Video Course Evaluation Form. Atty ID number for Pennsylvania: Name of Course You Just Watched

Transcription

1 Garden State CLE 21 Winthrp Rad Lawrenceville, New Jersey (609) fax Vide Curse Evaluatin Frm Attrney Name Atty ID number fr Pennsylvania: Name f Curse Yu Just Watched Please Circle the Apprpriate Answer Instructrs: Pr Satisfactry Gd Excellent Materials: Pr Satisfactry Gd Excellent CLE Rating: Pr Satisfactry Gd Excellent Required: When yu hear the bell sund, write dwn the secret wrd that appears n yur screen n this frm. Wrd #1 was: Wrd #2 was: Wrd #3 was: Wrd #4 was: What did yu like mst abut the seminar? What criticisms, if any, d yu have? I Certify that I watched, in its entirety, the abve-listed CLE Curse Signature Date Garden State CLE, 21 Winthrp Rd., Lawrenceville, NJ fax

2 GARDEN STATE CLE LESSON PLAN A 1.0 credit curse FREE DOWNLOAD LESSON PLAN AND EVALUATION IRS COLLECTION PRACTICE With Ray Ash, Esq., CPA And featuring Rbert Ramsey, Senir Instructr Prgram descriptin Smetime the amunt yu we the IRS can be subject t negtiatin. Yu can help yur client and maybe even yurself by viewing this 1 credit CLE. Wh knws hw much yu can save?

3 Garden State CLE 2 IRS Cllectin Practices I. Intrductin Raymnd Ash, Esq., CPA II. Offer t Cmprmise Cmpanies (n televisin) claiming that if yu haven t paid IRS then cntact them and they will settle with IRS n yur behalf Settlements are unusual Cmpanies are putting tgether an ffer t cmprmise I Owe Yu (IRS) explains why didn t pay it IRS can accept There are nly 2 reasns fr IRS t accept yur ffer: 1) inability t pay present mnthly incme statement (incme and expenses), list assets, all assets and liabilities (balance sheet); r, 2) dubt as t liability prf n tax payer t prve that yu dn t we the mney use caselaw t prve yur psitin IRS is willing t treat back taxes differently frm late fees and ther penalties when settling When yu pay the tax that is wed the interest and penalties stp can indicate in each payment that payment shuld be applied t tax and nt fees/penalties IRS is willing t frg penalties they want the interest Get client t pay as much f tax as pssible Appellate Divisin is used fr tax issues mre infrmal prcess reasn with IRS attrney Chapter 13 r 7 bankruptcy can assist in aviding tax liabilities When bankruptcy is filed, all prceedings are stpped Likely that IRS is mre willing t settle because therwise nt getting mney until bankruptcy is reslved Filed the return and IRS did nthing t cllect taxes within a perid f time, tax ges int Chapter 7 and is dischargeable [IRS may try t have yu sign a waiver f the statute f limitatins.] Filed return and IRS des g after yu, then yu can put int Chapter 13 payment plan illustrates ability t pay Settlement cmpanies are negtiating with IRS and trying all different frms f pssible settlement Must file returns befre IRS will negtiate with yu Payment prgrams relatively shrt perid f time (3 years utside limit, IRS prefers 1 year), ging t pay interest, penalty stps nce yu make a deal and make first payment Persn can all IRS t make a deal dn t need settlement cmpanies First step lk at return that was filed maybe file an amended return, pssibly deductins that were missed (Frm 1040X) N increased issue f an audit because yu have a cllectin with IRS cmpletely separate areas f IRS Hypthetical : Year 1 wn mney in Vegas and didn t reprt, Year 2 lst a lt in Vegas under reprting incme equates t financial and criminal penalties Dn t deal with same IRS persnnel fr each case

4 Garden State CLE 3 IRS Cllectin Practices III. As an attrney, yu can call and get the ball rlling Talk t the agent wh made the assessment name n the letter received frm IRS agent has ability t make deals desk audit if a bank sends yu a 1099 interest statement, but yu didn t put it n yur tax return this wuld be picked up in a desk audit cmputer generated field audit - All incme reprted but there are questins need prf abut deductins that yu have taken; IRS can cme t yur business, yu can mail in dcuments Persn wh files return and desn t have mney t pay the taxes due: Cntact persn n ntice t discuss settlement 433A (individual), 433B( self emplyed) ask IRS t review and see what client can realistically pay Pwer f attrney t IRS s that attrney can call Practiner license is required t practice in IRS related matters IRS is willing t deal; mre willing t deal with self emplyed peple than with individuals interpretatins f deductins Either yu we the mney r dn t we the mney yu have the ability t pay r yu dn t have the ability t pay With businesses there is mre leeway because f the tax laws because certain things can be argued as deductins Minimizing Audit Pssibilities Fr Individuals Different things can trigger an audit Stay away frm the hme ffice nly get small percentage f deductin Vehicle expenses be careful straight mileage deductin is best because there is nthing t lk at because yu are using the IRS frmula keep a cntempraneus lg f mileage (1000 miles per mnth is suggested) Percentage f business use f car be cautius be cnservative Vehicle depreciatin if yu start depreciating a new car, then yu must begin depreciating; luxury vehicle rules can accelerate depreciatin but nt in the first year; anything ver 6000 lbs can take almst 100% as depreciatin (farm machines, pick up trucks nn- luxury vehicles) Certain levels f incme Travel and entertainment nly 50% deductin must evaluate relative t yur incme when reprting, als review in light f ther expenses lk at type f cmpany yu are perating Capital gains incme nt mre likely t be audited than thers but establishes that yu have assets s can t g back and say that yu can t pay yur tax IV. Alternate Minimum Tax wrse tax ut there Takes all write ffs such that yur incme is cmpletely eliminated Like a see-saw - incme dwn such that n tax cnsequences then AMT cmes back and says that yu have t pay this AMT

5 Garden State CLE 4 IRS Cllectin Practices Fr middle class peple nt intended fr that but that is wh it effects ($50- $200K per year incme with a lt f write ffs) Effects thse wh have emplyee business expenses expenses lwer incme tax but then AMT cmes in t increase mney due the IRS Des nt increase chance f audit Only subject t AMT when yu have a great deal f deductins t write ff against the incme V. Self Emplyment Tax 15% f yur net pay this frm first $1 that yu make based n net incme Paying bth halfs emplyee and emplyer Any incme ver $400 is subject t tax Generated by Schedule C this frm be an area that culd be an audit, i.e. kncking the incme dwn t lw, but nt the self emplyment tax itself After $106,000 net incme - n mre self emplyment tax VI. VII. VIII. Fraudulent return/unreprted incme cases Where is the line drawn t send t US Attrney s ffice 25% guideline- if they knw yu have incme f X and yu nly reprted 75% f that number Civil penalties 15% is guideline Otherwise IRS lks at ttal picture n hard and fast rules ther than the 25 and 15% guidelines (abve) What t d if yur client is being audited? Review return Ask: is this all the incme yu have reprted?? Mre imprtant t reprt all incme than t wrry abut deductins yu tk Criminal penalties cme when yu just didn t tell the IRS abut mney failure t reprt; nt when there are deductins Deductins are a difference f pinin Unreprted incme is really the mst imprtant issue file 1040X t crrect issue wuld reduce likelihd f criminal liability Request abatement f penalties and sme interest with filing f 1040X letter t audit agent Filing 1040X wuld make IRS happier gd strategy Reprt under-reprted incme Lk hard at deductins use fact finding sheet get t knw client; daily expenses; mileage lg maybe suggest deductins that have nt been taken Dealing with IRS Agents/Auditr They are prfessinals, nt persnal issue when ding audits Rated by files clsed and taxes recvered Incentive t reslve case with the path f least resistance wrks t agent s benefit tward psitive utcme

6 Garden State CLE 5 IRS Cllectin Practices Desk audits cmputer generated agents/auditrs wuld rather address these issues than thse larger issues when smene has t g int the field and deal with large crpratins and tax attrneys Mre mney is generated by desk audits being reslved Reasnable cmprmise shuld enable yu t clse the case At appellate level, agents/auditrs have full license t make reslutins different frm agent wh yu deal with initially IX. Hw Can the IRS Get Yur Mney t Pay Taxes Nt as tugh as they used t be because their hands are tied by Cngress Taxpayer Bill f Rights can t d what they used t d; used t be empwered t be abusive Current situatins threaten t levy bank accunt in the past they just tk the mney When mney is levied in bank, they have t wait 21 days t execute n the levy gives taxpayer time t reslve issue IRS will make a deal Mre pprtunity as a taxpayer t fix the prblem v. past practice Garnishing wages Shw true ability t pay IRS will verify If IRS believes yu cannt pay, IRS will remve the levy X. Advice t Attrneys G easy with IRS dn t g in with tugh guy attitude they are tugh t Trying t talk t IRS t negtiate need t pave the way fr that discussin Hw clse can yu cme t the middle negtiatins Very seldm will a case g t tax curt because at sme time yu will find the right appeal agent wh will say that this case des nt merit all this attentin find smene wh will agree with yur psitin and reslve the case Let client s expectatins be clear as t what will ccur and results Ads fr settlement agencies set expectatins that are unreasnable Must be hnest with yur client direct and up frnt with yur client lk at return, see if there are deductins that need t be taken, then if yu dn t find them then yu must tell client Must advise client that he/she must be cmpletely frthcming with infrmatin in rder fr attrney t advise yu Make client expectatins realistic dn t make client think yu are ging t wrk miracles the results are usually smewhere in the middle