Law Feed

Folks who cheat on their taxes to pocket extra dollars are infuriating enough to those of us struggling to do everything right on our 1040 forms. Folks who go to extremes to evade taxes are even more maddening. The Internal Revenue Service, however, has some good news for us here. It's Criminal Investigation (CI) unit is catching and convicting these tax criminals at a commendable rate. A 91.2 percent conviction rate in 2019, to be precise. That's among the highest of all federal law enforcement agencies, according to the IRS. And CI, which detailed that conviction rate and other successes... Read more →


Record-setting Cyber Monday sales means more porches across the United States will look like this. But the remote sales' boost to state tax coffers wasn't as big as some expected. $9.4 billion. That's how much U.S. shoppers spent on the just-passed Cyber Monday. That was nearly 20 percent more than last year's $7.9 billion tally for the annual and over-hyped Monday-after-Thanksgiving online shopping day. Obviously, the $9.4 billion in sales is a Cyber Monday record. Also obviously, all those online transactions will help out the state treasuries that now, in the wake of the Supreme Court's Wayfair 2018 decision, are... Read more →


Current state and local taxes deduction limit on federal Form 1040 Schedule A. We're wrapping up the second full year of living with the Tax Cuts and Jobs Act (TCJA) but some things still feel unfinished. Treasury and the Internal Revenue Service continue to issue guidance on various provisions, tax forms still are being tweaked, economists can't agree on the tax bill's economic effects and a key legal battle is still raging. The courtroom drama is about, you guessed it, TCJA's $10,000 limit on state and local taxes itemized federal deductions. Fighting a low-SALT tax diet: In July 2018, New... Read more →


Photo by Elaine Smith via Flickr CC It's been more than a year since the Supreme Court said states could collect online sales taxes from retailers who don't have any physical presence, aka nexus, in their states. But the internet tax collection process is still evolving. Going from a system where nationwide online sellers rarely if ever collected sales taxes from their customers to one — or actually multiple given the various tax system of states — where these purchasing levies are collected is not easy. Still, progress has been made. Online sales tax collection evolution: These taxes still are... Read more →


Even more intriguing, will Donald J. Trump now become social media's definitive Florida Man? Donald Trump, especially early in his presidency, spent a lot of time at Mar-a-Lago, his South Florida club and residence. Here, Trump and Melania in April 2017 welcomed the People's Republic of China president Xi Jinping and his wife Peng Liyuan to the Palm Beach abode. Now Trump says it, not Trump Tower in New York City, will be his official residence. (Photo via Trump's Twitter account and Wikipedia Commons). The hubby and I used to live in Donald J. Trump's future full-time home. Alas, for... Read more →


Nome, Alaska, is one of the cities in The Last Frontier that collects a local sales tax. The state's Gold Rush city is among the municipalities that will be able to unite under a new plan to collect sales taxes on online purchases. (Image: Wikipedia Commons) Alaska is known in the tax world as the only state that has no income or sales tax. The key word here, though, is state. The Last Frontier's local jurisdictions are allowed to levy local sales taxes. These tax-collecting communities now have a plan to work together to collect tax on online sales. Creation... Read more →


Attention, tax preparers. Next week is a big one. The filing extension deadline is Tuesday, Oct. 15. Then the very next day, the renewal season opens for paid Preparer Tax Identification Number (PTIN) applications and renewals. Also note that while there won't be any requirement to pay a user fee to obtain or renew a PTIN, this likely is the last time that the identification number assignments will be free. Last week, as the U.S. Supreme Court began its new term, the justices decided not to hear the case that reinstated the fees for PTINs. That means the ruling affirming... Read more →


via GIPHY The Kansas City Chiefs, with its star quarterback Patrick Mahomes, is among the handful of teams that National Football League watchers say have a shot at winning Super Bowl LIV next February. But the Missouri professional football team could be facing a tougher fight off the field. Last week, the Chiefs' attorneys argued before the Missouri Supreme Court that most of the NFL team's expenditures on items to renovate Arrowhead Stadium almost a decade ago should not be subject to the state's sales tax. This current court tax battle, which started in 2014, is due to an appeal... Read more →


The Trump Administration currently is embroiled in a whistleblower controversy. But another situation where a witness to tax wrongdoing — not any alleged Donald J. Trump activity! — has worked out much more satisfactorily. A $11.5 million award has been presented to a person whose information led to the government collecting over $44.4 million in taxes, penalties and interest, according to the whistleblower attorneys involved in the case. In announcing the award, attorneys Stephen M. Kohn of the Washington, D.C. firm of Kohn, Kohn and Colapinto and Dean Zerbe of the Houston-based firm Zerbe, Miller, Fingeret, Frank & Jadav, lauded... Read more →


Al "Scarface" Capone at his sentencing for tax evasion. Back in the Prohibition Era, federal agents — notably those from the Internal Revenue Service — took down the notorious gangster. The tax agency's Criminal Investigation agents are celebrating their 100th birthday this year. (Photo courtesy All That's Interesting: 25 Al Capone Facts) The United States' tax system is based on the premise that all income is taxable, including illegally earned income. Our tax system also relies on the voluntary reporting of that income, including ill-gotten gains. But human nature being what it is, that doesn't always happen, even with legally... Read more →


When California last year joined the literal growing ranks of states that have legalized marijuana, initial projections were that the state soon would be raking in $1 billion annually from weed-related taxes. That apparently was a pipe dream. The report on Golden State cannabis excise taxes collected between April and June was just $74 million. That disappointing revenue amount is this week's By the Numbers figure. Even more discouraging, California Gov. Gavin Newsom's office sharply scaled back projected tax dollars from the state's legal weed market. That's been the case in other states, too. In pushing through legal marijuana, both... Read more →


This February 2016 photo on Twitter of Donald J. Trump signing a tax return is one of the few, and unrevealing, looks we've gotten of his federal filings. The focus of Donald J. Trump and his White House change quickly. Issues that were boiling over just days ago quickly get pushed to a back burner by something else that's hotter. But some of those old topics are still simmering. And one of them, Trump's tax returns, saw the heat turned up a bit recently. It was, however, a former college student, not Trump, who was put on the hot spot.... Read more →


States as well as shoppers now must deal with remote sales taxes. (Image by Daniela Hartmann via Flickr CC) Just over a year ago, the Supreme Court of the United States (SCOTUS) struck down a previous ruling and expanded the ability of states to collect sales tax on from remote sellers. Many states in the wake of the 5-to-4 SCOTUS decision in South Dakota v. Wayfair have or are working on systems to collect sales tax from sellers who don't have a physical presence in their states. New Hampshire, however, has taken a different approach. The state has no sales... Read more →


North Carolina offers many gorgeous vistas, but the tax view for some trusts wasn't nearly so nice until a recent Supreme Court ruling. Now they can claim refunds of overpayments. (Blue Ridge Mountains viewed from Blue Ridge Parkway's Deep Gap overlook in western North Carolina; photo by Ken Thomas via Wikipedia Commons) You've got to appreciate the audacity of Tar Heel State tax officials. North Carolina decided it was due tax on a trust because a beneficiary was a state resident. That recipient of trust proceeds, Kimberley Rice Kaestner, was North Carolina's only connection to the trust. The person who... Read more →


//Kara's Party Ideas If you don't have to work on this post-July 4th Friday, then you're probably spending the day recovering from your patriotic and fireworks-laden celebrations. Some folks also are resting up from their birthday partying. Yep, I'm talking about those folks born on the Fourth of July. Famous 4th birthday celebrants: Several celebrities share this early July birth date. People magazine published a slide show and those from that presentation that caught my eye include: Eva Marie Saint, the Academy Award winning actress immortalized in On the Waterfront, which was directed by Elia Kazan and also showcased real-life... Read more →


Sometimes justice does prevail. Last week it arrived along with a dose of schadenfreude from all us who've paid, albeit usually grudgingly, our taxes over the years. On Friday, June 21, Virginia tax attorney-turned-lobbyist James F. Miller pleaded guilty to willfully filing a false tax return. And Miller wasn't just any National Capital area tax attorney. He was former employee of the Department of Justice' Tax Division. Again, schadenfreude. Six-digit tax bill on under-reported millions: The amount of money involved in Miller's case also is impressive. Miller, 67, under reported his gross income on his 2010 through 2014 tax returns... Read more →


The Internal Revenue Service wants the money you owe. It prefers you pay your taxes on time and in the conventional manner. But Uncle Sam's tax collector is not averse to working with delinquent taxpayers so that it can get the due taxes without an undue hardship on the debtors, such as via an installment payment plan. There are, however, limits as shown in two recent U.S. Tax Court cases. Within weeks of each other, two companies on opposite sides of the country, found their efforts to pay their very large tax bills over time overruled for basically the same... Read more →


Things that are never good: an unexpected envelope from the Internal Revenue Service. That's the assessment of one of my personal finance writer pals. Today, she's working to clear things up in connection with one of those mailing she got from Uncle Sam's tax man. It's not a fun exercise, but it's definitely one you should undertake if you disagree with an IRS decision. In fact, the IRS own Taxpayer Bill of Rights covers this situation in several of its tenets. Specifically, I'm looking at every taxpayer's right to: Pay no more than the correct amount of tax, Challenge the... Read more →


The Internal Revenue Service has formed a working group to look into allegations that some of its Free File members really didn't (don't?) want taxpayers to file for free. State and city officials have launched official investigations into or taken legal steps in connection with allegations that some tax software companies redirected online searches away from their free options on at the IRS website. Now what is being hailed as the first nationwide class-action lawsuit in the matter has been filed against Intuit, the maker of TurboTax. Tax software giant is legal target: It's no surprise that the tax software... Read more →


Michael Cohen (left) and Tom Arnold run into each other in New York City in June 2018. (Photo via Tom Arnold on Twitter) Michael Cohen, Donald J. Trump's former attorney and previously self-described fixer, is heading to federal prison in a couple weeks. But in a recent conversation with actor Tom Arnold, Cohen said he didn't commit all of the crimes for which he will do time. Specifically, according to the story on the telephone discussion that the Wall Street Journal broke, Cohen says he's not guilty of tax evasion, one of the charges for which he's going to jail.... Read more →