Funny Tax Quotes

“Income tax has made more liars out of the American people than golf.”

-Will Rogers

 

“The hardest thing in the world to understand is the income tax.”

-Albert Einstein

 

“Today it takes more brains and effort to make out the income tax form that it does to make the income.”

-Alfred E. Neuman

 

“Did you ever notice that when you put the words, “The” and “IRS” together, it spells “THEIRS?”

-Anonymous

 

“People who complain about taxes can be divided into two classes:  men and women.”

-Unknown

 

“Few of us ever test our powers of deduction, except when filing out an income tax return.”

-Laurence J. Peter, author

 

“Some taxpayers close their eyes, some stop their ears, some shut their mouths, but all pay through the nose”

-Evan Esar

Teller at Check-Cashing Business Gets Bounced by the IRS

Krystal Proctor, a former teller at a check-cashing business, was indicted by a grand jury in the District of Maryland with theft of public money and conspiring to defraud the United States.

It’s alleged that from 2011 through 2013, Proctor and unnamed co-conspirators filed false tax returns with the IRS using stolen IDs. Refund checks were taken to Proctor, who then entered false information into the check cashing business’s database.  Proctor processed the stolen checks under the names of existing customers instead of the individuals named on the checks.

According to the indictment, Proctor cashed over 100 checks totaling more than $500,000.

If convicted, Proctor faces a maximum sentence of five years in prison for conspiracy and 10 years for each count of theft of public money.  She will also have to pay restitution and penalties.

A trial date is pending.

Health Care Company Owner Convicted for Tax Evasion

Las Vegas resident Maria Larkin, was convicted of tax evasion after a jury found her guilty of refusing to pay employment taxes to the IRS for money she withheld from her employees.

Larkin operated the Five Star Home Health Care, Inc. from 1996 until 2009.  From 2004 to 2009, evidence showed that not only did she fail to pay the employment taxes, she also tried to conceal her income and assets by lying about her ability to pay.  She changed the name of her business and instructed her employees to cash checks for her.  She also bought a home in the name of a nominee.  Larkin faces up to 5 years in prison at her sentencing later this year.

 

Owner of Pegasus Home Corporation Gets His Wings Clipped by the IRS

David J. Simard, of Maryland, pled guilty in the U.S. District Court of one count of obstructing the lawful functions of the Internal Revenue Service and four counts of failing to file personal and corporate income tax returns.

Simard, a real estate flipper, received a notice from the IRS that he needed to supply documents in connection with an audit of his personal tax returns.  In less than one month after receiving this notice, Simard formed the Pegasus Home Corporation and starting buying and selling houses in the name of the corporation instead of his own.  Simard claimed that the ownership and control of Pegasus was his relative and had this relative apply for an employer identification number for Pegasus. Simard also had this relative open a bank account in the name of the Pegasus Corporation. Despite earning income, Simard did not file personal or corporate tax returns for 2009 and 2010.

Simard will be sentenced on October 12th and faces a maximum of three years in prison for obstructing the IRS and one year in prison for each count of failure to file tax return, as well as restitution and monetary penalties.

6 Tax Tips For Startups

 

  1. Pick a business structure.  One of the first things a startup will need is to decide how they are going to structure their business – as a sole proprietorship, a partnership, an S or C Corp, and so on.  Each comes with different tax rules and different filing requirements, so the advice of an expert will be invaluable.
  2. Pick a tax year.  How and when a business files its taxes is determined by its tax year, which can either match the calendar year or be a fiscal year of any 12 consecutive months.  In most cases, the business owner can choose whichever works best for them – but calendar years are required for business with no books or records, no annual accounting period or in certain circumstances laid out in the IRC.
  3. Know your business taxes.  Besides income tax, a business may be subject to self-employment tax, employment tax and/or excise tax, depending in large part on the business structure it chooses.  Furthermore, they may also need to make estimated tax payments on a quarterly basis.
  4. Pick an accounting method.  Depending on the type of business and the owner, they will need to determine which set of rules to use for reporting income and expenses, which the IRS expects them to use consistently.  The most two common methods are cash method (where taxpayers report income and deduct expenses in the year they occur) and accrual method (where they report and deduct in the year income and expenses are earned or incurred, even if they get the income or pay the expenses in a later year).
  5. Keep good records.  Right from the beginning, the business owner needs to keep good records and books to identify income; track deductible expenses; track their basis  in property; substantiate purchases, sales, payroll and other transactions; and make the job of their tax preparers and accountants easier.  Starting with good record-keeping practices will save time later.
  6. Sign up for an EIN.  Most business will need to apply for an Employer Identification Number, or Federal Tax ID Number, to identify themselves as a business entity in their interactions with the government.

Celebrity Tax Lien – Floyd Mayweather

The IRS still has Floyd Mayweather Jr. on the hook for $7.2 million in taxes from 2010, according to records that show a Federal Tax Lien filing.

That’s on top of the $22.2 million the undefeated boxer nicknamed “Money” owes in 2015 taxes for the year he earned $200 million to fight Manny Pacquiao.

Mayweather’s public bravado about his wealth doesn’t match up with county records in Las Vegas and his own petition to the U.S. Tax Court in Washington.

A petition filed by Mayweather last week argues that as wealthy as he is, he doesn’t have the cash on hand to pay his debt for 2015. The IRS refused a direct request by the fighter to pay in installments until he is paid for the McGregor fight, and the agency said it intends to levy Mayweather.

IRS Releases Eight Tips to Protect Taxpayers from Identity Theft

Identity theft happens when someone steals personal information for financial gain. Tax-related identity theft happens when someone uses another person’s stolen Social Security number (SSN) or Employer Identification Number (EIN) to file a tax return to obtain a fraudulent refund.

Many people first find out they are victims of identity theft when they submit their tax returns. That’s because the IRS lets them know someone else already used their SSN to file.

The IRS continues to work hard to stop identity theft with a strategy of prevention, detection and victim assistance. So far, the agency has stopped millions of dollars from getting into the hands of thieves.

Check out these eight tips on how to protect against identity theft:

1. Taxes. Security. Together. The IRS, the states and the tax industry need everyone’s help. The IRS launched The Taxes. Security. Together. awareness campaign in 2015 to inform people about ways to protect their personal, tax and financial data. Learn more at www.IRS.gov/TaxesSecurityTogether.

2. Protect Personal and Financial Records. Taxpayers should not carry their Social Security card in their wallet or purse. They should only provide their Social Security number if it’s necessary. Protect personal information at home and protect personal computers with anti-spam and anti-virus software. Routinely change passwords for online accounts.

3. Don’t Fall for Scams.  Criminals often try to impersonate banks, credit card companies and even the IRS hoping to steal personal data. Learn to recognize and avoid those fake communications. Also, the IRS will not call a taxpayer threatening a lawsuit, arrest or to demand immediate payment. Beware of threatening phone calls from someone claiming to be from the IRS.

4. Report Tax-Related ID Theft. Here’s what taxpayers should do if they cannot e-file their return because someone already filed using their SSN:

  • File a tax return by paper and pay any taxes owed.
  • File an IRS Form 14039, Identity Theft Affidavit. Print the form and mail or fax it according to the instructions. Include it with the paper tax return and/or attach a police report describing the theft if available.
  • File a report with the Federal Trade Commission using the FTC Complaint Assistant.
  • Contact Social Security Administration at www.ssa.gov and type in “identity theft” in the search box.
  • Contact financial institutions to report the alleged identity theft.
  • Contact one of the three credit bureaus so they can place a fraud alert or credit freeze on the affected account.
  • Check with the applicable state tax agency to see if there are additional steps to take at the state level.

5. IRS Letters. If the IRS identifies a suspicious tax return with a taxpayer’s stolen SSN, that taxpayer may receive a letter asking them verify their identity by calling a special number or visiting an IRS Taxpayer Assistance Center.

6. IP PIN. If a taxpayer is a confirmed ID theft victim, the IRS may issue them an IP PIN. The IP PIN is a unique six-digit number that the taxpayer uses to e-file their tax return. Each year, they will receive an IRS letter with a new IP PIN.

7. Report Suspicious Activity. If taxpayers suspect or know of an individual or business that is committing tax fraud, they can visit IRS.gov and follow the chart on How to Report Suspected Tax Fraud Activity.

8. Service Options. Information about tax-related identity theft is available online. The IRS has a special section on IRS.gov devoted to identity theft and information for victims to obtain assistance.

Your IRS Questions Answered Here…

Question: I was self-employed and haven’t been able to pay my taxes for 3 years.  Now I’m a W-2 employee but I’m getting letters from the IRS demanding payment and threatening to garnish my paycheck. What should I do?

Answer:  The IRS doesn’t like being ignored and they want you to know they won’t go away. They have a lot of power over your life. They have 10 years to collect from the date you filed your return. Not only can they freeze your bank accounts and take the money, but they can garnish your wages and legally take as much as 75% of your net paycheck. The IRS can and will slap a lien on your house and other property as well. If you sell your house the IRS gets their money first before you do. Federal Tax Liens will damage your credit, making it harder to rent an apartment, get a car, obtain credit, and even get a job.  The IRS can even show up at your door!  Interest and penalties continue to accrue on a daily basis. You need professional expert help to deal with the IRS!  You can’t do this on your own. We offer immediate relief by protecting you from the long arm of the IRS. This is what we do on a daily basis.

Even Stolen Funds Need to be Reported as Income

James Miller, of Manhattan Beach, CA, was convicted Jun 12th of wire fraud and filing false tax returns.

Miller was the president of an internet sales company, and from 2009 to 2012 embezzled more than $300,000 from the company to pay for personal expenses but did not report it on his personal tax returns, causing a loss to the IRS of approx. $58,000.  He faces a sentence of 20 years for wire fraud and 3 years in prison for each count of filing a false tax return.

More Fun Tax Facts

-When Roosevelt raised the top tax rate to 79% for people making more than $5 million in 1935, the only person it applied to was John D. Rockefeller.

-A cult leader deeded 600 acres of land to “God” in 1864, but the State of Pennsylvania took back the land because “God” didn’t pay his property taxes.

-The US has a law that importing toys resembling humans are taxed higher than those who don’t.  Marvel Toys went to court and argued that X-Men action figures should be taxed lower because they are actually mutants.  The court agreed with Marvel.

-The citizens in the town of Ulysses, Kansas moved their whole city, including all the buildings in 1909 because of exorbitant property taxes.

-The US Tax Code is four times longer than the complete works of Shakespeare.

-In South Carolina, couples who sit through a minimum of six hours with a licensed pre-marriage professional or clergy training in premarital preparation can take a $50 tax credit if they file jointly once they are married.