acct560

Now the following information is well documented and is presented for your review and edification. Do not try to fight the IRS in federal court, you will not win. The deception runs rampant throughout the executive, legislative and judicial branches.

The tax courts provide us with a number of scenarios similar to the one faced by Adrian. In Kuhler v. Commissioner of Internal Revenue 18 T.C. 31 (1952) a taxpayer received a commission check on the evening of December 31, 1946, past banking hours, and reported its amount

If a taxpayer fail to file an FBAR but is a non-willful violation, may be imposed a penalty of a maximum $10,000. Taxpayers who willfully fail to report a foreign financial account may be subject to a penalty equal to the greater of $100,000 or 50% of the balance in the account at the time of the violation, for each violation, under 31 U.S.C. Section 5321(a)(5) (IRM §4.26.16.6.5). Willful violations may also be subject to criminal penalties under 31 U.S.C. Section 5322(b) or 18 U.S.C. Section 1001. (Joel M. Barker,

An individual taxpayer can avoid the penalty for underpayment if the payments of the estimated tax is at least as large as any one of the following:

Once the Tax Court has jurisdiction the IRS cannot begin collections until 60 days after the decision has become final . Although the court makes the final decision regarding the petitioner’ innocent spouse relief under Section 6015(b), 6015(c), or 6015(f), it is appropriate for the IRS to have the first determination . If the IRS has not made a decision regarding relief or if the IRS has issued a notice of deficiency and the taxpayer raises innocent spouse relief on the petition the Cincinnati Centralized Innocent Spouse Operations (CCISO) should review the request. The attorney for the Commissioner should request the administrative file before proceeding to trial. The Tax Court has specific stand-alone jurisdiction under Section 6015(e)(1)(A). However, the IRS argued the Tax Court’s jurisdiction over Section 6015(f). In Ewing v. Commissioner, 118 TC 494 (2002), the court relied on Section 6015(e) granting jurisdiction under “this subsection” (Section 6015 including 6015(f)). The Ninth Circuit Court overturned this interpretation finding that the language excluded this subsection . Congress amended Section 6015(e) to include equitable relief under Section 6015(f)

What Happens If Jeff’s Income Were $16,000 During The Year? Jeff probably won’t qualify for ObamaCare and will be sent to apply for Medical. As Jeff’s tax preparer, you only have to verify that he was covered through Medical inspecting his ID card.

The 501(c)3 tax code specifically for organizations that are reserved for educational institutions, churches or other nonprofit organizations including what is often deemed as charitable (Lavarda, 2009). There are two main reasons that an organization will seek to attain a tax-exempt status with the federal government through the Internal Revenue Services (IRS). First, is to provide for their beneficiaries a tax-deductible contribution, which allows taxpayers benefits when paying their federal income taxes and secondly, simply is for organizations the ability to not pay federal income taxes (Lavarda, 2009; Arnsberger, Ludlum, Riley, & Statnton, 2008). Organizations who seek out the tax-exempt status do benefit from the protection that the tax code provides, however due to tax code regulations and reform, organizations that do not heed to the code may be in jeopardy of violating the code. This violation will result in the IRS revoking the tax-exempt status. For emerging organizations that are on the cusp of defining their affiliations in society must determine if applying for tax-exemption status is a profitable move. Due to the scrutiny of these organizations and such organizations must take into account the liability that comes with the tax exemption status. The liability is not one that an organization can take lightly, if an organization does gain tax-exemption status and then later fails to abide by the regulations, the risk is simple; the revocation of the

In the case study of Gee Wiz, “Wanda David, a licensed CPA, works for Gee, LLC, a professional accountancy corporation with offices in Wisconsin and Illinois, in the audit department and she also has some small business clients that she provides tax services to in her spare time generally on weekends. Her employer does not know that she does this. Wanda never thought about a conflict of interests because the firm does no tax work. One of Wanda’s small business clients, Wiz Inc., was also an audit client of Gee and had fallen more than 90 days past due on paying bills. In her position with Gee, Wanda was assigned to the audit of Wiz and is responsible for preparing and estimating the Allowance for Doubtful Accounts. During the audit of Wiz’s financial statements during the week ending March 1, 2013, her boss asks her for justification for not including Wiz Inc. in the 90+ day aging report. It seems there are some audit-related questions about the collectible of the Wiz account. Wanda came up with an explanation for not including the Wiz account in the estimated allowance and her boss was satisfied. Within a week of this request, Wanda is given a nice promotion and raise, but she has to transfer to the office of Gee in Chicago for the new job. Wanda accepts the promotion, leaves immediately, and decides to quit doing accounting on the side. In moving, Wanda does not complete the corporate tax return for Wiz on Form 1120, which should be filed with the IRS by March 15. She also

John Paul (“Paul”) set up a church, Our Lord’s church of Devine Exemption (OLCDE), to prove how ridiculously easy it is to abuse the tax system. R. at 3. Paul’s church met the requirement of I.R.C. § 501 (c)(3). R. at 5. During the tax year of 2012, Paul received a parsonage allowance from the church in the amount of $2,400,000. R. at 6. Paul filed a tax return for the year 2012 and excluded the amount received as parsonage allowance. R. at 6. Paul relied on the I.R.C. § 107(2) which allows the exclusion of housing allowance paid to ministers of the gospel for their services. R at 6. The Internal Revenue Service (“IRS”) rejected Paul’s claim. R. at 6. The IRS determined that the housing allowance was not compensation for services provide

Under the Internal Revenue Service (IRS) donee and Donor information requirements are important for a 501(c)(3) nonprofit organizations. Charitable organizations failing to obey to these IRS regulations are subject to penalties and other related legal actions. Regulations issued by Internal Revenue Service (IRS) concerning how to file form 8282 donee, Information Returns (Sale Exchange or Other Disposition of Donated Property and form 8283 Noncash Charitable Contributions Instructions gave clear and detail guidelines on how to make determinations with regard to reporting requirements on tax credits requested by an individual giving donations to charitable organizations.

For each item of donated property, they must maintain a reliable written record that includes the following: (1) the name and address of the church; (2) the date and location of the contribution; (3) a detailed description of the property; (4) the fair market value of the property at the time of the contribution, including a description of how the value was determined; (5) the cost of the property; (6) an explanation of the amount claimed as a deduction in the current year (if not all is claimed during that year); and (7) the terms of any agreement between the donor and church relating to the use, sale, or other disposition of the property.

Taxes are a major contributor of the American economy. The tax system in the United States depends on voluntary compliance, which means that each citizen is responsible for filing a tax return when required and for determining and paying the correct amount of tax”. (Albrect, Albrect, Albrect & Albrect and Zimbelman). When individuals under report, exaggerate deductions, and hide money in off shore accounts, this is clearly misrepresentation of their income to the Internal Revenue Service (IRS) and is deemed tax evasion. The term “tax evasion” is defined as using illegal

Sam arrives 15 minutes before his appointment. He gives the receptionist his name and takes a seat. Shortly after, Sam’s name is called and he follows his advisor into his/her office. Before the advisor proceeds to orient him in the process and set expectations, he hands him/her the required tax documents. After listening to his advisor, he asks questions. The advisor does a great job in answering his questions. The tax interview is then conducted. Upon completion of the interview, Sam reviews his return in its entirety. It is then submitted to the IRS for approval. Sam gets up and thanks his advisor for his/her time.

A charitable donation refers to a gift made by an organization or an individual to a private foundation, charity or non-profit organization. The U.S has allowed deduction on income tax to individual and corporate donors for their charitable donations since 1917 (Colinvaux & Dale, 2015). Often, these donations represent the main source of funding for most of the nonprofit and charitable organizations. In most countries, a charitable donation made to any of the qualifying organization entitles one to an income tax deduction. Organizations that do not qualify as charitable are considered for-profit and are taxed accordingly to that effect. The Charitable Contributions Deduction entitles taxpayers to a tax deduction for the financial year in which they made their donations. The aim of this essay is to compare between the taxation of donations made to a charitable organization by a corporation and that made by an individual.

The standard economic framework by Allingham and Sandmo (1972) and the expected utility theory suggest that higher audit probabilities and higher tax fines discourage cheating of taxes (Adreoni, Erard & Feinstein, 1998; Kleven et al., 2011; Maciejovsky, Schwarzenberger, & Kirchler, 2012). People normally evaluate the costs and the benefits of a certain course of action before making a decision. In an attempt to minimize the tax burdens, taxpayers weigh the utility benefits of avoiding or evading taxes successfully and the utility costs associated with the risk of probable detection and punishment (Maciejovsky, Schwarzenberger, & Kirchler, 2012). Thus, taxpayers are becoming wary in their tax compliance for every business activity as the government is shifting its focus on recovering its lost revenues from the evaders.