent LLP 144 South Main Street Wallingford, CT 06492 (203) 269-6699 info@irsmedic.com http://ift.tt/2D0JRlA https://youtu.be/q30wyP8IoUc IRS Medic

Tax Reform & Subpart F: The good, the bad and what to do about it.

If you are a US person and have a Controlled Foreign Corporation you may be subjected to the dreaded Subpart F rules. While tax reform initially looked promising and helpful, the result is less than desirable. While some income like oil and gas income is no longer subjected to Subpart F, tax reform instituted a hair-trigger test to determine CFC status. And perhaps more consequential, is that tax reform imposed an "excise tax" tax on retained earnings. Meaning if you avoided Subpart F over the years, you may not be able to entirely avoid a 15.5% tax on your built-up foreign income. This new taxing regime is testing our ability to find creative ways to lower our clients' tax bills, while avoiding any of the very severe foreign reporting penalties. Subscribe now so you will learn about these strategies we will be discussing in future episodes. If you are a prospective client contact us at: Parent & Parent LLP 144 South Main Street Wallingford, CT 06492 (203) 269-6699 info@irsmedic.com https://youtu.be/YJ4HaYPofgI IRS Medic

Welcome to the IRSMedic channel

There is nothing in the history of the world as complicated as the US tax code. And every day with new laws, new regulations, new court cases, and new procedures it gets even more complicated. Now —- the other part of this compliance sandwich — that puts you right in the middle — is that the consequences for doing something wrong. Whether intentionally or not, the impact can be devastating. I am tax attorney Anthony Parent of Parent & Parent LLP and that’s why I created the IRSMedic channel. Our content formula is simple we take the complicated code, jargon, and BS, and employ our 20 years of experience to simplify to something understandable to an actual human being, so that you can figure out what kind of action you should take, if any. Whether you are a taxpayer, a fellow tax practitioner, a fellow attorney, or even an IRS employee, my advice: Subscribe to our channel because our videos could really help you get your head and hands around a complicated US tax problem, so that you can avoid a discomfort that others might not have been not able to. Parent & Parent LLP 144 South Main Street Wallingford, CT 06492 (203) 269-6699 info@irsmedic.com http://ift.tt/1RfwK1f https://youtu.be/jdE60o1fOdo IRS Medic