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STRATEGIC TAX LAWYERS:  TAX BLOG

The Latest from the IRS

Monday, December 7, 2015
The IRS has just released its 2015 Annual Report. The annual report includes recommendations on a variety of tax administration issues.  The advisory group to the IRS, known as IRSAC, oversees the process and provides a forum for the IRS Commissioner, as well as IRS executives and public representatives to review and discuss the most pressing tax administration issues based on the annual report.

The IRSAC is made up of volunteer who provide their personal feedback and suggestions about tax issues that may be a priority for taxpayers. They really become the spokesperson for taxpayers. IRS Advisory Council members represent the taxpayer’s ideas of standards and practices that are necessary for IRS-related activities and for tax professionals. They provide constructive and valuable feedback about IRS policies, programs, and procedures, both new and existing as well. .

This year, IRSAC provided different recommendations to the IRS about many different issues that the taxpayers may be concerned about.  Some of most pressing topics that were discussed at the public forum include:

1.     The IRS does not have the funding it needs in order to function in an effective and efficient manner.  This compromises the guidance and assistance that is available to taxpayers, which many times, is not adequate. Funding for enforcement of the tax code is also lacking which minimizes the integrity of the U.S. tax system.

2.     The IRSAC is concerned about the identity authentication system of certain tax forms, specifically the Tax Form 1040 series.

3.     The IRSAC is concerned about the third-party payer arrangements for employment-related taxes.

The IRSAC also showed concern about regulation of tax practice and penalties related to international information related to taxes. The annual report provides information compiled by the IRS for taxpayers and the public at large to be informed about what the IRS is focusing its efforts and resources on.

The report had identified that the IRS faces reduced funding levels in the last three years which caused a decrease in the number of IRS staff who are available to provide necessary services to taxpayers. However, as the resources are depleted, the IRS’s responsibilities have expanded. The good news is that the total amount of tax money has increased. The tax return filings is steady at this time.

The Strategic Tax Lawyers, LLP are a firm of California Tax Attorneys and we are also Intent to Levy attorney and Tax Relief attorneys who specialize in all aspects of the tax code, especially federal tax liens.  Our firm has years of experience dealing with the IRS about tax-related issues.  To get a free consultation, call the Strategic Tax Lawyers at (800) 669-4775 for assistance you with your tax-related matters.



The IRS to be Trained on Bitcoin Currency

Monday, December 7, 2015

What is Bitcoin? Have you heard of the new, innovative virtual currency that has been created in the digital world? The interesting thing about this new electronic currency is that nobody, no individual, no government, controls it.  There is no actual physical money that represents Bitcoin either. Instead, Bitcoin is produced by the public and you can’t exchange it at a bank, you can’t pull it out of an ATM machine. What makes this a fascinating currency is that people and businesses are increasingly using this to purchase goods and services.

We are the Strategic Tax Lawyers and we wanted to let you know more about what the U.S. Treasury defines as a decentralized currency.  As such, the Internal Revenue Service (IRS) needs to be aware of Bitcoin and its technology, so training programs have been developed for tax examiners. The IRS is concerned about what this new currency means for tax purposes.  The IRS has developed an all-encompassing training program for IRS staff and tax examiners with other agencies supporting and contributing to assist with IRS learning about the virtual currency space. The Financial Crimes Enforcement Network (FinCEN) of the Department of Treasury usually works to fight tax crimes such as money laundering.  Now the focus is working closely with Internal Revenue Service to provide the latest and most advanced information for federal tax examiners.

As part of the educational development and training, these organizations will continue to examine digital currencies to determine if the currency exchangers and administrators are compliant with all the rules.  In the past, FinCEN's has provided tax enforcement and protection, but its current role to prevent violation of federal law is not as clear.  If FinCEN identifies serious problems, they will use their enforcement authority in order to penalize those who are not following the standards and are being non-compliant.

The Strategic Tax Lawyers, LLP are a firm of an IRS Bank Levy Attorney, a Payroll Tax Lawyer, and an IRS bank levy attorney.  We, at the Strategic Tax Lawyers Firm, are experts in tax code with years of experience dealing with the IRS.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.



Offshore Programs Produce Billions for the IRS

Monday, December 7, 2015
A new release from the IRS announces the latest efforts to combat offshore tax havens with new offshore compliance programs. These programs have generated the IRS approximately$8 billion.  Over 54,000 taxpayers are subject to paying taxes on income earned offshore.  For over 20 years, the IRS disclosure requirements force taxpayers to disclose their foreign assets, including investments, accounts, property, etc. The IRS is serious about non-compliant offshore bank accounts, so any taxpayers are urged to comply with all their tax obligations. More than half of the 54,000 taxpayers have complied with the IRS’ procedures.  The remaining 20,000 taxpayers participated after June 2014 when procedures were more lenient.

 

Due to taxpayers proactively providing information about offshore accounts to the IRS, the IRS conducted thousands of foreign audits which brought the federal government tens of millions of dollars. In addition, the IRS has followed up with criminal charges that equal billions of dollars in penalties.   The IRS has done all this during an IRS budget reduction.

 

For taxpayers that did not comply, there are two procedures for them to fix their noncompliance with the IRS. These programs are the Offshore Voluntary Disclosure Program (OVDP) and the Streamlined Filing Compliance Procedures.  A taxpayer will not face increased penalties if they disclose their foreign financial institution. The increased fee that taxpayers can face has increased the disclosing of foreign financial institutions by non-compliant taxpayers.  Also, taxpayers who are non-compliant can follow the delinquent FBAR procedure.

 

It is recommended that U.S. taxpayers with undisclosed foreign accounts need to assess their options carefully. The hope is that they will fully comply with the IRS and with their tax obligations. With all the global governing financial entities, it has become much more difficult to keep offshore accounts hidden from the IRS.  The IRS is searching for information from financial institutions around the globe in order to uncover non-compliant U.S. taxpayers. These taxpayers will face criminal prosecution by the federal court system.

 

If you were challenged by the IRS this year and need a good tax attorney, then we are here to assist you.  We are the Strategic Tax Lawyers and we are IRS tax attorneys and experts in the tax code. We have years of experience working with the IRS and negotiating deals for our clients. The Strategic Tax Lawyers, LLP are a firm of taxation attorneys, Intent to Levy attorneys, Fresh Start attorneys and experts in Offer in Compromise.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.

 



Is the IRS Resorting to Private Debt Collection?

Monday, November 30, 2015
We are the Strategic Tax Lawyers, a firm of California tax lawyers. We want to inform you about the Internal Revenue Service possibly using private debt collectors to collect long standing debts from taxpayers.  Congress is proposing to use these debt collectors from collection agencies who will be contracted by the IRS to recover back taxes. Politicians believe this is a surefire way to raise money to pay for projects such as costly highway construction.  However, the opponents of this believe debt collection would lead to abusing the system which, when tried in the past, did not work and was a headache and expensive.

Highway and road building projects are often funded by certain taxes, but due to inflation and other circumstances, there has been a loss in revenue.  To remedy the situation, Congress is stepping in to collect on unpaid income taxes which they estimate is approximately $5 billion in unpaid taxes.  Their solution is to hire private debt collectors to go after taxpayers.  Critics believe that the estimates are exaggerated and the amount that would actually be collected is nearly half, $2.5 billion. That is still an overstated estimate because a lot of debt is owed by low-income taxpayers who cannot pay off their debt in the first place. Add to that the high fees that the collection agencies would which would eat into the tax profit. When the IRS tried to recover tax debts a decade ago using private debt collectors led to the agency losing money on the effort. Taxpayers also complained about getting harassing calls from the debt collectors. In general tax collectors have a bad reputation when dealing with taxpayers. For instance, they do not have the proper tools to negotiate payment schedules or to waive any late payment penalties.
If the IRS will choose to use collection agencies, they will thoroughly investigate them to make sure they are using professional, legitimate debt collectors.  There are many opponents who will fight Congress from bringing debt collection agencies out of the House and Senate bills and out of the taxpayer’s hair.

The Strategic Tax Lawyers, LLP are a firm of California Tax Attorneys, IRS lawyers, and IRS Fresh Start lawyers.  We, at the Strategic Tax Lawyers Firm, are experts in tax code with years of experience dealing with the IRS.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.


No Taxes, No Passport

Tuesday, November 24, 2015

The new year is usually full of travel as people are starting to make plans for business and for leisure. What Congress is ready to enact at the start of this new year may actually pose a challenge to many people who are going to travel, especially for Americans who have not paid their taxes. A new law starting in 2016 may have the U.S. State Department denying passports to U.S. taxpayers who owe the IRS taxes, as well as revoking the existing passports of U.S. taxpayers who have a tax debt. The new rule is part of H.R.22, a highway funding bill.  Basically, if you don’t pay your taxes, you will have no choice but to stay put since you’re not going to be going anywhere. 

Tax experts estimate that this new law could save the federal government nearly $400 million over the next ten years. Next month, Congress will enact this new law which will give the federal government the ability to rescind the passports of Americans who have a tax debt and have not made plans to settle it.  With this new law, the U.S. State Department will be able to deny new passports to those who have tax delinquencies.

The taxpayers most affected will be those with tax delinquencies equaling $50,000 or more, and will include interest charges and related penalties. If a U.S. citizen needs to travel for a certain humanitarian cause, that will be an exception if they happen to have tax debt.  However, if a U.S. taxpayer is on a current IRS payment plan or has a pending tax case pending in tax court, then this humanitarian rule will not apply to them. 

There are many people and affinity groups who are against this new law.  Those most upset about this proposed regulation are U.S. citizens who reside in foreign countries and may not receive the IRS’s mail in a timely manner. There have been many instances when Americans living abroad did not receive correspondence from the IRS, which caused issues with their tax status.  Americans living outside the U.S., rely on their passports for everything, thus leaving them without a passport could be a very big mess. 

Do you have tax debt that you owe the IRS? Is that tax debt over $50,000? Do you have a tax lien filed against you?  The Strategic Tax Lawyers, LLP are IRS CP-523 Attorneys, BOE Tax Attorneys, and IRS Levy attorneys who specialize in the tax code with years of experience in tax-related and IRS issues. The Strategic Tax Lawyers have over fifteen years of experience successfully helping clients with levies.  If you or anyone you know received a notification from the IRS or if you are at risk of having a tax lien placed against you, contact the Strategic Tax Lawyers at (800) 669-4775 for a free case consultation. 




New from tax attorneys in Los Angeles - Health Coverage Exemptions

Friday, November 20, 2015


As part of the Affordable Care Act’s (ACA) Health Insurance everyone who qualifies for health insurance needs to have it.  This is an individual responsibility for yourself, your spouse and your dependents.  For those who have qualifying health insurance you may report a health coverage exemption or you when you file your taxes you can make a shared responsibility payment.

 

We are the Strategic Tax Lawyers, specialty tax attorneys in Los Angeles who want to advise all taxpayers about your health coverage exemption options. If you received your health care insurance through the ACA Marketplace, then you can determine your eligibility for an exemption based on your health care coverage.  This type of exemption will depend on what coverage you have. You can find a chart of the different exemptions on the IRS website. In general, some exemptions are available from the ACA Marketplace and there are some exemptions that can be claimed when you file your tax return.

 

If you determine that you are eligible for a Marketplace exemption, then you just need to fill out an exemption application that is sent to the ACA Marketplace. Then, if you are granted the exemption you will be mailed a notice that will include a specific Exemption Certificate Number (ECN) that is unique to your identification.  You should always keep this information safe with all your other important tax documents. This ECN will be used when you file your tax return.  We recommend that you apply early in order to receive this notice early on so you have it in time to file your tax return.

If you qualify for a health care exemption that you will claim on your tax return, then there is no need to call the IRS to obtain the exemption in advance. Instead, you will need to do is complete Form 8965. For health coverage exemptions and file it with your tax return.

If you do not have any health care coverage and your income earnings are below what the filing requirement threshold is for your filing status, then you will be exempt. This means that you will not have a shared responsibility payment nor will you need to file a return to claim the coverage exemption. If  you do decide to file a tax return, then you then you will need Form 8965.

 

Please remember that if you have any changes in the size of your family or your job income, it may change in your exemption or tax credits so update your forms accordingly. 

 

The Strategic Tax Lawyers - , LLP are a firm of tax professionals and professional tax tax attorneys based in California .  We, at the Strategic Tax Lawyers Firm, are experts in tax code with decades of successful experience dealing with the IRS and settling tax-related cases for our clients.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.

 



The IRS Combats Tax Evasion with Artificial Intelligence

Friday, November 20, 2015
In the past when the federal government has wanted to catch taxpayers who take advantage of offshore tax shelters, they enlist tax attorneys, accountants, auditors to analyze tax returns that are iffy.  We, the Strategic Tax Lawyers, have years of experience with tax evasion and can offer our clients legal advice to assist with IRS-related issues. Tax experts usually analyze thousands of tax filings to track if any offshore money flows through accounts that seem far-fetched.  These IRS uses the expertise of these professionals since it would take the IRS much longer to unravel any major schemes.

 

Now the IRS is going one step further. They are investing in technology. This time it is with mathematical algorithms. There is new data that has proven that using technology, such as artificial intelligence, to put a stop to tax evasion by individuals, professionals and corporations, both publicly traded and private. This technology can provide the IRS with a better way to examine offshore tax shelters that keeps billions of dollars from the federal government. 

 

These tax experts are using the IRS tax code as a formula to construct an algorithm similar to how a calculator works, but in a much more complex manner. The calculation could help detect a tax shelter that is used by a partnership. Through very intricate code, the analysts could detect combinations of partnerships structures that were red-flagged for tax fraud or tax evasion.

 

This idea is very useful for large corporations which commonly avoid taxes and partake in tax evasion. Since partnerships have different tax rules than individuals and businesses, they are a concern for the IRS.  For example, partnerships are less likely to be audited than corporations and often hide behind hedge funds, real estate, etc.

 

If the IRS incorporates a data analysis approach, they can detect suspicious actions such as fraudulent deductions on a tax return. However, using technology or algorithms will not require pre-existing evidence. It will focus on the creation of a sophisticated tax dodgers by taking advantage of a tax-shelter feature which takes advantage of fake losses, deductions and credits in order to lower tax bills.

 

Strategic Tax Lawyers LLP are experienced IRS tax lawyers, estate planning attorneys and offshore attorneys who have counseled clients about the protection of their assets and offshore tax havens.  These IRS tax lawyers can help you plan how to remove guesswork to prevent any issues.  The Strategic Tax Lawyers offer free and confidential consultations about estate planning, estate tax exemption, will & trusts and tax-related issues. Call today at (800) 669-4775 if you need assistance. (thanks to tzvika diner for his help to prepare this article).



Fresh Start and Offer in Compromise (OIC)

Wednesday, November 18, 2015

The Strategic Tax Lawyers, LLP who are IRS Fresh Start Initiative and Offer in Compromise (OIC) experts assist many of their clients who may be financially burdened or struggling to resolve their tax liability to the IRS. The IRS has programs such as the Offer in Compromise (OIC) offers means for taxpayers with a large tax debt with a way to settle that tax debt.  The OIC process allows for a compromise or way for taxpayers who are unable to meet their debt obligation to work on a payment system for that debt.  Many times, the payback amount is significantly less than what is originally owed to the IRS, which depends on need and financial status. This is a great option for taxpayers who are unable to afford to pay part or their entire tax bill.

 

The Fresh Start Initiative includes OIC and Notices of Federal Tax Liens. There are also certain processes and guidelines to qualify for an OIC.  The amount a taxpayer offers as a compromise needs to be based on a tax records and income which the IRS will assess.  The IRS can accept the offer or deny it if they deem that the taxpayer can afford to pay more than what was offered.  To qualify for an OIC, you can get legal assistance from the Strategic Tax Lawyers. They recommend getting current with tax returns status in order to submit the tax payments.  If the OIC is approved, the taxpayer can request a payment plan option.   Experts recommend visiting the IRS website to see if you qualify for an OIC using the Pre-Qualifier tool to determine eligibility.  Those who want to apply for an OIC will need to pay a fee of $186. The Strategic Tax Lawyers can assist with the process.

 

If you need to go through a mediation process for post-appeals of OIC, the Strategic Tax Lawyers represent you to resolve those tax disputes or unsuccessful negotiations with the IRS.  Mediation is legally available to you if you choose to appeal.  Tax attorneys can assist with mediation if there is an agreement that could be reached with the IRS.  OIC lawyers and experts, such as the Strategic Tax Lawyers do want you to know that the mediation process may not necessarily result in a positive settlement decision.  However, they may still be able to assist you since there are options for payment installation agreements to reduce financial strain.   

 

If you or someone you has a tax debt that needs to be resolved, you may be eligible for an Offer in Compromise. You will want the Strategic Tax Lawyers, LLP who are IRS tax attorney in Los Angeles on your side. The Strategic Tax Lawyers are Offer in Compromise and IRS Fresh Start experts.  Contact the Strategic Tax Lawyers, LLP for a free consultation at (800) 669-4775.

 

 



Volkswagen Group is Under Senate Investigation

Monday, November 16, 2015
The government is investigating the Volkswagen Group of America about their 2009 Volkswagen AG Jetta that offers a clean diesel model. The green car is believed to get 41 miles per gallon on the highway. However, did the car manufacturer make allegations about this vehicle that was misleading? Many think that the information communicated about the vehicles eligibility for the lean-burn technology motor vehicle credit is misleading.

The car manufacturer has sold approximately 11 million Volkswagen Jetta (2009-2015), Audi A3 (2009-2015), VW Passat (2009-2015), VW Golf (2009-2015), and VW Beetle (2009-2015) with the software for flawed and favorable emission tests.  The investigation suggests that the Internal Revenue Service (IRS) may have issued approximately $51 million in tax incentive credits to consumers of the Volkswagen mentioned above, many of which had flawed emission tests. Currently, the Senate wants is investigating further in order to determine whether Volkswagen made any false representation about the tax credit.  The investigation will also assess if the car manufacturer falsely reported information that permitted its certification for federal tax subsidies.  The government issued certifications are used to claim tax incentives as well as another motor vehicle tax credit.

By law, according to the Energy Policy Act of 2005, consumers of hybrid vehicles are entitled to a tax break. This includes all fuel cell vehicles, alternative fuel vehicles, lean-burn diesel technology vehicles.  However, the IRS has to acknowledge if the auto manufacturer’s vehicles qualify in order to qualify for the tax credit.  Volkswagen did make sure to certify a certain number of their vehicles so that they are eligible for the credit, but they are only a certain 2009 Jetta model sedan and sport wagon.  In addition, the tax credit was allowable for a certain amount of years. The auto manufacturer has admitted that they used defeat devices on vehicles from 2009 to 2015 which can skew emission information.

A consumer who purchased a 2009 VW model vehicle could be eligible for a tax credit in the amount of $1,300 for a taxpayer in the 28% tax bracket. That would amount to approximately a $4,600 tax deduction.  This incentive provides savings to the consumer to purchase a VW instead of a different make and model energy efficient vehicle.

The ongoing investigation is trying to assess if taxpayers mistakenly received benefits because of manipulated information from the Volkswagen Group. If the car manufacturer is guilty, then they will face hefty penalties and possible criminal charges.

Do you need to hire a reliable team of tax law professionals, which includes IRS Tax Lawyers, IRS Levy Lawyers, and IRS Fresh Start Lawyers, then contact the Strategic Tax Lawyers Firm.  We are tax lawyers who have years of success in IRS dealings.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.



What is a Tax Lien?

Monday, November 16, 2015
We are the Strategic Tax Lawyers, specialty BOE Tax Attorneys, IRS Levy attorneys and IRS CP-523 Attorneys in the greater Los Angeles area who specialize in tax liens.  What is a tax lien?  Simply put, a tax lien is the action the government takes to legally stake a claim on taxpayer’s income, asset and/or property if they fail or neglect to pay their taxes on time or if they owe money to the IRS.  Most often, the Internal Revenue Service issues tax liens in order to get their payment on taxes that are owed to them.  This can lead to problems for your credit and your tax records.  Tax attorneys take federal tax liens very seriously and our tax attorneys at the Strategic Tax Lawyers can assist you to deflect a tax lien.

A Notice of Federal Tax Lien can be filed even if the IRS has a payment plan with a taxpayer. This is done to assure that the taxpayer will pay the IRS.  A tax lien will cause problems for a taxpayer to obtain any form of credit until the tax debt it is paid off.  Tax attorneys can assist clients eliminate a tax lien as well as appeal the filing of a tax lien or remove the lien from the taxpayer’s credit record.  Taxpayer’s credit scores have been affected up to ten years which makes it difficult to purchase cars, property, or other large items.

The Strategic Tax Lawyers want taxpayers to solve any tax issues to avoid a tax lien.  In circumstances where there are delinquent taxes and there is no attempt made to pay them off, then IRS most likely will issue an intent to levy.  This is a final official notice by the IRS informing the taxpayer that their previous efforts to collect payments were unsuccessful.  Therefore, a tax lien will be filed in order to collect payment.

The tax attorneys at the Strategic Tax Lawyers like to work with clients before the notice becomes a lien. In this circumstance, a taxpayer can escape the negative financial issues that are associated with a lien.  Also, taxpayers working with a tax attorney most likely can reduce the amount owed by up to 50% if they qualify for penalty abatement.  However, if no action is taken, then most likely the IRS will seize the assets.

Do you have a tax lien filed against you?  The Strategic Tax Lawyers, LLP are BOE Tax Attorneys, IRS Levy attorneys and IRS CP-523 Attorneys who specialize in the tax code with years of experience in tax-related and IRS issues. The Strategic Tax Lawyers have over fifteen years of experience successfully helping clients with levies.  If you or anyone you know received a notification from the IRS or if you are at risk of having a tax lien placed against you, contact the Strategic Tax Lawyers at (800) 669-4775 for a free case consultation.