Gideon Misulovin, a former New York business man on trial for tax evasion and fraud in 1996, appeared in US federal court on July 17, 2015 for the first time in 19 years.
Making money from your favorite hobby, such as stamp or coin collecting, craft making, or horse breeding? Any income earned from a hobby activity must be reported on your annual federal income tax return, however, the way hobby income is reported is different than reporting business income and there are particular rules and limits for deductions. Five basic tips to know if your hobby produces income:
On Tuesday, July 15, 2015, National Taxpayer Advocate Nina E. Olson released her mid-year report to Congress. The report identifies the priority issues the Tax Payer Advocate Service ("TAS") will address during the upcoming fiscal year. In addition to recapping the 2015 filing season, the report discusses the IRS's long-term strategic planning, tax-related identity theft, and the administration of the Patient Protection and Affordable Care Act. Nine other areas of focus are included in the report, including the TAS's efforts to improve its advocacy for and service to taxpayers, pending TAS research initiatives, and an update on the TAS's efforts to implement an integrated technology system. Volume 2 of the report contains the IRS's responses to the administrative recommendations the National Taxpayer Advocate made in her 2014 Annual Report to Congress, along with additional TAS comments.
Last week, Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, Assistant Director in Charge New York Field Office of the Federal Bureau of Investigation ("FBI"), and Timothy P. Camus, Deputy Inspector General for Investigations of the United States Treasury Inspector General for Tax Administration ("TIGTA"), announced that SAHIL PATEL was sentenced to 175 months in prison and $1 million in forfeiture for his role in organizing the U.S. side of a massive fraud and extortion ring run through various "call centers" located in India. PATEL and his coconspirators impersonated American law enforcement officials and threatened victims with arrest and financial penalties unless those victims made payments to avoid purported charges.
In the past two weeks, three Swiss banks--Bank Linth LLB AG (Bank Linth), Bank Sparhafen Zurich AG (BSZ), and Ersparniskasse Schaffhausen AG (EKS)-have reached resolutions under the Department of Justice's Swiss Bank Program. The Swiss Bank Program, which was announced on Aug. 29, 2013, provides a path for Swiss banks to resolve potential criminal liabilities in the United States. Swiss banks eligible to enter the program were required to advise the department by Dec. 31, 2013, that they had reason to believe that they had committed tax-related criminal offenses in connection with undeclared U.S.-related accounts. Banks already under criminal investigation related to their Swiss-banking activities and all individuals were expressly excluded from the program.
For those with one or more bank of financial accounts located outside the United States, or those who have signature authority over such accounts, Report 114, Report of Foreign Bank and Financial Accounts is due Tuesday, June 30, 2015. For more information, see the IRS website here.
On June 3, 2015, the California Labor Commissioner found an Uber driver to be an employee, and thus eligible for reimbursement for mileage and other expenses while providing rides for the tech company, which claims to be engaged in the business of providing lead generation to transportation providers using its mobile application. (Berwick v. Uber Technologies, Inc., Labor Commissioner Case No.: 11-46739 EK http://cdn.arstechnica.net/wp-content/uploads/2015/06/04954780-Page0-20.pdf) Uber Technologies Inc. is appealing the decision in the Superior Court of California, County of San Francisco. This case coincides with recent federal court wage and hour claims, in which Uber and a similar provider, Lyft, are defending claims that the transportation providers are employees and misclassified as independent contractors. (O'Connor v. Uber Technologies, Inc., No. 3:13-cv-03826-EMC (N.D. Cal. Mar. 11, 2015); Cotter v. Lyft, Inc., No. 3:13-cv-04065-VC (N.D. Cal. Mar. 11, 2015))
In a recent edition of TaxTips, the IRS reminds taxpayers of pending deadlines related to foreign income and assets.
On June 9, 2015, the Department of Justice Tax Division announced it had reached resolution with two more banks in its Swiss Bank Program. Société Générale Private Banking will pay a $17.807 million penalty and Berner Kantonalbank AG will pay a $4.619 million penalty and both continue to cooperate with the Department of Justice. The Swiss Bank Program, which was announced on Aug. 29, 2013, provides a path for Swiss banks to resolve potential criminal liabilities in the United States where officers, employees, and others facilitated the concealment of foreign accounts belonging to US Taxpayers, leading to the evasion of their U.S. tax obligations. Click here for the Department of Justice's full press release http://www.justice.gov/opa/pr/two-more-banks-reach-resolutions-under-justice-departments-swiss-bank-program-0
With graduations in full swing and high school seniors preparing to leave home for college, employment, or other adventures, it may be time to consider estate planning documents for your 18 year old. It may not initially make sense for an 18 year old to need an estate plan since most do not have significant assets. However, in most states, an 18 year old is an adult, with legal rights relating to privacy and decision making. As soon as a child turns 18, parents will lose authority to view medical and financial records related to the child, as well as be prevented from making decisions on their child's behalf.