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STRATEGIC TAX LAWYERS:  TAX BLOG

Now is the Time for a Mid-Year Premium Tax Credit Checkup

Friday, August 28, 2015

Do you receive health insurance coverage via the Affordable Care Act’s Health Insurance Marketplace? If so, now is the time to conduct a mid-year tax credit check up.  By doing a credit check up you can take advantage of payments of the any tax credits that could be deposited to your health insurance company directly in to reduce the amount of your monthly premium. For example, if you have any changes in the size of your family or your job income, it could make a positive change in your premium tax credit (meaning you can save some money).  Now if there are any life-changing circumstances in the last few months, you can make the change now during a mid-year checkup. 


We are the Strategic Tax Lawyers.

We are tax professionals and professional tax attorneys in Los Angeles who advise all taxpayers to take the time for a mid-year premium tax credit check up to see if you will need to adjust any premium assistance you are currently receiving.  In doing so, it is best to report any major life changes as soon they occur since you signed up for your health insurance plan.  It is best to report these to the Health Insurance Marketplace.  Some of the changes that will require a notification to the Health Insurance Marketplace include a marriage or divorce; birth of a child or adoption; any change in your residence; wage or salary changes (increase or decrease); new job with health insurance coverage; and/or if your health insurance coverage edibility changes (gain or lose eligibility).


The IRS offers a calculator to estimate how the changes in your circumstances will affect the premium tax credit that you will be able to claim come tax time.  It is important to report these changes as to avoid receiving advance payment of the premium tax credit which may be too high or too low. For example, if you receive too much, you may end up owing extra money to the IRS which results in a smaller tax refund next season. On the other hand, if you don’t receive enough, you could be missing out on premium tax credits that could be used to decrease your monthly premiums.


The Strategic Tax Lawyers, LLP are a firm of tax professionals and professional tax lawyers in Los Angeles.  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.





IRS Working to Improve Required Minimum Distribution Requirements

Friday, August 28, 2015

The IRS is currently working on new procedures aimed at notifying and educating taxpayers about tax code provisions that would require them to take minimum Individual Retirement Arrangements (IRA) distributions when they turn a certain age. In general, individuals can start withdrawing a minimum amount of money from specific IRAs once they are 70½ years old.  If they don’t withdraw funds, then they face a loss of tax revenue.  There have been recommendations for the IRS to change this retirement provision noncompliance.  Congress is also interested in providing individuals with education about IRA provisions and penalties associated. Congress is trying to discard penalties for what they deem are innocent mistakes.


The IRS is being held accountable to provide taxpayers with information to help them comply with provisions for taking required minimum distributions from their IRAs. Currently, the IRS uses a method to educate the public about IRA rules.  The IRS also notifies any taxpayers that are noncompliant with their minimum distribution requirement.  The IRS has received recommendations to take steps to improve this method. These recommendations include 1) taking action to communicate with taxpayers who need to take a distribution by providing them with the distribution rules and 2) changing the process that minimum distribution notices identify noncompliant taxpayers.


Since the IRS is facing staff and budget limitations, the IRS cannot comply with some of these recommendations to make quick changes to their notification process. However, the IRS will try to contact individuals who are 70½ years to increase compliance rates, but this may be difficult due to the decreasing IRS budget.


We are the Strategic Tax Lawyers, LLP and we can assist you with any of your tax-related issues with the IRS.  We are professional business tax lawyers with years of experience in tax-related and IRS issues.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.




Worst IRS Customer Service?

Friday, August 28, 2015

This last tax season is being pegged as the worst tax season with the worst customer service to date. This comes after nearly 8.8 million hang-ups on taxpayers who called the IRS.  Last year, it was reported that 544,000 hang-ups. There were millions of calls this year that went unanswered, resulting in the “courtesy hang-up”. The latest tax season had taxpayers needing assistance with the Affordable Care Act new requirements, identity theft, and other tax-related concerns.


Less than 10% of those who called the IRS for identity theft issues could actually get a hold of an IRS agent to report their case.  Just over 33% of those calling the IRS were able to speak with an IRS agent with an average wait time of 23 minutes.  Just last year, the average hold time was 14 minutes and only 29% of calls went unanswered.  


The complaints about millions of taxpayers not being able to reach the IRS or receiving a timely response is a major concern of the tax agency. In addition, taxpayers had to hire tax attorneys and other tax professionals to get the assistance they were looking for regarding the tax code and tax laws.   


Much of this has to do with staff cuts due to budget demands that the IRS is facing. The IRS budget was reduced by Congress in the amount of $1.2 billion, which is a 17% decrease since 2010.  The IRS also may face additional budget cuts by the House Republicans next year. Basically, if a taxpayer had to deal with a live human at the IRS, the chances of speaking with someone was slim to none. If someone was lucky enough to get through to a live agent, many times the question was out of their scope and could not be answered.  Anything beyond basic tax questions were not answered. 

 

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.




Strategic Tax Lawyers Estate Planning Advice

Friday, August 28, 2015

The Strategic Tax Lawyers is an established firm with estate planning attorneys, as well as will and trust attorneys.  In general, the Strategic Tax Lawyers assist their clients to protect their financial affairs and their assets for the future.  Along with this goes education about the importance of protecting their future assets and protecting their family and loved ones from probate. 


The Strategic Tax Lawyers advise their clients to avoid future uncertainties with well-planned will and trust.   Our estate planning attorneys at the Strategic Tax Lawyer firm help clients put together a plan to help their loved ones protect assets, avoid unnecessary probate stress and save money.  The Strategic Tax Lawyers’ team of  estate planning attorneys and will & trust attorneys have successfully provided estate planning services to thousands of clients throughout the years.  In general, probate will involve a court process to settle a person’s final debts and to officially pass titles to a designated beneficiary. Probate is challenging, expensive and time consuming and the Strategic Tax Lawyers work diligently to avoid probate and also can help you plan for a will and/or trust. 


The Strategic Tax Lawyers have assisted their clients with wills and trust, which include all the assets, savings and other accounts, investments, insurance policies, properties, etc.  They suggest compiling a list of all assets, accounts, investments, etc. (as noted above) to help decide who will inherit those assets, as well as who will handle all your financial affairs.  The Strategic Tax Lawyers will work with you to draft a will to designate who and where to allocate all your assets.  


Many people give a portion of their assets to charities, faith-based institutions, educational institutions, nonprofits, etc. that they support throughout their life.  These gifts that are given at any time during the year can be claimed as a tax deduction on income taxes, but the gifts don’t have to end. Many people put this into their trust and will for gift giving to continue.  The Strategic Tax Lawyers always suggest that you donate to charities or institutions you are familiar with and are qualified with the IRS. In addition, if you donate to a faith-based institution such as a synagogue, church or mosque then you can deduct the gift on your income taxes.  And you can set up a system to continue your charitable contribution. 

 

The Strategic Tax Lawyers will help you keep your assets protected from creditors and lawsuits if you have estate tax exemptions.  You could keep your assets with your family and out of the hands of the IRS.  One of the most important tips is to start planning early to prepare your important financial affairs.  For some the decision is very difficult and confusing.  The team of estate planning attorneys and will & trust attorneys will help clients throughout the process. 


Strategic Tax Lawyers LLP are experienced IRS tax lawyers, estate planning attorneys and will & trust attorneys who have counseled clients about the protection of their assets from creditors.  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.




Detroit Pistons Billionaire Estate

Tuesday, August 25, 2015

The IRS has finally reached an agreement in U.S. Tax Court with the estate and heirs of Bill Davidson, the billionaire former owner of the Detroit Pistons and other sport teams, as well as a leading industry business owner of glass, automotive and building products.  Davidson was a great entrepreneur and philanthropist who supported Jewish and Israeli initiatives.  His estate was estimated to be worth over $1 billion. As owner of the sports team, he was the first to own a private plane for his team. He also financed his own arena and changed the approach to marketing the NBA.

This week, Davidson’s estate won a major victory over the IRS. Originally, the IRS claimed the estate owed approximately $2.8 billion in gift, estate, and generation-skipping taxes.  The IRS claimed that Davidson’s accountants severely undervalued the stock that were placed in his families’ trusts. However, IRS will receive a grand total of over $385 million after the heirs disputed the original amount requested.

On Monday, July 6, 2015, the final decision was made by the U.S. Tax Court after two years of legal battle with the IRS to dispute the amount owed. The breakdown of the IRS payout is as follows: gift taxes total $186 million, estate taxes total $152 million and generation-skipping taxes total $48 million.

The Strategic Tax Lawyers are Estate Planning Attorneys and Will and Trust Attorneys who can help you coordinate a good estate plan to avoid probate and other unnecessary financial stress. The skilled team at the Strategic Tax Lawyers have provided estate planning services for their clients by helping them protect their assets.  Probate can be extremely stressful and time consuming.  The Strategic Tax Lawyers can help you avoid probate by creating a will and/or living trust. It is important to decide who you want to inherit your assets, who you want to make medical decisions for you and who you want handling your financial affairs when you no longer are able to.  This is important for estate planning attorneys to begin to draft a will for you. By having a will and other safeguards in place, you can reduce the amount of estate taxes that your heirs will acquire.  Not only that, once your estate plan is put in place legally, you can have the peace of mind to know that your assets will be properly allocated.  

If you or someone you know needs a qualified IRS tax attorney for wills, trusts or estate planning in Los Angeles, contact the Strategic Tax Lawyers, LLP for a free consultation. The Strategic Tax Lawyers are Estate Planning Attorneys and Will and Trust Attorneys who have years of experience in dealing with the IRS. Call the Strategic Tax Lawyers at (800) 669-4775 today.




Legal Tips about Mortgage Debt Cancellation

Tuesday, August 25, 2015

A mortgage or mortgage loan is used if you purchase real estate to secure the borrower’s property.  Mortgages is a legal way to require owners of the real property to pay off the loan.  Mortgage borrowers can be individuals or businesses. 


We are the Strategic Tax Lawyers, and we are Beverly Hills tax lawyers who specialize in tax relief and the IRS tax code. As tax lawyers in Beverly Hills, we have clients who have multiple real estate assets, so we are providing some legal tax tips about mortgage debt. 


The IRS does have a Mortgage Forgiveness Debt Relief Act and Debt Cancellation to allow taxpayers to exclude income from the cancellation of the debt from their taxable income.  If you have a mortgage loan, you will need to pay all the taxes on the amount of the loan. There is a legal exclusion for homeowners if their mortgage debt was cancelled. If the exclusion applies, then the amount of the debt that was cancelled would not be taxable. Also, if your mortgage loan debt for your primary residence was cancelled then you would not need to include that amount in your income. In this case, the loan should be used to buy, improve, or build onto the primary residence in order to qualify for that exclusion.  Please note that this exclusion will not be applied if the cancellation of the debt is not related directly to the declined value of the primary residence or the financial conditions of the taxpayer. 


You can do a loan modification to exclude the mortgage debt amount from your income. Or, you can exclude the canceled mortgage debt through the Home Affordable Modification Program. In the case of a foreclosure, the exclusion of the mortgage debt cancellation would also apply. If you refinance your mortgage the mortgage debt exclusion will apply if any proceeds are used to buy, improve build upon the primary residence. Use IRS Form 1099-C if your debt was reduced or cancelled by a minimum of $600. 


If you have other types of cancelled debt. Which include rental or vacation homes, business property, car loans, or any credit card debt, then it would not qualify for this special exclusion. You can always visit the IRS website for free and interactive tax tools about taxable mortgage debt.


Are you looking for a Beverly Hills tax lawyers? The Strategic Tax Lawyers, LLP are a firm of tax lawyers in Beverly Hills that are experts in tax code with years of experience dealing with the IRS and tax-related matters.   Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.



Strategic Tax Lawyers are Offer in Compromise Attorneys

Tuesday, August 25, 2015

We are the Strategic Tax Lawyers and we are IRS Fresh Start attorneys and experts in Offer in Compromise.  An OIC is an expansion of the IRS Fresh Start Initiative and is often offered to taxpayers who need to owe money to the IRS.  An OIC helps financially troubled taxpayers by providing a compromise to pay off the debt for less than the full amount owed to the IRS and quicker than usual.  Taxpayers need to follow the guidelines to see if they qualify for an OIC. In order to be eligible for an OIC, one of the requirements for taxpayers is to be up-to-date with their tax returns.  


As part of the process, a taxpayer will need to offer the IRS a reasonable amount to pay off their debt based on their finances.  Afterwards, it is up to the IRS to review the paperwork to determine each case.  The IRS will need to assess taxpayer’s income and the value of any assets to determine what a fair or compromised tax obligation will be. The IRS will use allowable living expenses to assess what the taxpayer’s ability to pay is.  This allows for fairness and consistency to determine what the average costs are for people by geographic areas. 


Then the IRS can either accept or deny the offer.  If the offer is denied, that means that a taxpayer, according to the IRS, should pay more than what was offered.  If an OIC is approved by the IRS, then a taxpayer has options to pay including a payment plan paid each month or a lump sum (20%) up front and the remainder paid in a few more payments. 


OICs allow taxpayers to be able to pay back student loans and to pay back any delinquent taxes.  

Taxpayers are encouraged to use the Offer in Compromise Pre-Qualifier tool on the IRS website to determine if they are eligible.  


At the Strategic Tax Lawyers Firm, our IRS Fresh Start attorneys and experts in Offer in Compromise have worked with clients on OIC.  We advise taxpayers, that if the IRS sends you a notification letter for a tax payment, you should act immediately.  Contact a tax attorney, but don’t just ignore the notice.  We have seen instances where a delay in action causes additional interest charges and/or penalties to your debt.  You have ways to avoid paying the penalties bu paying the amount you owe in full.  If you can’t pay in full, there may be an option for a payment plan. Otherwise, the other consideration is an OIC. 

The Strategic Tax Lawyers, LLP are a firm of IRS Fresh Start attorneys and experts in Offer in Compromise.  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.




Important Taxable Gift Information

Tuesday, August 11, 2015
Summertime is the perfect time to start assessing your tax situation for the following tax season. At this time, you can determine if your charitable gift is taxable.  Basically, if you gifted money or property to anyone, then you may qualify for the federal gift tax. There are rules and guidelines for what qualifies for a taxable gift and many gifts are not subject to the gift tax.

We are the Strategic Tax Lawyers, and we are tax lawyers in California. As tax lawyers in California, we have clients who are very generous and are able to give charitable gifts.  Here are some legal tax tips about gift tax.

The general rule for charitable gift giving is that any gift is a taxable gift.  However, there are always exceptions to this rule. There are gifts that are not considered taxable gifts which include (1) gifts that do not exceed the annual exclusion each year; (2) tuition or medical expenses that are paid directly for someone else; (3) gifts to your spouse who you are lawfully married to; (4) gifts for political organizations; and (4) gifts to charities.  

There are also annual exclusions since most gifts are not subject to the gift tax.  For example, suppose you purchase a gift to your spouse or to a charity, that gift is not subject to the gift tax. However, if you purchase for another person, the gift tax will not apply unless the gift’s value exceeds the annual exclusion for the year.  The annual exclusion is approximately $14,000.   Also the person who receives the gift does not have to pay taxes, such as income tax or gift tax on the value of the gift received.

In general, if you make a gift, it usually will not affect your income tax. The value of gifts cannot be deducted.  The exception is charitable contributions.  In addition, the gift tax can apply when you forgive a debt or make a loan that is interest-free or below the market interest rate.  If you and your spouse split a gift, you can spend up to $28,000 without making it a taxable gift.  Form 709 will need to be filled out and included with your tax return.

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


Important Ways to Improve Fraudulent Tax Returns

Tuesday, August 11, 2015
The IRS is working diligently and quickly to fix and improve the process to detect identity theft and prevent tax return fraud. The only problem is, the IRS is limited with the extent of their ability to stop this problem since they can’t access any third-party information until well after the tax return is filed.  The IRS is working to introduce legislation aimed at accelerating and increasing their access to third-party information that would improve their efforts to detect fraudulent tax returns.

We are the Strategic Tax Lawyers, LLP, Encino Tax Lawyers, with specialized Intent to Levy Lawyers, IRS CP504 Attorneys, and Audit Tax Attorneys. We have years of experience and knowledge related to tax fraud and we want to update you about the efforts the IRS’s ongoing strategies to detect and prevent fraudulent tax returns that result in identity theft.  The IRS takes this matter very seriously and is initiating ways to end this occurrence…or at least make it more difficult for con artists.

After an analysis of 2012’s Tax Year, it was discovered that there were over 787,000 potentially fraudulent tax returns that went undetected.  The IRS processed these fraudulent returns and issued tax refunds to the con artists that totaled over $2 billion.  The data analysis also discovered that many of the tax returns had the same address and/or bank account numbers that were not previously identified by the filtering tool that the IRS operates. In addition, the personal pin number that individuals use to file tax returns have been fraudulently used. The analysis discovered that over 140,000 tax returns in 2012 tax returns were filed using personal pin numbers with similar characteristics as those confirmed by the IRS as tax returns filed by con artists.  This fraudulent activity caused the IRS to pay out nearly $375 million in fraudulent tax refunds.

The IRS has spent extraordinary amount of time analyzing identity theft patterns.  Through this process they have recognized that these patterns are constantly evolving.  Therefore, the IRS will need to adapt its fraud detection and prevention processes. The problem with tax refund fraud that goes undetected results in lowered taxpayer’s confidence in the IRS and the tax system.

It has been recommended that the IRS continue to assess the filters that manage tax returns that have multiple use personal pin numbers, addresses, and bank accounts and to expand these filters to address filing patterns that may indicate cases related to identity theft.

If you are looking for Encino Tax Lawyers, contact the Strategic Tax Lawyers, a firm of Intent to Levy Lawyers, IRS CP504 Attorneys, and Audit Tax Attorneys who have extensive training and experience in IRS-related matters and the IRS tax code.  If you have any legal issues with the IRS related to your taxes, call the Strategic Tax Lawyers today at (800) 669-4775 for a free consultation.  You will get your issue resolved in the most efficient manner possible.



Strategic Tax Lawyers’ Summer Tax Recommendations

Friday, August 7, 2015
Now is the time to start thinking about next year’s tax season. The tax attorneys at the Strategic Tax Lawyer suggest that when preparing to file next year’s federal tax return, summertime is the time to start thinking about it.  For example, the tax attorneys recommend changing the amount of taxes that are withheld from your wages.  They also suggest that taxpayers paying the IRS the amount of taxes you realistically owe by changing the amount of estimated taxes you pay to the IRS.  Many of the following strategies done now before the tax season starts can help you avoid getting too much or too little taxes withheld in advance.

For example, if you are a new hire, you should complete a new W-4 Form and go to the IRS website to use the online calculator to figure out the amount of federal income tax that makes sense for your finances that you want withheld from your paycheck.  Tax professionals suggest trying various calculations to estimate if it is better to have more money withheld from your pay or less, depending on your financial situation. Also, if you are planning to get married, have a child or buy a house, then you can change the amount of taxes you owe by submitting a new W-4 form to your employer.  

If you are a taxpayer that is self-employed or if you collect rent, interest and/or dividends, then you may need to pay an estimated tax, especially if you owe over a thousand dollars.  Use the 1040-ES form located on the IRS website to help you figure out when and how much you will need to pay. This may need to be paid up to four times per year.  

Also, if you have a teenager living with you who has a summer job, they will need to fill out a W-4 Form. Parents can show their children how to withhold taxes from their pay, similar to the steps above. They can also use the IRS withholding calculator tool on the IRS website.  Even if your teen is working for others babysitting or mowing lawns, they are considered self-employed.  The money that they earn is taxable. The Strategic Tax Lawyers suggest teaching your teens to keep good records of all income earned, expenses related to work since deductions will cut the taxes owed, and all bank statements showing any income earned.  If your teen is earning tip, then tip income is taxable. It is important for them to keep a daily log to report their tip income.  If they earn more than $20 in any month, then it needs to be reported. It is expected that yearly tips be reported on tax returns.

If you need to hire a reliable team of Tax Attorneys in Los Angeles, contact the Strategic Tax Lawyers Firm.  We are tax attorneys who have years of success in the tax code and with the IRS.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.