Wednesday, June 5, 2019

Who do I choose?

Who do I choose?

Things happen that are beyond our capacity. For instance, you receive a letter from the IRS stating they are going to audit your tax information for the past years. Another example can be that a family member has passed and left you as trustee of their estate.  What do you do?  First off, take a deep breath.  Know that there is help out there.

There are many attorneys who would like to speak to you. When choosing an attorney, make sure that they are the right fit for you.  Many will want you as a client and not all will fit your needs.  You should speak to family and friends to see if they have suggestions. They could suggest an attorney from their experience.

You can do research on the attorneys before you call to schedule an appointment. Doing your due diligence can save you time and money. Schedule to see more than one attorney before choosing the one that is right for you.  It will help you to feel more secure in your decision.

After scheduling your appointment write a list of questions and bring any documentation that you feel is pertinent to your case with you. Listen to what the attorney has to say and make sure that you feel comfortable with the attorney.

Know that you have a choice when needing an attorney. Rushing a decision can make you feel not so good and like you made a poor decision. Attorneys are people too and understand the hardships that you are facing.  They want to help.

Wednesday, May 22, 2019

ABC's Of Litigation

ABC's of Litigation

A:  Appeals, Answer and Agreement.  Appeal: 
Almost any outcome in one court can be appealed to the next higher court.  Some decisions of the Justice Court, for example, can be appealed to the District Court, and likewise, a decision of the District Court can be appealed to either the Nevada Court of Appeals or the Nevada Supreme Court. In 2014, the voters of Nevada approved the creation of a court of appeals, and the categories and rules governing which cases will be heard by that court are evolving. Thus, almost no matter what outcome is obtained by one party, an appeal might still be possible the non-prevailing party.  This can cause litigation to drag on for much longer than parties expect when the first initiate their lawsuit. 

Answer: After a Plaintiff files a Complaint, the Defendant is required to file a response, which is usually, but not always an Answer. The Answer will contain a response to each and every allegation contained in the Plaintiff's Complaint.  An alternative to an Answer might be a Motion to Dismiss if the Defendant believes the Plaintiff's Complaint is not properly drafted.  

Agreement:  Oftentimes, a contract (agreement) will have a provision in it that sets forth in which state (jurisdiction), and even which city (venue) a case will be tried.  This is sometimes referred to as a "choice of law" provision.

B: Bankruptcy" might seem like a strange category to consider when thinking about litigation, but it should actually be a very important part of the analysis undertaken when considering undertaking litigation.  If one's potential opponent does not have a good deal of assets, it might prove an effective strategy for them to simply file for protection under the Bankruptcy laws, which might very likely result in a plaintiff receiving nothing for the expenses incurred in undertaking litigation.

C:  Complaint, Candor, Collection. 
As alluded to above, the most typical way a lawsuit is initiated is by one party (the Plaintiff) filing a Complaint with the court.  There are requirements that cover when, and in which court this can be done.  At the most base level, the amount in dispute between the parties will be the primary consideration.  Amounts in controversy in excess of $15,000, for example will mean the Complaint will be filed in the District Court for Nevada. Lesser amounts in controversy will be properly filed in either Small Claims or the Justice Courts.

Candor:  If you choose to have an attorney represent you, he or she has a duty of candor with the court.  This means the attorney cannot lie to the judge, but it does not mean he or she has to simply tell the judge everything, or anything you tell them.  Between an attorney and their client there exists a seal of confidentiality which allows for openness between them, which allows the attorney to assist the client within the law.  An attorney's candor with the court means that they cannot intentionally lie to the court or hide a fact that would cause the court to make an improper ruling. Oftentimes a judge will hear things that, although harmful to one party, will, nonetheless, not be part of the basis for the court's ultimate ruling.  

Collection:  It is useful to keep in mind that just because one party obtains a judgment against the other, does not always, or necessarily mean that the winning party will be able to collect any money.  As discussed above under "Bankruptcy", there are ways for a Defendant to no have to pay a judgment.  In addition to filing for bankruptcy, a defendant might simply not have enough assets, or might have lost their job, or be protected by the law against collection.  One example of this is if the defendant is receiving a pension that might be protected and/or they have filed a homestead on their home, meaning a prevailing Plaintiff cannot force them to sell the home to collect the judgment. If a Plaintiff can get a garnishment order against the Defendant's pay, the law only allows a small percentage to be collected at one time, meaning it could take years to collect all the money due on a judgment.  

Copyright Hans Baldau  

Tuesday, May 14, 2019

IRS Tipping Payouts

Business is good right now for anybody willing to turn tax cheats in to the IRS. Last year, the Service awarded more than $312 million to tipsters, according to a report released in February. This is exponentially greater than the then-record year of $125 million in 2012. Why? Because the 2018 tax collection results from whistleblowers was revenue of $1.4 billion, compared to $191 million netted from the same efforts in 2017. Last year, one tipster was awarded $100 million for turning in a multi-national corporation.
2019 is not looking to slow down, either. So far this year, the Service has paid out $115 million to whistleblowers.

This surge in payouts reveals that the expansion of the IRS’s whistleblower program is gaining traction. The change was approved by Congress in 2006 and allows the IRS to pay up to 30% of the revenue collected to the tipster. The large percentage is usually applied in cases of over $2 million, while smaller percentages are applied in smaller cases.
Last year, the IRS paid out only 186 small-program awards totaling about $12 million, an average of $64,500 per payout. The larger cases received payouts of $300 million on 91 cases (up from just 15 cases in 2015).

Notably, the whistleblower need not be an employee or in any significant way connected to the taxpayer they are turning in. A tip may be as simple as a neighbor turning in someone they notice with a new car or lavish vacations, but no employment.

It is also important to note that the whistleblower does not have to be completely clean, either. While helpful, the law doesn’t prohibit them from receiving a benefit unless they were architects of the cheating. The most notorious example of this was Bradley Birkenfeld, who blew the whistle on UBS and received a $104 million payout after serving his term of 30 months in prison for his role in the scheme.

However, as simple as qualifying may seem, there remains the hurdle that the IRS rejects about 75% of claims right away. This can be for a lack of supporting evidence, plausible alternate explanations, or simple the size and effort required to pursue the tip.
Another caution for any would-be tipsters: a payout can take a very long time. The February report states that payouts take at least seven years, while five years is considered “fast.”

Most whistleblowers seeking awards us specialized tax attorneys to prepare their submissions. Those attorneys may charge an up-front retainer or up to 40% of the resulting payout to the tipster. Using an attorney can ensure that the tip and materials are packaged in a manner that is more likely for the IRS to pursue the case. The packaging can include account statements or other evidence that the attorney knows the IRS would want to see.
And of course, those who receive these payouts … must pay income tax!

Wednesday, May 8, 2019

Communication in the Work Place

Communication is the core to a productive and successful work environment.  Communicating is vital between co-workers; it prevents misunderstandings and conflict and creates a healthy ,peaceful environment. Communication gives you the tools to understand your co-workers and their needs to build a successful business.  It is also vital for client relations.  It is very important to communicate with clients, to understand their needs, and to resolve conflict.  Presenting new information and discussing with clients different options can be the difference between a satisfied client and an unhappy one. Good communication will keep everyone connected to the mission and vision of the projects for a successful future for the business. 

Thursday, May 2, 2019

Are you Ready for Retirement?

When Social Security was created, it was meant to supplement a person’s other retirement savings.  Too many Americans today, however, do not have other retirement savings and do depend on Social Security as their only income in retirement.  Many of those who had retirement savings were forced to tap into those accounts during the recession in the early 2000s and have not been able to rebuild their retirement accounts.  It’s not too late; take steps now to save something for your retirement.  There are a number of options available for retirement savings.  For those whose employers offer a 401(k) or similar program at work, participation in those programs offer great tax advantages.  There are traditional Individual Retirement Accounts (IRA) that offer tax savings now or Roth IRAs which offer tax savings later.  If you own your own business there additional opportunities and programs available to you.  Depending on your income level, you may even qualify for a small tax credit called the “Savings Credit”.

Friday, April 26, 2019

Estate Planning For The Single Parent

You might be thinking why would I need an Estate Plan if I'm a single parent, aren't they just for couples?  No, they are not just for couples.  An Estate Plan can help single parents.  Since Nevada does not use the Uniform Probate Code the procedures are not considered streamlined.  Having an Estate Plan can cover your children in a way that you want them to be covered.  It can direct the actions you want to take because it is specific to your needs and wants.

Having an Estate Plan will ensure that you, as a single parent, are looking out for your children even after you are gone.  Your assets can be given out in the way that you would want them to be and your children can be taken care of the way you desire.

It's hard to think about the future, especially when you are a single parent.  Take the time to plan ahead.  Schedule a time to come in and discuss your Estate Plan.

Thursday, April 11, 2019

Federal Tax Return

Keeping your Federal tax return after being prepared can be complicated. The rule is a minimum of three years.  However if you deal in stocks and bonds or Real Estate or Business you should keep them for basis purposes. 

If you are in a dispute with the IRS you should keep your return until the audit or dispute is over.  If you are in a dispute other than with the IRS you should keep your returns as far back as needed (possibly since inception).  If you are going through a divorce I would not shred them,as often your returns are going to be used in the divorce proceedings.

Monday, March 11, 2019

Refund Delays

With filing season upon us, millions of taxpayers are anxiously awaiting their refund. Some will be coming in the mailbox while the faster route is to receive it directly deposited into your bank account. That lump of cash has to be the best part about filing your taxes!
After filings, taxpayers anxiously watch the clock: When will it get here?! I have a new television I want to get or a trip to book! Unfortunately, there are some factors that contribute to the delayed payment of refunds.
First, state tax security delays can trip up the process. These can be chalked up to safety and identity concerns. Many states often publish any anticipated refund delays informing taxpayers about refund fraud. Because of that, the new standard procedure is that some states don’t begin processing refunds until March. This is because states can’t afford to lose millions of dollars by sending refunds to fraudsters and to the taxpayer who deserves it.
There also may be an issue with your federal return. Sometimes the IRS identifies an inconsistency and has to get in touch with you to reconcile the problem. Remember, though, the IRS will not call you over the phone and threaten to send you to prison. These issues are addressed by regular U.S. mail. In order to minimize any opportunity for inconsistencies, we recommend that you use a qualified tax return preparer. Because the IRS cannot send our your refund until the issue is resolved, it is always better to address them sooner rather than later.
Finally, there may be a matter of refundable credits. A taxpayer with refundable credits may still receive a refund even if they didn’t overpay in taxes. These are based on many financial or social factors such as earned income or family size.
Unfortunately, these credits are a target for fraudsters, especially in the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC) areas. Because of this, these credits on a return draw closer scrutiny.
To cut down on fraudulent returns, the PATH Act was passed in 2015 to require those returns claiming suspect credits be held an extra few weeks for additional review.

Tuesday, January 29, 2019

2019 Deferred Compensation Limit

With final rush of 2018 year-end planning, many taxpayers are making a New Year’s resolution to not go through that again. Fortunately, the IRS announced the 2019 deferred compensation contribution limits in it Notice 2018-83. That Notice contained higher limits for the coming year, which would be wise to take advantage of. Briefly, the limits identified in the Notice include:

·         The salary deferral limit for 401(k), 403(b) and 457 plans increases to $19,000.
·         The SIMPLE deferral limit increases to $13,000.
·         The annual additions limit for defined contribution plans increases to $56,000.
·         The annual additions limit for defined benefit plans increases to $225,000.
·         The annual compensation limit increases to $280,000.
·         The Social Security Wage Base increases to $132,900.
·         The compensation limit for determining who is a highly compensated employee increased for the first time in five years, and is now $125,000.

These are specifically outlined in the Notice

Wednesday, January 16, 2019

IRS Guidance on Tax Withholding for 2019

The beginning of the year is always a good opportunity to review w-4 withholdings for employees. On Tuesday, November 27, 2018, the IRS issued guidance on withholding questions for 2019 in Notice 2018-92. It states that the rules will mostly continue to be in effect from 2018 through 2019, including a similar Form w-4. Minor adjustments incorporate the changes to tax liability and withholding resulting from the Tax Cuts and Jobs Act (TCJA), P.L. 115-97. A new Form w-4 is expected to be released in 2020.
The Notice also announced that the IRS intends to develop further regulations for the TCA, specifically under Secs. 3401 and 3402, as amended by Section 11041 of the TCJA. These include:
Withholding allowances: This term has replaced the previously used “withholding exemptions.” This is due to the elimination of personal exemptions by the TCJA (at least until 2025).
Change in status: Any time that an employee’s circumstances result in a change in their withholding allowance (e.g., birth, death, marriage, etc.), that employee is required to notify the employer within ten (10) days. The Notice eliminates any requirement for the employee to notify the employer only if that change is the result of the TCJA. The requirement in such an event is that the employee provide a new Form w-4 to the employer on or before May 10, 2019.
Failure to provide Form w-4: Employees must provide a Form w-4 to their employer. In the event that they fail to do so, the Notice states that the employee may be treated as single, but entitled to the number of allowances computed pursuant to the Commissioner’s IRS Publication 15 (Circular E), Employer’s Tax Guide.
Estimates of Sec. 199A deduction: Much has been made of this significant component of the TCJA. With regard to employees, the Notice does allow a taxpayer to estimate the allowable Section 199A deduction in conjunction with calculating any additional Sec. 3402(m) allowance.
Withholding calculator: The IRS has provided an online withholding calculator and published further guidance in Publication 505, Tax Withholding and Estimated Tax. The Notice advises that the IRS will be working to enact regulations permitting the use of the calculator rather than relying on the tables provided with the Form w-4.
Combined withholding tables: The Notice states that these are marked for elimination for Federal Insurance Contributions Act (FICA) withholdings under Reg. Secs. 31.3402(h)(4)-1(b) due to complexity.
Written notice: Previously, an employer was required to send written notice to the IRS where an employee for whom the IRS had previously issued a letter locking in his or her maximum number of allowances left the employment (either voluntarily or involuntarily). That requirement has been suspended.
While the comment period remains open through January 25, 2019, the guidance affords employees and employers alike an opportunity for an annual review.

Who do I choose?

Who do I choose? Things happen that are beyond our capacity. For instance, you receive a letter from the IRS stating they are going to...