Tax Resolution | Tax Problems? Past or Present...

Tax Resolution | Tax Problems? Past or Present...
Has it been awhile since you filed a tax return?
• Feeling guilty? Scared?
• Don't know what to do or where to turn?
• Past Due Taxes are a Serious Problem!
• Do you even need to file? Yes.

Your first step to solving these problems is calling our office...
We will help you with the following:
• Settle your tax debt with the IRS for your reasonable collection potential (RCP)
• Handle all negotiations with the IRS for you
• Protect your paycheck and assets from the IRS
• Negotiate an affordable monthly payment plan to the IRS
• Discharge tax liens from your credit and property
• Negotiate with the IRS even if you have never filed a tax return!
• Prepare past due returns.

  

Volunteer

If you come forward and voluntarily file your missing tax returns, the system works more in your favor. Since nearly three out of four tax returns filed are due a refund, there is a good chance that the IRS might owe money to you. The only catch is that if you don't ask for your refund within three years, the IRS isn't going to give you what was yours in the first place. We are available to help you file your returns and, if necessary, act as your representative before the IRS. We work for you, not the IRS. Sometimes things just happen. If there is a good reason for not filing a tax return, some of the penalties can be reduced. Generally, if the IRS owes you a refund there are no penalties at all.

Scared of Volunteering?
If the IRS decides to come looking for you, life can become very difficult and frequently embarrassing. There is a chance that your employer might be requested to send part of your paycheck to the IRS instead of handing your paycheck to you. Your bank account could be frozen or even seized. A lien could be placed on your house. In the worst case, you could face criminal prosecution.  

What if you owe money?

Installment Agreements -- If you can pay the full amount within five years, you should be able to set up a monthly payment plan and make regular installment payments.  The IRS is now accepting Partial Payment Installment Agreement (PPIA).

What if you owe a lot of money?
Offer in Compromise -- If you owe so much money that you will never be able to pay your tax liability, we may be able to work out a compromise where the IRS will accept less than you actually owe. If the IRS accepts your Offer-in-Compromise (OIC), your total tax liability including interest and penalty is considered paid in full. An OIC is a mathematical formula, NOT an amnesty program. Professional assistance is strongly recommended when compromising a tax liability. 

Professional assistance

Don't be afraid to ask for help. By law, you have the right to professional representation. Only an Enrolled Agent, certified public accountant or attorney can represent your case before an IRS Collections Officer. Remember, your representative is working for you.

The IRS has ten (10) years from the date of a tax assessment to collect a debt from the taxpayer.

• The date the collection statute expires is called the Collection Statute Expiration Date or CSED.  IRC §6502 provides that the length of period for collection after assessment of a tax liability is ten years. 
• When the CSED date passes, the IRS is barred from attempting to collect your tax debt unless you waive the enforcement of the statute.

• When Does the Collection Statute Start to Run?
  • The statute starts on the day an IRS assessment is made.
  • Generally, the dates of assessment are as follows:
    • Filed tax returns – The date you mailed the tax return plus six weeks.
    • Audit Adjustments (agreed) – The date you signed the auditor’s report plus three weeks.
    • Audit Adjustments (unagreed) – The date the appeals process and the tax court process (if any) is completed and the tax court judge has issued his or her ruling.

• What Will Cause the Collection Statute to be Extended?
  • The Collection Statute can be extended (tolled) by one or more of the following acts or situations:
    • The filing of a bankruptcy petition - The statute is extended for duration of the bankruptcy proceedings.
    • The filing of an Offer in Compromise - The statute is extended for duration of the Offer or one year, whichever is greater.
    • The filing of requests for relief – The statute is extended when a taxpayer files for a Collection Due Process (CDP) hearing, Innocent Spouse Relief and any other form of relief that requires the IRS to suspend collection enforcement while it reviews the validity of the underlying assessment.
    • The signing of a waiver extending the statute - The statute is extended to date indicated in signed waiver. Never sign a statute extension without first consulting your tax advisor.
    • The taxpayer is out of IRS jurisdiction – The statute is extended for duration taxpayer was out of IRS jurisdiction.

• Example:  10-year period begins to run with the date of the “assessment,” not the tax year for which taxes are due. For example, if the return for 2005 is not filed until 2008 and the tax is assessed in 2009, the 10-year period begins to run in 2009 and expires in 2019.  Ten years is not always the limit. There are a number of other ways the 10-year collection period may be extended. For example, during the period an Offer in Compromise is pending, the statute of limitations is extended accordingly. Similarly, if bankruptcy is declared, while the bankruptcy proceeding is pending, the 10-year statute of limitations on collection is extended by the duration of the bankruptcy proceeding.

• Many types of court actions may also suspend the running of the 10 years. The filing of an IRS levy or a judgment entered in a Federal Court in a suit by the Department of Justice can also extend the 10-year period. The IRS can ask the Department of Justice to institute a collection proceeding in Federal District Court. If such a proceeding is begun and the United States Government prevails, then the statute of limitations on collection on that judgment is extended for the period generally allowed to collect such judgments, and such judgments can be renewed subject to the discretion of the Court.

• If the tax return was prepared by the IRS (Substitute For Return - SFR) under the authority of IRC §6020(b) the statute of limitations on assessment and collection shall not apply. IRC §6501(b)(3) Rev. Reg. §301.6501(b)-1(c).

• What options are available to me to solve my tax problems?
  Among services we offer:
  • Currently Not Collectible (CNC) - When the taxpayer cannot afford to pay the IRS monies due to a lack of assets and low income or no income (e.g. recently laid off due to current economy, divorce, illness) then the IRS will deem the taxpayer Currently Not Collectible (CNC) (Code 53) and agree that their tax liability will be suspended for the time being.  
  • Installment Agreement (IRC §6159) - A monthly payment plan set up to pay back the taxpayer's tax liability. The IRS has guidelines as to what amount they will accept and the time frame they will accept it in (usually sixty months). A financial affidavit (Form 433-A) is required from the taxpayer before the we can negotiate an installment agreement.   Under an installment plan, you make monthly payments on your tax debt for up to five years.  This is something you can do on your own.  The IRS fee to set up an installment plan is $105, or $52 if you agree to have payments automatically debited from your bank account. Approval is automatic for taxpayers who owe $10,000 or less and are in good standing with the IRS.
  • Offer in Compromise (IRC §7122) (We do legitimate offers!) - An offer to the IRS to lower the total tax liability owed by the taxpayer due to financial constraints. This is a very popular solution advertised on TV.  Under the offer program, the IRS agrees to accept less than you owe.  But to obtain a permanent reduction in your tax debt, it's not enough to show the IRS that you can't pay your tax bill.  You must also prove you've exhausted all of your financial resources and have little hope of raising money in the future.
  • Penalty Abatement - The IRS assesses penalties and interest on tax liabilities so over time taxes due years ago can increase from hundreds to thousands of dollars. The IRS will sometimes lower or eliminate these fees with a well worded request.  The IRS won't grant penalty abatement without reasonable cause.  For example, a widow who filed her tax return late because her husband died shortly before April 15 might qualify for penalty abatement.  If you believe you can show extenuating circumstances, you can apply on your own or ask your tax preparer to file a request on your behalf.  
  • Bank Levies/Wage Garnishment Release - The IRS will collect their monies due by any means necessary. They may take all your assets with a levy or garnish up to 70% or your wages.  We can negotiate with the IRS to have these released in as little as 4 business days.
  • Audit Representation - If you are currently being audited and you don't know why, it is very important to be represented by a tax professional who can get to the bottom of the problems and fix them. We can have your past audit reopened if you feel you did not get a fair shake.

I have unfiled taxes from previous years but no longer have my records from those years. Can you help me?

We can prepare your past unfiled tax returns by requesting your IRS wage transcripts and completing a tax questionnaire. Six (6) year filing requirement for past-due returns per IRM 4.12.1.

Is there anything I need to do before I can solve my tax problems?

Before the IRS will accept any negotiations to solve your tax liability you will need to be in compliance with any unfiled tax returns. Any unfiled taxes up to ten years ago may be required to be prepared and filed with the IRS.

If you owe the IRS money, you have options:

• Talk to a enrolled agent who has experience dealing with IRS collection issues. If you already have a tax preparer, he or she may be able to help you or refer you to someone who can.
• If you can't afford to hire a tax professional, you may qualify for a Low-Income Tax Clinic. 
• If you have tried unsuccessfully to resolve your problems with the IRS, you may be able to get help from the Taxpayer Advocate's office. For more information, go to IRS Taxpayer Advocate, or call 877-777-4778.

Payroll Taxes - IRS Unveils Key Penalty Findings

Payroll Taxes - IRS Unveils Key Penalty Findings 

Courtesy: Robert W. Wood 

I keep noting how bad IRS payroll tax penalties can be.  See When Payroll Taxes Go Criminal.  Although any tax dispute is bad, payroll tax disputes are especially bad.  How does the IRS build a case against you?  An IRS internal  memorandum provides guidance to IRS employees how to document cases against employers.

If you’re in business you must withhold tax money from employee pay.  Then you must account for it and send it promptly to the IRS.  Failing to pay not only makes the business responsible—you are personally on the hook. When you withhold tax but fail to remit it the IRS will come after you. The IRS views it as trust fund money.

In a cash-strapped business, keeping the lights on or the warehouse stocked can seem more important.  You may think you can pay the IRS later.  But these problems have a way of snowballing, so keep payroll taxes current at all times.

Business owners and other “responsible persons” have personal liability. The IRS can assess a Trust Fund Recovery Assessment—also known as a 100% penalty—against every “responsible person.”  Under Section 6672, the penalty equals the entire amount of trust fund taxes. The IRS can seek to collect 100% from the business and 100% from each responsible person. The IRS often makes an assessment against every officer, watching them turn on each other.  One person may get stuck while others get off scot-free.

The new IRS memorandum says revenue officers should determine case-by-case how much documentation will support a penalty.  Key issues are the “responsibility” and “willfulness” factors. In determining “willfulness,” courts focus on whether you had knowledge of the non-payment of taxes or showed reckless disregard whether they were being paid.

But a person need not actually perform the withholding and payment functions to be considered “responsible.”  If you have signature authority (whether or not you exercised it) while other (non-IRS) payments are being made, that can be enough to result in liability. Most of the time, here’s what the IRS will collect to sink you:

1. “Form 4180” interviews: Form 4180 is the form that is used by the IRS to conduct interviews with each potentially responsible person;
2. Articles of incorporation;
3. Bank signature authority cards or electronic PINS/passwords; and
4. Copies of cancelled checks (or electronic payments or debits) demonstrating payment to other creditors (not the IRS).  If the IRS can’t get the records easily from the business, the IRS will issue a summons to the business, the bank or both.

Individual factors will influence the amount of documentation needed to support a penalty. IRS revenue officers are directed to exercise judgment whether they need more.  Often, though, these key elements will be enough to impose and support the penalty so be careful.

For more, see:

Supreme Court Deaf To Payroll Tax Woes

Don’t Cross The IRS On Payroll Taxes
Fail To Pay Payroll Tax: Go To Jail
Robert W. Wood practices law with Wood LLP, in San Francisco.  The author of more than 30 books, including Taxation of Damage Awards & Settlement Payments (4th Ed. 2009, Tax Institute), he can be reached at Wood@WoodLLP.com.  This discussion is not intended as legal advice, and cannot be relied upon for any purpose without the services of a qualified professional.

Offer in Compromise Pre-Qualifier online tool

Offer in Compromise Pre-Qualifier online tool.  This online tool can be used to determine if a taxpayer is eligible for an Offer in Compromise (OIC).  If the taxpayer is eligible for an OIC they must still complete and submit a Form 656 and a Collection Information Statement.  The tool brings the user (the practitioner or the taxpayer) through six steps:

1.    Status: This step contains questions to determine the taxpayer’s eligibility for an OIC.

2.    Basic info: This step contains questions regarding the taxpayer’s location and their tax debt.

3.    Assets: This step contains questions regarding the taxpayer’s assets (FMV and any encumbrances).

4.    Income: This step contains questions regarding gross wages, net business and rental income, and other sources of income.

5.    Expenses: This step requests information regarding the taxpayer’s necessary living expenses. The tool will consider the local allowable expense criteria for the taxpayer.

6.    Proposal: In this step the tool will suggest a starting point for the offer amount representing the sum of asset equity and present value of future income.

The taxpayer or their authorized representative should use the results from the OIC Pre-Qualifier to complete the required forms in the OIC booklet.  If the suggested amount cannot be offered, a lower amount could be justified if the taxpayer has qualifying exceptional circumstances (Section 3 of Form 656).

Filing FBARs Electronically

Filing FBARs Electronically
...on behalf of my clients, here are five items that will be useful to know:
1.  An IRS Form 2848 will suffice to provide "documented authority" to e-file the FBAR.
2.  FinCEN is in the process of creating its own power of attorney form (though we've strongly suggested that continued use of the already common Form 2848 would be highly desirable given that so many individuals turn to their enrolled agents and other tax pros to file the FBAR.)
3.  If an attorney, CPA or EA files on behalf of his client, they are expected to retain (for five years) proof of your authority to do so. This proof may be maintained in electronic format.
4. FinCEN Form 114 supersedes TD F 90-22.1 (the FBAR form that was used in prior years) and is only available online through the BSA E-Filing System website. Report of Foreign Bank and Financial Accounts (FBAR) :: FinCen

5. File Form 8938 if max value of account exceeds $50,000 at any point during the year. Must use US Treasury FMS website Treasury Reporting Rates of Exchange to calculate foreign currency exchange rate.

Can an attorney, CPA or EA submit an FBAR via the BSA E-Filing System on behalf of a client?
Yes.  An attorney, CPA or EA may always assist his client in the preparation of electronic BSA forms for BSA E-Filing, including the FBAR. Consistent with FinCEN's recent proposal to provide for approved third-party filing of the FBAR, if an attorney, CPA or EA has been provided documented authority by the legally obligated filers to sign and submit FBARs on their behalf through the BSA E-Filing System, that attorney, CPA or EA can do so through a single BSA E-Filing account established for the attorney, CPA or EA. If such authority is not provided, the filings must be signed and submitted through a BSA E-Filing account unique to each client.

IRS Releases New Tax Tables and Remaining Inflation Adjusted Amounts for 2013

IRS Releases New Tax Tables and Remaining Inflation Adjusted Amounts for 2013
Now that the American Taxpayer Relief Act (Pub. L. 112-240) has been signed into law, the IRS has released the remaining 2013 inflation-adjusted numbers, including the 2013 tax rates. Rev. Proc. 2013-15.

Last October, the IRS issued inflation adjusted numbers for 2013. However, because of the uncertainty about the fiscal cliff and 2013 tax rates, the IRS withheld releasing some of those numbers. Now the IRS has released Rev. Proc. 2013-15, which provides the remaining 2013 inflation-adjusted numbers, including the 2013 tax rates. In addition, a change was made for 2012 relating to the amount excludable from income for the qualified transportation fringe benefit.

2013 Tax Rates

All 2013 tax rate tables for individuals, estates, and trusts reflect the new 39.6% maximum rate, which begins at the following levels of taxable income:

MFJ or Surviving Spouse	$450,000
Head of Household	$425,000
Unmarried Individual	$400,000
Married Filing Separately	$225,000
Estate or Trust	$11,950

Adoption Credit
For tax years beginning in 2013, the credit allowed for an adoption of a child with special needs is $12,970. For tax years beginning in 2013, the maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $12,970. The available adoption credit begins to phase out for taxpayers with modified adjusted gross income in excess of $194,580 and is completely phased out for taxpayers with modified adjusted gross income of $234,580 or more.

Child Tax Credit
For tax years beginning in 2013, the value used to determine the amount of the child tax credit that may be refundable is $3,000.

Earned Income Credit
For tax years beginning in 2013, the maximum earned income credit amounts are as follows:

No Qualifying Children	$487
One Qualifying Children	$3,250
Two Qualifying Children	$5,372
Three or more Qualifying Children	$6,044

The earned income tax credit is not allowed in 2013 if the aggregate amount of certain investment income exceeds $3,300.

American Opportunity (modified Hope) Credit
For tax years beginning in 2013, the American Opportunity (modified Hope) Credit is an amount equal to 100 percent of qualified tuition and related expenses not in excess of $2,000 plus 25 percent of those expenses in excess of $2,000, but not in excess of $4,000. Accordingly, the maximum American Opportunity (modified  Hope) Credit in tax years beginning in 2013 is $2,500.

A taxpayer's modified adjusted gross income in excess of $80,000 ($160,000 for a joint return) is used to determine the reduction in the amount of the American Opportunity (modified Hope) Credit otherwise allowable. 

Lifetime Learning Credit
The Lifetime Learning Credit is a tax credit for any person who takes college classes. It provides a tax credit of 20% of tuition expenses, with a maximum of $2,000 in tax credits on the first $10,000 of college tuition expenses. You can claim the Lifetime Learning Credit on your tax return if you, your spouse, or your dependents are enrolled at an eligible educational institution and you were responsible for paying college expenses. Unlike the American Opportunity credit, you need not be in the first four years of undergraduate classes. Even if you took only one class, you may take advantage of the Lifetime Learning Credit.

A taxpayer's modified adjusted gross income in excess of $53,000 ($107,000 for a joint return) is used to determine the reduction in the amount of the Lifetime Learning Credit otherwise allowable.

Exemption Amounts for Alternative Minimum Tax
For tax years beginning in 2013, the AMT exemption amounts are:

MFJ or Surviving Spouse	$80,800
Head of Household	$51,900
Unmarried Individual	$51,900
Married Filing Separately	$40,400
Estate or Trust	$23,100

The excess taxable income above which the 28 percent tax rate applies is $89,750 for married individuals filing separate returns and $179,500 for joint returns, unmarried individuals (other than surviving spouses), and estates and trusts.

The amounts used under Code Sec. 55(d)(3) to determine the phaseout of the AMT exemption amounts begins at the following AGI levels: 

MFJ and surviving spouse	$153,900
Single individual	$115,400
Head of Household	$115,400
MFS, estates, and trusts	$76,950

ATRA permanently retains the 0% and 15% tax rates on qualified dividends and long-term capital gains, and adds a new 20% tax rate that would apply to taxpayers who fall within the new 39.6% tax bracket. Which capital gains tax rate will apply depends on what tax bracket a person is in. The new capital gains tax rates for 2013 and future years will be

Tax Bracket	Capital Gains Rate
10% and 15%	-0-%
25%, 28%, 33% or 35%	15%
39.6%	20%
Net Investment income:  MfJ                > $250K Unmarried     > $200K MfS               > $125K Additional Medicare Tax Wages & S/E income: MfJ                > $250K Unmarried     > $200K MfS               > $125K (withheld by employer)	3.8%  Medicare surtax 0.9% Medicare surtax

Standard Deduction
For tax years beginning in 2013, the standard deduction amounts are as follows:

MFJ or Surviving Spouse	$12,200
Head of Household	$8,950
Unmarried Individual	$6,100
Married Filing Separately	$6,100

The standard deduction amount for an individual who may be claimed as a dependent by another taxpayer cannot exceed the greater of $1,000, or the sum of $350 and the individual's earned income.

The additional standard deduction amount for the aged or the blind is $1,200. The additional standard deduction amount is increased to $1,500 if the individual is also unmarried and not a surviving spouse.
For tax years beginning in 2013, the applicable amounts that are used to determine the AGI phaseout of the deductions are:

MFJ or Surviving Spouse	$300,000
Head of Household	$275,000
Unmarried Individual	$250,000
Married Filing Separately	$150,000

Qualified Transportation Fringe Benefit
For tax years beginning in 2013, the monthly limitation regarding the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass is $245. The monthly limitation regarding the fringe benefit exclusion amount for qualified parking is also $245.

For tax years beginning in 2012, the monthly limitation regarding the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass is $240. The monthly limitation regarding the fringe benefit exclusion amount for qualified parking is also $240 for 2012.

Adoption Assistance Programs
For tax years beginning in 2013, the amount that can be excluded from an employee's gross income for the adoption of a child with special needs is $12,970. For tax years beginning in 2013, the maximum amount that can be excluded from an employee's gross income for the amounts paid or expenses incurred by an employer for qualified adoption expenses furnished pursuant to an adoption assistance program for other adoptions by the employee is $12,970. The amount excludable from an employee's gross income begins to phase out for taxpayers with modified adjusted gross income in excess of $194,580 and is completely phased out for taxpayers with modified adjusted gross income of $234,580 or more.

Personal Exemption Phaseout
For tax years beginning in 2013, the personal exemption amount is $3,900. The AGI phaseout ranges for personal exemptions are as follows:

MFJ or Surviving Spouse	$300,000  to  $422,500
Head of Household	$275,000  to  $397,500
Unmarried Individual	$250,000  to  $372,500
Married Filing Separately	$150,000  to  $211,250

Interest on Education Loans
For tax years beginning in 2013, the $2,500 maximum deduction for interest paid on qualified education loans begins to phase out for taxpayers with modified adjusted gross income in excess of $60,000 ($125,000 for joint returns), and is completely phased out for taxpayers with modified adjusted gross income of $75,000 or more ($155,000 or more for joint returns).

Unified Credit Against Estate Tax
For an estate of any decedent dying during calendar year 2013, the basic exclusion amount is $5,250,000 for determining the amount of the unified credit against estate tax under IRC §2010.

Courtesy:  Parker's Federal Tax Bulletin: January 19, 2013 - Staff Editor at Parker Tax Publishing parkertaxpublishing.com

*CIRCULAR 230 DISCLOSURE: Pursuant to Regulations Governing Practice Before the Internal Revenue Service, any tax advice contained herein is not intended or written to be used and cannot be used by a taxpayer for the purpose of avoiding tax penalties that may be imposed on the taxpayer. 

FBAR News

FBAR News
With the upcoming June 30th deadline to file 2013 FBAR forms for US Taxpayers with foreign accounts over $10,000 and so much News regarding FBAR's, it's a good time to review the FBAR requirement as well as the news relating to the IRS' Enforcement Efforts regarding FBAR's and Offshore Voluntary Disclosures, including:

1. Report of Foreign Bank and Financial Accounts (FBAR)
2. New Reporting Requirements by U.S. Taxpayers Holding Foreign Financial Assets (Form 8938)
3. Offshore Voluntary Disclosure Program 

1.  Report of Foreign Bank and Financial Accounts (FBAR) 
If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, the Bank Secrecy Act may require you to report the account yearly to the Internal Revenue Service by filing Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR).

• Who Must File an FBAR (Form TD F 90-22.1)

United States persons are required to file an FBAR (Form TD F 90-22.1) if:

1. The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
2. The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.

United States person means United States citizens; United States residents; entities, including but not limited to, corporations, partnerships, or limited liability companies created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.

Look to the form’s instructions to determine eligibility for an exception and to review exception requirements.

• Reporting and Filing Information 

A person who holds a foreign financial account may have a reporting obligation even though the account produces no taxable income. Checking the appropriate block on FBAR-related federal tax return or information return questions (for example, on Schedule B of Form 1040, the "Other Information" section of Form 1041, Schedule B of Form 1065, and Schedule N of Form 1120) and filing the FBAR, satisfies the account holder's reporting obligation.

The FBAR is not filed with the filer's federal income tax return. The granting, by the IRS, of an extension to file federal income tax returns does not extend the due date for filing an FBAR. You may not request an extension for filing the FBAR. The FBAR is an annual report and must be received by the Department of the Treasury in Detroit, MI, on or before June 30th of the year following the calendar year being reported. While FinCEN strongly encourages individuals to electronically file FBARs, the form can be mailed to one of the two addresses below, provided that the mailing is received by June 30, 2013:

File by mailing the FBAR (Form TD F 90-22.1) to:
United States Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621

If an express delivery service is required for a timely filed FBAR, address the parcel to:
IRS Enterprise Computing Center
ATTN: CTR Operations Mailroom, 4th Floor
985 Michigan Avenue
Detroit, MI 48226

Delivery messenger service contact telephone number: (313) 234-1062. 
Account holders who do not comply with the FBAR reporting requirements may be subject to civil penalties, criminal penalties, or both.

• Electronic Filing for FBAR Forms – MANDATORY Beginning July 1, 2013

On June 29, 2011, FinCEN announced that all FinCEN forms must be filed electronically with certain exceptions. The FBAR was granted a general exemption from mandatory electronic filing through June 30, 2013. E-filing is a quick and secure way for individuals to file FBARs (Form TD F 90-22.1). Filers will receive an acknowledgement of each submission. For more information about FBAR e-filing, read the FinCEN news release.  FinCEN BSA E-filing System.  

The FBAR filing requirements, authorized under the Bank Secrecy Act, have been in place since 1972. The FBAR form is used to report a financial interest in, or signature or other authority over, one or more financial accounts in foreign countries. No report is required for a year if the accounts’ aggregate value does not exceed $10,000 at any time during that year.

2. New Reporting Requirements by U.S. Taxpayers Holding Foreign Financial Assets (Form 8938)
Taxpayers with specified foreign financial assets that exceed certain thresholds must report those assets to the IRS on Form 8938, Statement of Specified Foreign Financial Assets. File Form 8938 if max value of account exceeds $50,000 at any point during the year. Must use US Treasury FMS website Treasury Reporting Rates of Exchange to calculate foreign currency exchange rate.

The new Form 8938 filing requirement does not replace or otherwise affect a taxpayers requirement to file FBAR. A chart providing a comparison of Form 8938 and FBAR requirements, and other information to help taxpayers determine if they are required to file Form 8938, may be accessed from the IRS Foreign Account Tax Compliance Act Web page.

3. Offshore Voluntary Disclosure Program
On Jan 9, 2012, the IRS reopened the Offshore Voluntary Disclosure Program following continued interest from taxpayers and tax practitioners after the closure of the 2011 and 2009 programs. This program will be open for an indefinite period until otherwise announced.

Source: IRS

5 Steps to Delegating & Supervising

5 Steps to Delegating & Supervising
There are 5 steps to delegating and supervising that guarantee that your expectations are met and success results are achieved.

Step One
The first step in delegation is to become perfectly clear about the results that you desire from the job. The greater clarity you have with regard to the results expected, the easier it is for you to select the right person to do the job.

Step Two
The second step is to select a person based on his or her demonstrated ability or success at doing this job. Never delegate an important job to a person who has never done it before. If the successful completion of the task is important to the success of your business, it is essential that you delegate it to someone who you confidently believe can complete the task satisfactorily.

Step Three
Third, explain to the person exactly what you want done, the results that you expect, the time schedule that you require, and your preferred method of working. The reason that you are in a position to delegate a task is because you have probably already mastered this task. Taking the time to teach and explain the best way to do the task based on your experience is an excellent way to ensure that the task will be done as you wish and on schedule.

Step Four
Step four is to set up a schedule for reporting on progress. If it is an important task, set up a deadline for completion that is a day or a week before your actual deadline. Always build some slack into the system. Then, check on the progress of the task regularly, very much like a doctor would check on the condition of a critical care patient. Leave nothing to chance.

Step Five
Step five, inspect what you expect. Delegation is not abdication. Just because you have assigned a task to another person does not mean that you are no longer accountable. And the more important the task, the more important it is that you keep on top of it.

What task can you effectively delegate to someone else? Which one of your employees can handle the task efficiently?

Courtesy: Brian Tracy, Best-Selling Author, Speaker and Success Coach

List of Basic Items for Executor to Obtain

List of Basic Items for Executor to Obtain
The following is a basic list of items for the executor to obtain to enable the practitioner to prepare the estate tax return.  Depending on the size of the estate and other factors, other items may be necessary:

	1.  Last Will & Testament.
	2.  Inventory of  personal effects.
	3.  List of all bank accounts, including savings accounts.
	4.  List of investments.
	5.  List of pension funds.
	6.  Copies of life insurance policies.
	7.  Legal description of all real estate, copies of deeds, promissory notes and deeds of trust.
	8.  Legal description of mineral interests and amount of any income being received from such interests.
	9.  Legal description of property located in other counties or states.
	10.  Gift tax returns and list of lifetime gifts by the decedent.
	11.  Copies of all trust agreements where the decedent was a grantor, trustee or beneficiary.
	12.  Copies of income tax returns for at least the last three years.
	13.  Schedule K-1s from partnerships and S corporations for at least the last three years.
	14.  Copy of homeowner’s insurance.
	15.  List of all administration expenses including funeral expenses.
	16.  Names, addresses, ages, relationship and social security number of all beneficiaries.
*****	17.  Names and addresses of all professional advisors of decedent.

Source:  Practitioners Publishing House, Fort Worth, TX