Posts Tagged ‘Taxdood’

Tax Roundup, June 30, 2013: Faithful execution edition. And getting real in New Jersey.

Tuesday, July 30th, 2013 by Joe Kristan

20130730-2He shall take Care that the Laws be faithfully executed.  Does delaying Obamacare and FATCA requirements run afoul of the President’s constitutional responsibility?  Jeremy Scott at Tax Analysts Blog has some thoughts (my emphasis):

Treasury’s ability to delay the implementation of a law despite a specific statutory effective date is disturbing.  On its face, it seems a clear violation of separation of powers.  If the executive branch disagrees with a law passed by Congress, it can simply delay its effective dates indefinitely.  What if Mitt Romney had won the 2012 election and was president today?  Could he have simply decided to delay ALL of the effective dates for Obamacare, effectively repealing the law without the consent of the Democratic Senate? 

Read the whole thing.

This administration won’t hold power forever.  Its partisans will come to regret the precedents they are creating.

 

Richard Borean, Monday Map: Sales Tax Holidays in 2013 (Tax Policy Blog):

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Iowa’s sales tax holiday for clothing and school supplies starts Friday.  Details here.  Sales tax holidays are, of course, political posturing and bad tax policy.

 

TaxProf, The IRS Scandal, Day 82.

Jason Dinesen, I Ask Again: What’s the Upside of Preparer Regulation for Enrolled Agents?  Jason finds none, and he is correct.

William Perez, Federal Tax Issues for Same-Sex Married Couples

Jack Townsend, Reciprocity — the U.S. Issues John Doe Summonses to Identify Norway Tax Cheats

Brian Mahany, Many Indian Americans Unprepared For FATCA.  Many Americans and green-card holders from India are already unknowingly out of compliance with FBAR and Form 8938 filing requirements.

Kay Bell, Farm bill subsidies feed America’s junk food appetite.  Mmmm, pork.

 

Peter Reilly, Hard For Snow Birds To Avoid New York Tax

 

 It’s Tuesday, so head over to Robert D. Flach’s place for fresh Buzz!  And if you need more, check out his TaxPro Buzz at his other site.

 

Kansas becomes a bad bet for gamblers.  Gambling Loss Deduction Removed from Kansas Tax Code Beginning in 2014 (TaxDood).  Nobody wins all the time.  If you don’t allow losses at least to the extent of winning, you tax imaginary income.  As Kansas has four casinos, tax disaster for many Kansas is just a matter of time.

 

Robert D. Flach, call your office. ‘Real Housewives’ Stars Indicted On Bankruptcy, Fraud And Tax Charges  (TaxGrrrl):

The indictment also alleges that Giuseppe Giudice received income from
his business during the tax years 2004 through 2008 but did not file
federal income tax returns for those years. Giudice reportedly received
income totaling $996,459 during that time. He is charged with five
separate counts of tax evasion as a result. 

I’ve never watched their show,  but I understand they lived an expensive-looking televised life.  If they were committing tax and bankruptcy fraud in front of a national TV audience, that would be unwise.

 

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Tax Roundup, 7/10/13: No tax on foreign losers. And rounding up the tax criminals!

Wednesday, July 10th, 2013 by Joe Kristan

slots.jpgEveryone who is good at math knows that if you play the slots a lot, you will lose.  Sure, you will occasionally get a payoff, but over time the house wins.  That’s why they let you play.

Yet the IRS didn’t let that get in the way of taxing non-resident gamblers.  It says that non-residents have to pay a 30% tax on every winning play, regardliess of the losers.  The Tax Court upheld that position in the case of a Korean gambler, but now the D.C. Circuit Court of Appeals has ruled in the gambler’s favor, allowing him to compute the tax on a “per session” basis, rather than per bet, so that the day’s losses and winnings can be offset.  The court threw the logic of a IRS 2008 technical memo back at the agency:

     The IRS has persuasively interpreted the term “gains” in Section 165(d) to allow U.S. citizens to measure gains on a per-session basis. The IRS stated that “gain or loss may be calculated over a series of separate plays or wagers.” Memorandum AM2008-11, Office of Chief Counsel, Internal Revenue Service 4 (2008) (emphasis added). In the IRS’s words: “We think that the fluctuating wins and losses left in play are not accessions to wealth until the taxpayer redeems her tokens and can definitively calculate” her net gains. Id. Because gain or loss may be calculated over a series of wagers, a “taxpayer who plays the slot machines[] recognizes a wagering gain or loss at the time she redeems her tokens.” Id. Therefore, U.S. citizens do not “treat every play or wager as a taxable event.” Id. The result is that U.S. citizens can measure their gambling winnings and losses on a per-session basis…

     Nothing in the IRS’s Section 165(d) ruling on “gains” turned on the fact that the gamblers were U.S. citizens.

TaxDood has more in Nonresident Gamblers Take a Step Closer to Equality

Cite: Park v. Commissioner, No. 12-1058 (D.C. Ct. App. 2013).

Update: The TaxProf has a roundup.

 

Russ Fox, A Gambler Gambles to Tax Court…and Loses

Trish McIntire, Gambling Rumor.  No, they aren’t disalllowing gambling losses.

 

Lots of tax crime news today.  From New Jersey, we learn that skimming business receipts is not sexy.  A Justice Department press release reports:

A Middlesex County, N.J., man who co-owns  and operates a wholesale merchandise business in New York selling adult  paraphernalia was sentenced today to 19 months in prison for concealing more  than $1.2 million in income in various domestic and foreign bank accounts, New  Jersey U.S. Attorney Paul J. Fishman and Assistant Attorney General Kathryn  Keneally of the Justice Department’s Tax Division announced.

From 2006 through 2009, Gupta diverted $822,916 of the business’  receipts into 17 different personal bank accounts held in the names of various  individuals, including himself and family members. He directed more than  $250,000 of those diverted funds into six different accounts held offshore at a  branch of HSBC in India. From 2007 through 2009, Gupta caused 22 J.S. Marketers  corporate checks to be made payable to
himself and family members in amounts  identical to invoices from the
business’ suppliers. Gupta endorsed those  checks, which totaled $375,138, and deposited them into bank accounts that he  controlled.

17 accounts?  That’s a lot of work that didn’t work out well.

Meanwhile in Oregon, things go badly for a tax protester:  Former Gladstone business owner jailed 97 months for tax evasion, reports the Portland Tribune:

Chester Evans Davis, a 56-year-old Oregon City corporate tax defier, got sentenced to more than eight years in federal prison starting Monday for not filing a corporate tax return five times for his Gladstone business and then trying to obstruct Internal Revenue Service laws.

Davis transferred money from his company to various shell corporations and a warehouse bank, and then used the money to purchase more than $5 million in gold bars and coins. IRS special agents seized over $1 million of that gold, as well as approximately $115,000 in cash, while executing search warrants at Davis’ residence and business.

Again, a lot more effort than filing and paying taxes, and a lot worse result.

Meanwhile in Illinois, the Rockford Register Star reports Tax evading Rockford chiropractor sentenced to prison:

Todd R. Cevene, 42, of Caledonia, was sentenced Tuesday to 10 months in prison by U.S. District Judge Frederick J. Kapala for federal income tax evasion.

Cevene admitted in his plea agreement that during a four-year period between 2004 and 2007, he intentionally evaded payment of his federal income taxes by transferring substantial amounts of Cevene Care Clinic’s income to Cevene Management Group, Todd Cevene Alaska Preservation Trust, and Cevene Enterprises.

There is no magical formula using trusts that makes your taxes go away.

The reeducation of Lauryn Hill.  The singer reported to a federal prison this week to begin serving a three-month sentence on tax charges.

 

Health care taxes: what’s delayed, what isn’t.  My new post at IowaBiz.com, the Des Moines Business Record group blog for entrepreneurs.

Susan Freed, Play or Pay Rules Delayed (Davis Brown Health Care Reform Blog)

 

Joseph Thorndike, House Republicans Would Rather Pander than Fix the IRS (Tax Analsysts Blog):

At the end of the day, they would rather score a few cheap political points than do something to actually fix the IRS.

Yes, the IRS should be adequaately funded.  Yet when the agency proves itself your electoral enemy, you aren’t exactly motivated to fund it.

 

TaxProf, The IRS Scandal, Day 62

William Perez,  Researcher Finds Social Securty Numbers Posted on IRS Public Database

TaxGrrrl, As Second IRS Official Pleads The Fifth, Congress Pushes For ‘Lerner Rule’

 

Jeremy Scott, Summers Pushes for Tax Break on Foreign Profits (Tax Analysts Blog)

Kay Bell, Hurricane season costs tax collectors as well as homeowners

Jason Dinesen, The Oddities of State Taxes — Wisconsin Student Loan Deduction and Nonresident Tax Returns

David Brunori, Taxing Teen Texts and Other Terrible Tax Things (Tax Analysts Blog):

 In addition to fat kids, skinny kids, and kids that climb on rocks, rich kids and poor kids use wireless devices. If everyone is using them, a flat tax is regressive. It is strange that liberal New York and Washington, states purportedly looking out for the little guy, are so enamored with a regressive tax. 

Of course they aren’t looking out for the little guy.  That’s just for the rubes.

Andrew Lundeen, Links: Lap Dance Taxes and Tax Reform Options (Tax Policy Blog).  Lap Dances, marijuana taxes and Warren Buffet, all in one place!

Howard Gleckman, Not All Curbs on Tax Preferences Are Created Equal (TaxVox)

Robert D. Flach,  MY CORRESPONDENCE WITH THE WHITE HOUSE ON TAX REFORM

Brian Maharry, Cell Captive Insurance – Legit Insurance Tool or Abusive Tax Shelter:

The scam promotions typically offer to shelter a large sum of money by calling it an insurance premium. The premium is usually the same dollar amount as the deduction you seek. The promoter offers “insurance” on a highly improbable risk. Hurricane insurance in Nebraska, anyone? Magically, you get a big deduction and in a few years you are promised the ability to get back your money in the form of a “premium refund” or dividend.

It gets windy in Nebraska, especially during football season, but not like that.

 

Oh Noes!  Horror Stories From the CPA Exam: The Prometric Nose Bleed (Going Concern)

 

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Tax Roundup, 7/2/2013: Apologies, newlyweds and civil wars!

Tuesday, July 2nd, 2013 by Joe Kristan
Taxpayer Advocate Nina Olsen

Taxpayer Advocate Nina Olsen

Kay Bell doesn’t much care for the Taxpayer Advocate’s “apology payment” proposal,  where the IRS would pay $1,000 as a token of apology to taxpayers who had gotten the runaround from the agency:

In order to avoid spurring an apology payment, employees could be reluctant to challenge taxpayers in situations where such added attention is warranted. The ensuring refusal by workers to aggressively, but fairly, go after taxpayers will make for a less, not more, effective tax enforcement agency.

So instead of establishing an apology payment system, the $1 million should instead go to the IRS for it to do its job, albeit do it better. That’s also recommended by Olson in her report.

So Kay probably wouldn’t much care for my “sauce for the gander” rule, which would impose penalties on the IRS, payable to the taxpayer, anytime the IRS maintains an unreasonable position on audit.  I would also apply it automatically anytime the IRS asserts an accuracy-related penalty and then loses in court on the underlying issue.

 

Jana Luttenegger, IRS Statement on DOMA and Tax Tips for Newlyweds (Davis Brown Tax Law Blog).

The IRS quietly issued a statement on June 27. Quite, likely because it was of little value to any taxpayers. The statement is available from the IRS Newsroom, and essentially states they are reviewing the recent decision, and will “move swiftly to provide revised guidance in the near future.”

In what may or may not be a coincidence, the IRS Summer Tax Tip released today relates to Tax Tips for Newlyweds.

So maybe the IRS does have a sense of humor.

TaxGrrrl, As Taxpayers Scramble To Make Sense Of DOMA, IRS Issues Statement

 

Russ Fox,  Licensing Stops All Tax Preparer Fraud…Well, No.  But it does make it fraud with a government seal of approval.

 

Howard Gleckman,  New Study: Tax Subsidies Do Little To Reduce Greenhouse Gas Emissions.  But they do help keep stray birds out of foreign airspace.

Missouri Tax Guy, Travel Expenses.  Why these expenses are not like the others.

TaxProf, IRS Scandal, Day 54.

Jack Townsend, Depositor Pleads to Failse Return; Depositor in Luxembourg Branch of Israeli Bank

William Perez, “Blank-Slate” Tax Reform Proposed by Baucus, Hatch

Tax Justice Blog, Top Senate Tax-Writers’ Call for “Blank Slate” Approach to Tax Reform Avoids Most Crucial Issue

Martin Sullivan, Tax Reform: Coming Around the Clubhouse Turn? (Tax Analysts Blog)

Clint Stretch, Tax Reform or Shotgun Wedding? (Tax Analysts Blog)

Tax reform, we are told, will encourage economic growth by reducing complexity, inefficiency, and unfairness.  It probably could, but there are no guarantees.  I have had to read most of the tax legislative histories written in the past 40 years.  I cannot recall any instance in which the committee reports confessed that the wrong balance of fairness, economic growth, and simplification was struck.

Yet it would have been true every time.

 

Kyle Pomerleau, Misleading Corporate Tax Talk: (Tax Policy Blog)

When a company pays employees, either through wages or stock options, they are legitimately allowed to deduct that compensation.

It is not like this money is never taxed. This compensation is taxed as ordinary income at the individual level.

A point often overlooked when they talk about stock option “loopholes.”

 

Janet Novack, GAO: Big Companies Paid A 12.6% Effective Federal Income Tax Rate

Jeremy Scott, Obama’s Climate Change Proposals Lack Major Tax Component (Tax Analysts Blog).  They also lack a snowball’s chance in a high-carbon Hades.

TaxDood, GAO: Bitcoin Presents Tax Compliance Risks

It’s Tuesday, so it’s time for a fresh Buzz from Robert D. Flach. 

 

grant126

Grant at work.

Peter Reilly is taking a few days off from his usual tax topics to cover commemorations of the 150th anniversary of the Battle of Gettysburg, which occurred July 1-3, 1863:Hopes of Our Country Were on Our Bayonets

Gettysburg Day 1 – First Shot – Where Fate Meets History

Gettysburg Day 1 – Passing Into Legend And History With The Iron Brigade

I’m sure there will me more great posts.  But remember that this week is also the 150th anniversary of the fall of Vicksburg to General Grant  — a more spectacular campaign and arguably a more important achievement, but not so well-remembered as Gettysburg.

 

 

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Tax Roundup, 1/4/2013: How many seconds of federal spending do you cover? And more debris from the bottom of the Fiscal Cliff.

Friday, January 4th, 2013 by Joe Kristan

20130104-1Spending, by the numbers.  Local radio guy Brian Gongol asks, Why do we baffle ourselves with huge numbers instead of talking about budgets in per-person terms?  Why, indeed?  You could ask 100 people on the street how much money the government spends and how big the deficit is, and you would be lucky to get the size of the budget within a trillion dollars.  The numbers are hard to comprehend.

The ability of the politicians to get away with talk about “millionaires and billionaires” proves this — a billion is 1,000 million, and while there are likely people on your street with a net worth of $1 million, you probably haven’t met anybody worth $1 billion.  They aren’t remotely the same thing.

In doing year-end tax projections for a client with a once-in-a-lifetime gain from a business sale and a huge resulting tax liability, I wondered how long his enormous (to me) liability would keep the government running.  Dividing the 2012 fiscal year spending of $3.796 trillion by the 31,536,000 seconds in a 365-day year, I figure that the federal blob spends $120,370.37 per second.  The biggest tax liability I’ve ever seen comes well short of funding 2 minutes of government operations.  I probably will never cover a second.  Where do you fit?

 

Fiscal Cliff Webinar!   I will be appearing with Roger McEowen on the “Tax Notes From the Fiscal Cliff” webinar at Noon January 14.  We will be covering the new legislation and the proposed 3.8% “Net Investment Income Tax” regulations.  Register today!

 

The IRS has published new withholding tables for the Fiscal Cliff Legislation (Accounting today)

 

Fiscal Cliff Notes:

Wall Street Journal:  Cliff Fix Hits Small Business; Many Small Entities or Firms May Face Higher Taxes This Year After the Deal

David Henderson, Pssst:  Someone tell the Republicans they won:

So here’s the big news: the anti-tax side won.  Sure, Obama would love
to raise taxes even more, especially on people making between $200K and $450K.  But now he has almost zero leverage to do that. 

I think that’s about right.  And now the President has lost his ability to distract attention from the ongoing fiscal calamity with arm-waving about “millionaires and billionaires.”

Derek Thompson, Sorry, Middle Class: In a Few Years, Your Taxes Will Have to Go Up, Too (via Going Concern).  You know, we could try spending less.  In any case, the rich guy isn’t buying.

Tim Carney: How corporate tax credits got in the ‘cliff’ deal

Katrina Trinko, Hollywood, Electric Scooters Benefit From Tax Breaks in Fiscal Cliff Bill (The Corner)

Brad Plumer, From NASCAR to rum, the 10 weirdest parts of the ‘fiscal cliff’ bill (Wonkblog, via Tyler Cowen).

Chris James, Fiscal Cliff Deal Adjust Capital Gain Rates and Qualified Dividend Rates (Davis Brown Tax Law Blog)

Paul Neiffer, Some More Goodies Buried in the Fine Print

Kay Bell, Redefining ‘wealthy’ for tax purposes

Tax Trials, Fiscal Cliff Legislation – American Taxpayer Relief Act of 2012

Patrick Temple-West, Cliff fix hits small business, and more

Nick Kasprak, 2013 Tax Brackets (Tax Policy Blog)

Roberton Williams, TPC Tax Calculator Shows What Avoiding Fiscal Cliff Means for Taxpayers (TaxV0x)

Howard Gleckman,  What the Fiscal Cliff Deal Really Means for Taxes and Spending

TaxProf,  More Fiscal Cliff Tax Commentary

 

In other news…

Jack Townsend, Wegelin & Co. Pleads Guity to Conspiracy

Lynnley Browning, Swiss bank Wegelin to close after guilty plea.  They opened in 1741.

Jason Dinesen, Tax Predictions for 2013

Trish McIntire, Disclosing Prisoner Returns

Taxdood, Intrastate iGaming: Federal Reporting and Withholding Tax Obligations

Robert D. Flach, WTF IS THIS AMT EVERYONE IS TALKING ABOUT?

News you can use: “Have Fun and Don’t Be Bored” (Brian Strahle)

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Tax Roundup, 10/30/2012: Scary stories for Beggar’s Night. Also: Sandy tax tips.

Tuesday, October 30th, 2012 by Joe Kristan

IMG_1414.JPG

Des Moines has an odd “Beggars’ night” tradition of having “trick-or-treats” on the night before Halloween.  That means it’s not too early for a spooky story.

Once upon a time, a man ran a payroll service in Ohio.  Employers sent their money to the man thinking he was paying their payroll taxes.   The man instead kept the money.  From ToledoBlade.com:

Robert Sacco, the former PaySource owner accused of bilking the IRS of $26.7 million, pleaded guilty to federal felony charges before his trial was scheduled to start Monday.

Sacco pleaded guilty to conspiracy to defraud the United States by impeding the Internal Revenue Service, money laundering, and tax evasion. “This is one of the highest amounts of employment tax fraud we’ve ever seen,” said Craig Casserly, spokesman for IRS office in Columbus.

Sacco defrauded the IRS by withholding money from employees’ paychecks for taxes, then keeping the money instead of paying it to the IRS, according to Carter Stewart, U.S. Attorney for the Southern District of Ohio.

Why didn’t the employers use EFTPS, the Electronic Federal Tax Payment System, to monitor their payments on line?  The man made sure they couldn’t:

Dayton-based PaySource employed 40 people. It was a co-employment company — meaning that it hired a client company’s employees, thus becoming their employer of record for tax and insurance purposes.

So the payments weren’t made under the real employers’ tax numbers, and there was no way for them to monitor it using EFTPS.

The moral?  There are legitimate co-employment companies that have plenty of satisfied customers.  The problem is that the format is also handy for thieves because it makes monitoring very difficult.  If you are considering outsourcing to a co-employment payroll provider, it’s extremely important to do careful due diligence, and to re-do it regularly.  Without EFTPS, you can’t directly verify their performance, so you have to use other ways to assure compliance.  If your payroll provider doesn’t remit your taxes, the IRS will still expect you to pay them.

 

Brutal Assault on Reason Watch: 

Howard Gleckman,  What is Mitt Romney’s Tax Plan? (TaxVox)

Patrick Temple-West,  Essential reading: Washington Post reports Obama administration looking at new tax cut, and more (Tax Break)

Kay Bell,  Who’s the scarier Halloween costume, Barack Obama or Mitt Romney?

Linda Beale,  Romney’s CRUT Tax Shelter

 

Russ Fox,  New York Extends Tax Deadlines Because of Sandy; Expect the IRS, New Jersey, Pennsylvania and Others to Follow

William Perez,  New York Provides Tax Relief for Hurricane Sandy

Peter Reilly,  Hurricane Sandy Tax Planning

Richard Morrison,   Chart of the Day: The Increasing Burden on Older Taxpayers (Tax Policy Blog)

Missouri Tax Guy:  Small Business Health Care Tax Credit, Do you Qualify?

Brian Strahle,  Companies Operating in D.C. Should ACT NOW!!

Jack Townsend,  Render Unto Caesar and the Offshore Initiative

Robert D. Flach offers THE WANDERING TAX PRO’S TOP TEN LIST

Paul Neiffer,  What the Fiscal Cliff Means To You?

Jana Luttenegger, 2013 Inflation Adjustments (Davis Brown Tax Law Blog)

TaxDood,  Lance Armstrong’s Race for Deductibility.  No doping allowed.

In case you were worried:  One Reason The NFL Will Never Permanently Relocate A Team To London: The U.K.’s Tax Treatment of Nonresident Athletes (Anthony Nitti)

 

 

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Tax Roundup, 8/20/2012: Meet the criminal masterminds that outwit Doug Shulman’s IRS.

Monday, August 20th, 2012 by Joe Kristan

Doug Shulman, protecting the taxpayer

You are sending $5.2 billion annually to identity thieves, courtesy of Douglas Shulman’s IRS.  What sort of criminal masterminds are outwitting IRS internal controls to pick your pockets?  Tampabay.com tells the story of one modern-day Professor Moriarty:

More than 10,000 people remain on a waiting list for federally subsidized housing in Hills­borough County.

Not LaSandra Gamble, 27-year-old mother of five.

Last summer, between housing, utilities and food stamps, she drew benefits of $2,363 a month, Tampa Housing Authority files show.

Yet, in August 2011, she put down $9,000 on a black 2006 Lexus GS430, police said. Three days later, they said, she put down another $9,000, this time on a red 2007 Lexus ES 350. Combined, the monthly payments were nearly $2,000.

Gamble, in an interview, said police have it wrong. She said she got the cars because she was involved with the car dealer.

“I didn’t have to put nothing down,” she said. “We were in a relationship.”

Legally, she was in a relationship with her husband, 33-year-old Angelo Juan Pedrosa, whom she had married a year earlier.

Police got involved Oct. 8, when they stopped Pedrosa driving the black Lexus. Pedrosa is a convicted cocaine dealer. Along with marijuana residue, the officers reported finding $6,000 and a dozen debit cards in other people’s names.

Reloadable debit cards, sold online, carry Visa or MasterCard logos. Some people use them to shop on the Internet, control spending or get around poor credit. Tax thieves use them to collect refunds from the IRS.

Police filed a report with the IRS.  Ms. Gamble denies any involvement with tax fraud.

The gist of the TampaBay.com story is that the multi-billion dollar refund fraud — much of which is based in Tampa — is largely the work of thieves who are also collecting money from you through public assistance, and a motley array of petty thieves.   And Doug Shulman’s IRS is helpless to stop them.

Or maybe they just have priorities other than protecting your tax money.  Priorities like expanding the power of the bureaucracyAn opinion piece in today’s Wall Street Journal by Chip Mellor of the Institute for Justice (via the TaxProf):

Under new regulations imposed last year—without congressional approval—the IRS now requires all paid tax preparers to become “registered tax return preparers” by paying extra fees, passing a government exam, and taking continuing-education classes annually. (Exempted from the mandate are attorneys, CPAs and politically powerful “enrolled agents.”) Big tax-preparation firms such as H&R Block and Jackson Hewitt supported the licensing scheme, as did lobbying groups representing CPAs and others who are exempted from new regulation. 

So while petty thieves loot the Treasury, rest assured that Doug Shulman’s IRS is doing what it can for the well-connected.  For a taste of what it Doug Shulman is doing for those whose identities are being stolen (darn little), check out the newest installment in Jason Dinesen’s saga of a client’s identity theft nightmare.

 

Billy Hamilton of State Tax Notes has a fine history of the Iowa Film Credit up today.  Unfortunately at the moment it is only available to State Tax Notes subscribers (here).  He uses a “film noir” theme to tell the story:

Unless all of the main characters are dead, life continues past the closing credits, and in Johnny’s case, that means arrest and a return to the Big House. But filmmakers and audiences seldom bother with what is, in effect, the story after the story.

     That probably helps to explain why there was minimal press attention when opening arguments began on July 23 in the trial of the last of 10 defendants charged in the Iowa film tax credit scandal that erupted three years ago and was a hot topic at the time in Iowa, in the movie community, and in tax circles.

If you get a chance, read the whole thing.

 

Peter Reilly, Should We Care About Romney’s Unreleased Tax Returns?:

The business culture that both Romney and Warren Buffett have  operated in, as have I at a much less ethereal level, considers overpaying taxes to be irresponsible.  That is the story of Romney’s tax returns.

I’ve not encountered a business culture that considers overpaying taxes to be “responsible.”  Peter’s post is worth reading for the “It’s a Wonderful Life” references alone.

 

Tax Policy Blog: Usain Bolt Serves the UK an Olympic Hangover and At least 90 Percent of Americans Have a Lower Income Tax Rate than Romney

Kay Bell: Romney’s tax returns take 2

Robert D. Flach has been busy, with a new “Buzz” and a look at RYAN’S TAX RETURNS.

Anthony Nitti, Tax Policy Center Fights Back

Jack Townsend, Swiss Banks Rat Out Their Employees to U.S.

TaxDood, Usain Bolt Serves the UK an Olympic Hangover

TaxGrrrl is moving her offices this week, so she makes the best of it with Moving Right Along: Deducting Work-Related Moving Expenses

Good news for Iowa’s Mississippi River towns: Illinois Adopts Strip Club Tax (Russ Fox)

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Tax Roundup, 6/21/2012: TaxGrrrl has a book; Iowa walks into the bar with your purse

Thursday, June 21st, 2012 by Joe Kristan

 TaxGrrrl has a new E-book out:Ask the TaxGirl: Everything Parents Should Know About Filing Taxes (Including Child Care Expenses, Medical Costs, and the Earned Income Tax Credit)“  $2.99 on your Kindle, surely a bargain.  Even more so if you also subscribe (99 cents per month) to the Tax Update Blog on Kindle!  

Kay Bell: Day camp, the tax advantaged summer child care solution for working parents

Taxing you to lure and subsidize your competitors: State economic development board to consider incentives for Von Maur, Amcor, others (Des Moines Register)  It’s like a guy walking into a bar with his wife’s purse to buy drinks for the girls.  They might let him buy drinks, but they won’t be impressed, and they sure won’t stick with him when his cash runs out. 

U.S. taxpayers abroad can extend filing deadline to December 15 (Phil Hodgen)

Jack Townsend: Is Israel the New Switzerland for U.S. Tax Compliance?

TaxDood: Offshore Tax Investigations: First Switzerland, Is Israel Next?

TaxTV: Tip Wages Subject to Employment Taxes Receive Clarification by IRS

Jana Luttenegger, IRS Issues Temporary Regulations on Portability (Davis Law Firm Tax Blog)

Shock: figure associated with Blagojevich charged with tax fraud (Hindustan Times)

Not safe for work?Bloomberg Pulls Up the Skirt on Romney’s Tax Proposal” (Anthony Nitti)

You never know what sort of career a public accounting background can lead to.  (Going Concern)

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Tax Roundup, 6/7/2012: tax advice in the wrong places; the Daugerdas do-over; DOMA doomed?

Thursday, June 7th, 2012 by Joe Kristan

Best advice?  Don’t take advice from the wrong place (Robert D. Flach):

 I have given it much thought and decided the best piece of tax advice I can give anyone is DO NOT ACCEPT TAX ADVICE FROM ANYONE OTHER THAN A PROFESSIONAL TAX PREPARER.

I usually continue my answer by saying “don’t listen to your brother-in-law, your cousin Manny, your auto mechanic, your neighbor or co-workers, or a guy you ride to work with on the train”.
 
But I also mean don’t listen to a broker, banker, insurance salesman, or other “financial professional”.
 
Some of the most awkward conference calls are with non-tax financial people who have advised clients to do things that don’t work.
 

DOMA Ruled Unconstitutional (Again) in an Estate Tax Case  (Jason Dinesen)

Maybe it should get out of profession-creating and jaywalker-shooting so it can do its job. Overseer: IRS Could Face ‘Serious Problems’ (Via TaxBreak)

Kay Bell: Film tax incentives sometimes lead to extra state costs for criminal prosecution.  Plus bonus history of drive-ins!

Paul Neiffer: Present is Better Than Future!  Present interests in property for gift tax purposes, that is.

TaxDood: Another Former Madoff Employee Pleads Guilty.  A Madoff employee cheating on taxes?  Hard to believe, I know.

Dan Meyer: USCoC: US Corporate Income Tax Rate is World’s Highest

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Tax Roundup, 5/24/2012: Vikings pillage taxpayers, Giant, Eagle choose not to help, and why it’s harder to do taxes than to eat right.

Thursday, May 24th, 2012 by Joe Kristan

Like the Vikings of Old: Pillaging Minnesota’s Budget (Tax Policy Blog):

This week in Minnesota politics has been instructive in what kinds of projects warrant state money and attention.  Governor Dayton signed a bill approving the construction of a new stadium for the Minnesota Vikings which he boasted would create thousands of jobs and would not use “a single dollar of General Fund tax revenues“. The state agreed to pay $498 million of the $975 million price tag for the new stadium, with $150 million of their contribution coming from the revenues of Minneapolis’s “hospitality tax” (a sales tax surcharge) and $348 million from electronic pull tabs.

Dayton championed the deal despite the growing body of research that, as academics have observed, “contains no evidence supporting the idea that sports facilities are important engines of economic growth.” That is in part because, as analysts at UBS note, the economic analyses used to support sports stadiums tend to over-estimate the benefit of stadiums by ignoring the substitution effect; individuals who would travel to spend money on live music and restaurants in the downtown area instead spend them on the professional sports team. 

It’s similar to the way Iowa’s economic development officials say they create jobs with tax credits, ignoring the jobs lost by the unsubsidized competitors of the corporate welfare recipients, and the economic activity that would have occurred had the state not taxed the money from us to give away in the first place.

$452 billion tax hike in 2013: Taxmageddon by the numbers (Tax Break):

The expiration of tax breaks like the 2001/2003/2009 tax cuts, as well as the payroll tax cut, estate tax breaks, the R&D tax credit for businesses, combined with the cost of the Patient Protection and Affordable Care Act (“Obamacare”), and other sundry items, will add up to the overall tax increase in 2013 of $451.8 billion.

Repeal of Tennessee Gift and Inheritance Tax Official (Tennessee Tax Guy).  “Without a true income tax, and now without gift and inheritance taxes, Tennessee will likely be viewed as one of the most taxpayer-friendly states of the nation.”  Are you listening, Iowa?  (No.).

Former Dwarf, Crow believed to be in compliance. Former Giant, Eagle Fails to File Tax Returns (TaxDood)

 TaxVox: A Path Forward on Tax Reform.  We’ll go down that path when there are no others left. 

Peter Pappas:  I Am Aaron Worthing (or My Contribution to “Everybody Post about Brett Kimberlin Day”). Is a convicted deomestic terrorist using a 501(c)(3) and celebrity money to threaten and silence political opponents?  More here.

Brian Strahle: Teeter-Totters, Musical Chairs and Tug of Wars: The World of Multistate Income Taxes

Anthony Nitti: Doctor Done In By Tax Court’s “Too Good To Be True” Logic.  The Tax Court says that there was no reasonable cause to file returns based on the word of a promoter of a Sec. 419 tax benefit scheme.

Kay Bell: Beware unsolicited — and questionable — property tax payment plans

More Americans are very confused: More Americans Believe It’s Easier To Understand Tax Than How To Eat Healthy (TaxGrrrl)

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Tax Roundup, 5/2/2012

Wednesday, May 2nd, 2012 by Joe Kristan

In case you need more evidence that your Iowa public officials hold you in contempt:  “Two decisions made in favor of mobile speed cameras; Supervisors OK them for busy Polk roads, while legislators kill a proposed state ban.”   Remember them in November. (Des Moines Register)

The lush life of the washed-up NFL player: three of them charged in ID-theft tax refund scam.  (Kay Bell, Bankrate.com)

Just another humble municipal public servant: Dixon, Illinois financial officer accused of helping herself to $53 million or so.  Think it ever hit her 1040? (Going Concern)

Sadly, they get to pay taxes for humble municipal public servants steal:The Price of Freedom: What Happens to the Wrongfully Convicted?” (TaxGrrrl)

Commissioner Shulman won’t rest until they’re all gone: Wealthy Americans Queue to Give Up Their Passports“‘There is incredible frustration at the audacity and imperial overreach of this law,’ said David Kuenzi, a tax adviser at Thun Financial Advisors in Madison, Wisconsin, referring to Fatca. “ (Bloomberg)

Death and Income Taxes.  My new post at IowaBiz.com, the Des Moines Business Record group blog for entrepreneurs.

Off the barbie: Crocodile Dundee settles Oz tax bill (Kay Bell)  TaxDood has more.

No.  “Would a Romney Presidency Bring Sweeping Tax Cuts?” With the debt we’ve been accumulating, avoiding tax increases will be an accomplishment. (Anthony Nitti).

Are the new broker basis reporting rules worth it?Five Challenges for the IRS’s New Capital Gains Reporting Rules“(TaxVox)

News you can use: Beating The Possible Estate Tax Increase Without Switching To Cat Food – The Midmill Dilemma.  An issue for folks with net worth of $4 million to $14 million. (Peter J. Reilly)

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A million bets a year…

Wednesday, March 14th, 2012 by Joe Kristan

…on HORSES? Taxdood thinks that may be enough bets to qualify a fellow as a professional gambler.

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Preparing for the post-NFL life — in prison

Wednesday, March 7th, 2012 by Joe Kristan

Packer fans with long memories may consider this a penalty called 8 years too late. Taxdood reports:

Freddie Mitchell has his place in NFL history. He was on the receiving end of a throw by Philadelphia Eagles quarterback Donovan McNabb on a 4th and 26 play during the final two minutes of the divisional round of the 2003-2004 playoffs. Had the pass fallen incomplete, the Green Packers would have won and advanced. Instead, the Eagles forced the game into overtime and eventually won the game.

6ABC is reporting Freddie Mitchell was indicted by a federal grand jury for conspiracy and income tax fraud.

Mr. Mitchell is alleged to have prepared a bogus refund claim for an NFL player and pocketing some of the proceeds.
Almost 80% of NFL players are broke within two years of retirement. Perhaps retired NFL players are not the best source of tax and financial advice.
Link: copy of indictment

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When you paint a target on your back, don’t run out on the shooting range

Tuesday, February 14th, 2012 by Joe Kristan

A Colorado man who helped push through that state’s bill of rights was sentenced yesterday to 180 days in jail and six years of probation on tax charges. He was accused of using a sham charity to hide income. He says he’s the victim of a political prosecution. From The Washington Post:

Douglas Bruce, a former Colorado lawmaker, said state officials went after him for promoting smaller government. He vowed to appeal.
“This is not the end. This is just

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Tax arrest cracks 20-year old murder case

Thursday, January 12th, 2012 by Joe Kristan

A DNA test on a sales tax cheat links him to a 1991 murder. TaxDood has the scoop.

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How the cards turned in 2011

Monday, January 9th, 2012 by Joe Kristan

TaxDood rounds up 2011 developments in taxing poker players.

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Roll away the taxes

Tuesday, November 29th, 2011 by Joe Kristan

With cigarette taxes soaring, more folks are rolling their own to save money, reports TaxDood. The Tax Update saw this coming.

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Dogg unchained

Friday, September 30th, 2011 by Joe Kristan

Taxdood speads the news that multitalented fusion blugrass-rap artist Snoop Dogg is catching up on his taxes:

The Tax Watchdog blog is reporting that Snoop Dogg has fully paid his $476,338 IRS bill. A lien reflecting that amount was originally filed by the IRS in December 2008. Typically, the IRS does not release a lien until after the liabilities associated with the lien are fully satisfied. Snoop should also request that the lien be withdrawn. A lien withdrawal actually removes the lien from the taxpayer

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What’s worse: federal prison or having your wife and girlfriend in the same house?

Tuesday, August 30th, 2011 by Joe Kristan

Few of us have the misfortune to taste either of the awful fates in the headline, but an Ohio real estate figure will now be able to compare and contrast. Thomas Parenteau of Hilliard, Ohio yesterday received a 22-year sentence for his role in a scheme to fraudulently obtain loans and evade taxes.
While at the peak of his career, Mr. Parenteau shared a house with his wife, his mistress, and his children by the mistress — though to be sure, it was a 30,000 square-foot house. Both the wife and mistress were caught up in the case.
The Columbus Dispatch reports:

Central to the case was a 30,000-square-foot mansion at 4500 Dublin Rd. overlooking the Scioto River near Hilliard. Parenteau and his wife, Marsha, bought it for $1.8 million in 2003 through a trust and then, prosecutors said, used fraudulent documents to obtain $18 million in loans against the property.
The case also involved seven other luxury homes.
Parenteau

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Thanks, Irene! IRS extends offshore ‘amnesty’ deadline because of storm

Monday, August 29th, 2011 by Joe Kristan

The IRS has extended the 2011 Offshore Voluntary Compliance Initiative deadline to September 9 as a result of Hurricane Irene. This gives anybody who has been trying to get a last minute submission in a little more time.
Linda Beale reports the news with the appalling headline, “Hurricane Irene Postpones Deadline for Offshore Tax Evaders to File Voluntary Disclosure” While tax evaders stand to do well by the program, the only people left who still think that everyone who hasn’t fully complied with the Kafkaesque offshore filing requirements are crooks seem to be Ms. Beale and some of the IRS agents running the program. In real life the IRS is clobbering expatriates who innocently violated reporting rules they had never heard of and immigrants who didn’t know how much the IRS wants to know about their foreign accounts.
More coverage:
TaxGrrrl
Russ Fox
Taxes in the Back
Jack Townsend

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It’s a small world, but it’s plenty big when somebody steals your Social Security number

Thursday, July 28th, 2011 by Joe Kristan

TaxDood tells the story of an Illinois man who, frustrated by years of mysterious tax problems because somebody else’s income was being reported under his Social Security number, took matters into his own hands. In tracking down the ID thief, he solved two mysteries:

A few years ago, Goodenough got a lead when the annual IRS notice contained someone else

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