As we approach April 15th many taxpayers will meet with professional tax advisers and some may be under the impression that communications between a taxpayer and a tax adviser are privileged. This assumption is wrong as demonstrated by a case now on appeal from the Ninth Circuit to the U.S. Supreme Court (Edwards v. The [...]
Is the Tax Adviser Privilege a Trap fo the Unwary?
February 19th, 2012Innocent Spouse Relief has Been Made Easier
February 12th, 2012In Notice 2012-8 the IRS has improved the possibility of “Innocent Spouse” claims for relief from tax liability being granted. The new factors that the IRS will take into consideration are actual abuse or lack of financial control. The actual abuse in the form of physical intimidation is best proven through police reports of domestic [...]
To DIsclose Or Not-Foreign Asset Issues
February 12th, 2012The IRS recently extended the Offshore Voluntary Disclosure Initiative (OVDI)only this time without a deadline. The miscellaneous civil penalty was increase to 27.5% from 25% of the highest single year foreign financial account balance. That cost may have a chilling effect on participation, but it should not for some taxpayers. One of the benefits of [...]
Foreign Assets; What Must I Disclose?
January 29th, 2012Beginning with income tax returns for 2011, U.S. individual taxpayers must attach a statement (Form 8938) to their return if they hold an interest in “specified foreign financial interests” and the value of those interests exceed certain thresholds. Example for an individual the threshold is $50,000 at year end or $75,000 at anytime during the [...]
New Offshore Traps
January 6th, 2012The U.S. uses a global approach to income and estate tax. Many of the other G-20 countries use a territorial system. The result is that U.S.taxpayers, are now faced with enhanced disclosure and enforcement issues. Form 8938 is required for U.S. taxpayers as part of Form 1040 whose aggregate “specified foreign financial assets” exceed specified [...]
Focus of Internet Poker Settlement: ENFORCEMENT
December 17th, 2011Recent reports are that a deal has been agreed to by all interested parties which would allow the sale of Fulltilt assets to a French Company (GBT). As reported part of the purchase includes a payment of $80M USD by the buyer to the U.S. Department of Justice (DoJ). The DoJ may then use the [...]