It will be a Concrete Jungle for Paving Company Owner

Douglas Wieland of Denver, CO, was sentenced to 12 months and one day in prison after pleading guilty to two counts of failure to pay income taxes.

Wieland was the owner of Performance Paving, a company that performed concrete and asphalt work.  According to court documents, it was shown that from April 1999 through December 2017, Wieland did not make any payments toward his income taxes, and admitted that he took steps to conceal his income and hide his assets to prevent the IRS seizing them.  Wieland opened a “warehouse bank account”, in which there are numerous account holders on a single account where the funds get commingled to maintain financial privacy.  He deposited over $1.8 million to pay his personal expenses. Wieland also admitted in court that he would cash customer’s checks whenever possible.

In addition to jail time, Wieland was ordered to pay restitution to the IRS in the amount of $166,658.

Taxpayers who can’t pay their taxes should still file on time

With the April tax filing due date just a few days away, taxpayers should remember to both file and pay any taxes they owe by the deadine. Taxpayers who do not file and pay timely will see their tax debt grow. In fact, penalties and interest can cause a taxpayer’s debt to grow by more than thirty percent in just a few months.

Here are some tips for taxpayers who owe tax, but who can’t immediately pay their tax bill. Taxpayers should:

File their tax return or request an extension of time to file by the April deadline.
Taxpayers who owe tax and do not file their return on time or request an extension may face a failure-to-file penalty for not filing on time.
Pay as much as possible by the April due date.
Whether they are filing a return or requesting an extension, taxpayers must pay their bill in full by the April filing deadline. Taxpayers who do not pay their taxes on time will face a failure-to-pay penalty. Taxpayers should remember that an extension of time to file is not an extension of time to pay.
Set up a payment plan as soon as possible.
Taxpayers who owe, but cannot pay in full by the deadline don’t have to wait for a tax bill to request a payment plan. Taxpayers can apply for a payment plan on IRS.gov. Taxpayers can also submit a payment plan request in writing using Form 9465, Installment Agreement Request.

#IRSTaxTip

Source: https://go.usa.gov/xmx62

Accountant Steals NBA Client’s Identity and Gets Slam Dunked by the IRS

Randy Usow, an accountant from Mequon, WI,, was sentenced to 30 months in prison after defrauding the IRS by using his client’s identity to file bogus tax returns.

Usow used former Milwaukee Bucks center Zaza Pachulia’s personal information to file false tax returns that generated inflated refunds, much of which Usow pocketed by opening a bank account in Pachulia’s name without the player’s knowledge.

In a refund filed for 2014, Usow’s false return netted him a $463,867 refund.  The tax return given to Pachulia for review showed a refund of approximately $164,000.  Usow opened another bank account under the name of US Government LLC, where he transferred the large refund and then wired Pachulia the amount he was expecting to make it look as though the refund came from the IRS.

Prosecutors recommended the federal sentencing guideline of 54 to 61 months, but due to a plea deal, urged the judge to issue a prison term of three years.  U.S. District Judge Pamela Pepper gave the reduced sentenced and credited Usow for his generally good character and support of his family and friends.  But she also noted that unlike most tax refund fraud cases she sees, involving poorly trained people getting poor people to let them do their returns, Usow has post-graduate training and no real need for the money he stole.  “You were someone everybody had the right to put their confidence in”, she said.  Judge Pepper said Usow didn’t have to report to prison until after April 30th — so he could have time to finish tax returns for his remaining clients!

Individuals who need passports for imminent travel should contact IRS promptly to resolve tax debt

According to the IRS:

WASHINGTON ― The Internal Revenue Service today reiterated its warning that taxpayers may not be able to renew a current passport or obtain a new passport if they owe federal taxes. To avoid delays in travel plans, taxpayers need to take prompt action to resolve their tax issues.

In January of last year, the IRS began implementing new procedures affecting individuals with “seriously delinquent tax debts.” These new procedures implement provisions of the Fixing America’s Surface Transportation (FAST) Act. The law requires the IRS to notify the State Department of taxpayers the IRS has certified as owing a seriously delinquent tax debt, which is $52,000 or more. The law also requires State to deny their passport application or renewal. If a taxpayer currently has a valid passport, the State Department may revoke the passport or limit ability to travel outside the United States.

When the IRS certifies a taxpayer to the State Department as owing a seriously delinquent tax debt, they receive a Notice CP508C from the IRS. The notice explains what steps a taxpayer needs to take to resolve the debt. Please note, the IRS doesn’t send copies of the notice to powers of attorney. IRS telephone assistors can help taxpayers resolve the debt, for example, they can help taxpayers set up a payment plan or make them aware of other payment alternatives. Taxpayers shouldn’t delay because some resolutions take longer than others, such as adjusting a prior tax assessment.

When a taxpayer no longer has a seriously delinquent tax debt, because they paid it in full or made another payment arrangement, the IRS will reverse the taxpayer’s certification within thirty days. State will then remove the certification from the taxpayer’s record, so their passport won’t be at risk under this program. The IRS can expedite the decertification notice to the State Department for a taxpayer who resolves their debt, has a pending passport application and has imminent travel plans or lives abroad with an urgent need for a passport.

A taxpayer with a seriously delinquent tax debt is generally someone who owes the IRS more than $52,000 in back taxes, penalties and interest for which the IRS has filed a Notice of Federal Tax Lien and the period to challenge it has expired or the IRS has issued a levy.

Before denying a passport renewal or new passport application, the State Department will hold the taxpayer’s application for 90 days to allow them to:

Resolve any erroneous certification issues,
Make full payment of the tax debt, or
Enter a satisfactory payment arrangement with the IRS.
Ways to Resolve Tax Issues
There are several ways taxpayers can avoid having the IRS notify the State Department of their seriously delinquent tax debt. They include the following:

Paying the tax debt in full,
Paying the tax debt timely under an approved installment agreement,
Paying the tax debt timely under an accepted offer in compromise,
Paying the tax debt timely under the terms of a settlement agreement with the Department of Justice,
Having requested or have a pending collection due process appeal with a levy, or
Having collection suspended because a taxpayer has made an innocent spouse election or requested innocent spouse relief.
Relief programs for unpaid taxes
Frequently, taxpayers qualify for one of several relief programs including the following:

Payment agreement. Taxpayers can ask for a payment plan with the IRS by filing Form 9465. Taxpayers can download this form from IRS.gov and mail it along with a tax return, bill or notice. Some taxpayers can use the online payment agreementto set up a monthly payment agreement.

Offer in compromise. Some taxpayers may qualify for an offer in compromise, an agreement between a taxpayer and the IRS that settles the tax liability for less than the full amount owed. The IRS looks at the taxpayer’s income and assets to decide the taxpayer’s ability to pay. Taxpayers can use the Offer in Compromise Pre-Qualifier tool to help them decide whether they’re eligible for an offer in compromise.
Subject to change, the IRS also will not certify a taxpayer as owing a seriously delinquent tax debt or will reverse the certification for a taxpayer:

Who is in bankruptcy,
Who is deceased,
Who is identified by the IRS as a victim of tax-related identity theft,
Whose account the IRS has determined is currently not collectible due to hardship,
Who is located within a federally declared disaster area,
Who has a request pending with the IRS for an installment agreement,
Who has a pending offer in compromise with the IRS, or
Who has an IRS accepted adjustment that will satisfy the debt in full.
For taxpayers serving in a combat zone who owe a seriously delinquent tax debt, the IRS postpones notifying the State Department of the delinquency and the taxpayer’s passport is not subject to denial during the time of service in a combat zone.

For more on these procedures and the law visit IRS.gov. The IRS first announced this matter in IRS news release IR-2018-7 on Jan. 16, 2018.

 

https://www.irs.gov/newsroom/individuals-who-need-passports-for-imminent-travel-should-contact-irs-promptly-to-resolve-tax-debt?inf_contact_key=1ebde80919088bd1769c48fb018d2746680f8914173f9191b1c0223e68310bb1

IRS warning: Don’t be a victim of ‘ghost’ tax return preparers

According to the IRS:

https://www.irs.gov/newsroom/irs-warning-dont-be-a-victim-of-ghost-tax-return-preparers?inf_contact_key=1c9a49e42c4b6e18d187fe8b99fe8cfc680f8914173f9191b1c0223e68310bb1

 

WASHINGTON ― The Internal Revenue Service is cautioning taxpayers to avoid the dangers of “ghost” tax return preparers.

According to the IRS, a ghost preparer is paid to prepare a tax return, but does not sign it, either electronically or on paper, as the paid preparer. These phantom preparers who won’t put their name on the tax return are a warning sign for taxpayers of a potential scam.

Here’s how it works. The ghost preparer can print the paper return for their client and tells them to sign and mail it to the IRS. Or, for electronically-filed returns, they will prepare it but won’t digitally sign it as the paid preparer. By doing so, the tax return appears to be self-prepared, with no indication that a paid tax preparer was used in completing the tax return — helping keep the return preparer under the radar.

By law, anyone who prepares or assists in preparing federal tax returns for compensation must have a valid 2018 Preparer Tax Identification Number, or PTIN, before preparing any tax return. Tax preparers should sign the tax returns they prepare on paper and include their PTIN on the tax return, which provides the IRS with their identifying information. A paid tax preparer who prepares more than 10 tax returns is also generally required to e-file those returns. In this case, the preparer would digitally sign the tax return.

For 2018, the IRS has issued more than 737,000 PTINs to tax preparers.

Dishonest and unscrupulous tax preparers, including some who are “ghost” tax preparers, perpetuate refund fraud and scams that hurt honest taxpayers who are simply trying to do the right thing and file a legitimate tax return. Dishonest preparers look to make a fast buck by promising a big refund, sometimes charging fees based on a percentage of the refund. These shady preparers may also:

Require payment in cash only and not provide a receipt.
Invent income to erroneously qualify their clients for tax credits or claim fake deductions to enable the taxpayer to get a larger refund.
Direct refunds into their own financial account rather than the taxpayer’s account.
The IRS urges taxpayers to review their tax return carefully and ask questions if something is not clear before they sign and file it with the IRS. They should ensure they are comfortable with the accuracy of their tax return. And for any direct deposit refund, taxpayers should make sure both the routing and bank account number on the completed tax return are correct.

Taxpayers can report abusive tax preparers to the IRS. Use Form 14157, Complaint: Tax Return Preparer. If a taxpayer suspects a tax preparer filed or changed their tax return without their consent, they should file Form 14157-A, Tax Return Preparer Fraud or Misconduct Affidavit.

To find a tax preparer, taxpayers can visit the IRS preparer directory at www.irs.gov/chooseataxpro. Remember: Taxpayers are legally responsible for what is on their tax return even if someone else prepares it.

 

Your IRS Questions Answered Here:

Question: I received a Notice of Federal Tax Lien via certified mail for unpaid back taxes and I’m scared and don’t know what to do.  Can you help?

Answer: Yes. A Notice of Federal Tax Lien (NFTL) is public record and is generally filed with the County Recorder where you reside.  A federal tax lien will also negatively impact your credit report scores.  It is notice to all your other creditors that the IRS has a secured interest in all your real and personal property you have now and acquired in the future.

A federal tax lien will make it very difficult, if not impossible, for you to purchase a home, vehicle and other property on credit.  It may also prevent you from accessing the equity in real property you may have built up over the years.  However, the IRS has several different solutions that can resolve your NFTL if you qualify.   You can resolve a federal tax lien by paying it in full or if that is not an option you can find out if you qualify for a “Release of Lien”, a “Lien Subordination”, a Lien Discharge” or “Lien Withdrawal”.  It is important to keep in mind that IRS problems didn’t just happen overnight and will take some time to resolve.  The good news is that generally you won’t have to meet or even speak with the IRS while we’re retained.   It’s important to consult with a tax resolution professional to see which Lien relief solutions you may be eligible for before the IRS starts enforcing aggressive collection action against you. We can help protect what you have and preserve your rights!!

IRS Fun Fact

Richard Nixon’s tax return showed an income of $200,000, and in 1970 paid $792.81 in federal income tax and $878.03 in 1971, with deductions of $571,000 for donating “vice-presidential papers.

IRS Dirty Dozen Scams

The Internal Revenue Service today wrapped up issuing its annual “Dirty Dozen” list of tax scams. The IRS reminds taxpayers to remain vigilant to these often aggressive and evolving schemes throughout the year.

Phishing: Taxpayers should be alert to potential fake emails or websites looking to steal personal information. The IRS will never initiate contact with taxpayers via email about a bill or tax refund. Don’t click on one claiming to be from the IRS. Be wary of emails and websites that may be nothing more than scams to steal personal information. (IR-2019-26)

Phone Scams: Phone calls from criminals impersonating IRS agents remain an ongoing threat to taxpayers. The IRS has seen a surge of these phone scams in recent years as con artists threaten taxpayers with police arrest, deportation and license revocation, among other things. (IR-2019-28)

Identity Theft: Taxpayers should be alert to tactics aimed at stealing their identities, not just during the tax filing season, but all year long. The IRS, working in conjunction with the Security Summit partnership of state tax agencies and the tax industry, has made major improvements in detecting tax return related identity theft during the last several years. But the agency reminds taxpayers that they can help in preventing this crime. The IRS continues to aggressively pursue criminals that file fraudulent tax returns using someone else’s Social Security number. (IR-2019-30)

Return Preparer Fraud: Be on the lookout for unscrupulous return preparers. The vast majority of tax professionals provide honest, high-quality service. There are some dishonest preparers who operate each filing season to scam clients, perpetuate refund fraud, identity theft and other scams that hurt taxpayers. (IR-2019-32)

Inflated Refund Claims: Taxpayers should take note of anyone promising inflated tax refunds. Those preparers who ask clients to sign a blank return, promise a big refund before looking at taxpayer records or charge fees based on a percentage of the refund are probably up to no good. To find victims, fraudsters may use flyers, phony storefronts or word of mouth via community groups where trust is high. (IR-2019-33)

Falsifying Income to Claim Credits: Con artists may convince unsuspecting taxpayers to invent income to erroneously qualify for tax credits, such as the Earned Income Tax Credit. Taxpayers should file the most accurate tax return possible because they are legally responsible for what is on their return. This scam can lead to taxpayers facing large bills to pay back taxes, interest and penalties. (IR-2019-35)

Falsely Padding Deductions on Returns: Taxpayers should avoid the temptation to falsely inflate deductions or expenses on their tax returns to pay less than what they owe or potentially receive larger refunds. Think twice before overstating deductions, such as charitable contributions and business expenses, or improperly claiming credits, such as the Earned Income Tax Credit or Child Tax Credit. (IR-2019-36)

Fake Charities: Groups masquerading as charitable organizations solicit donations from unsuspecting contributors. Be wary of charities with names similar to familiar or nationally-known organizations. Contributors should take a few extra minutes to ensure their hard-earned money goes to legitimate charities. IRS.gov has the tools taxpayers need to check out the status of charitable organizations. (IR-2019-39)

Excessive Claims for Business Credits: Avoid improperly claiming the fuel tax credit, a tax benefit generally not available to most taxpayers. The credit is usually limited to off-highway business use, including use in farming. Taxpayers should also avoid misuse of the research credit. Improper claims often involve failures to participate in or substantiate qualified research activities or satisfy the requirements related to qualified research expenses. (IR-2019-42)

Offshore Tax Avoidance: Successful enforcement actions against offshore cheating show it’s a bad bet to hide money and income offshore. People involved in offshore tax avoidance are best served by coming in voluntarily and getting caught up on their tax-filing responsibilities. (IR-2019-43)

Frivolous Tax Arguments: Frivolous tax arguments may be used to avoid paying tax. Promoters of frivolous schemes encourage taxpayers to make unreasonable and outlandish claims about the legality of paying taxes despite being repeatedly thrown out in court. The penalty for filing a frivolous tax return is $5,000. (IR-2019-45)

Abusive Tax Shelters: Abusive tax structures including trusts and syndicated conservation easements are sometimes used to avoid paying taxes. The IRS is committed to stopping complex tax avoidance schemes and the people who create and sell them. The vast majority of taxpayers pay their fair share, and everyone should be on the lookout for people peddling tax shelters that sound too good to be true. When in doubt, taxpayers should seek an independent opinion regarding complex products they are offered. (IR-2019-47)

Massachusetts Couple Could Face Long Prison Term

Gary DeCicco and Pamela Avedisian of Nahant, MA, were charged with multiple felonies, including two counts of tax evasion, one count of conspiracy to commit bank fraud, four counts of wire fraud and six counts of engaging in unlawful monetary transactions.

Between April 2012 and February 2013, DeCicco told the IRS that he did not have the ability to pay his more than $340,000 tax liability.  He repeatedly claimed he had very little cash, no vehicles or real properties during that time.

According to the IRS, he had ownership of several businesses, vehicles and real estate, titled to other entities to conceal his ownership from the IRS.

Originally, the IRS accepted a monthly installment plan based on false information.  During that time, DeCicco allegedly bought and sold numerous real properties, boats, luxury cars, concealing the sales with the help of Avedisian.

The couple could face up to 5 years in prison for each count of tax evasion, up to 30 years for wire fraud and conspiracy to commit bank fraud, and up to 20 years for unlawful monetary transactions consecutively, as well as supervised release and monetary fines and penalties.

Attorney and GOP Power Broker Has Champagne Taste but Claims a Beer Budget

George Gilmore, one of the most powerful figures for the GOP in New Jersey, was indicted in Jan. 2019 on six federal tax-related counts.

Gilmore, an attorney at the firm Gilmore & Monahan, which had $2 million in public contracts across the state in 2017, was charged with tax evasion, filing false tax returns, failing to collect, account for, and pay payroll taxes, and making false statements on a bank loan application. Gilmore is also chairman of the Orange County GOP and the county Board of Elections.

According to the indictment, while Gilmore owed the IRS more than $1.5 million in taxes, penalties and interest, rather than paying that debt he spent more than $2.5 million on personal expenses.  Between January 2014 and December 2016, Gilmore spent $380,000 to remodel his waterfront home in Toms River, including an infinity pool and cabana; $440,000 on antiques, artwork and collectables including animal tusks; $20,000 on a Steinway piano and $80,000 on model trains. In order to hide the personal expenses, Gilmore classified the payments as “shareholder loans.”  He did send one check to the IRS for $500,000 but that check bounced as there was less than $2,500 in the account.

Kevin Marino, Gilmore’s attorney said, “George Gilmore faithfully reported every penny of his income, and repeatedly expressed his intention to pay his taxes together with interest and penalties, freely conceded that he was unable to do so in a timely fashion, and share with the government the reasons why, and disclosed that he suffers from “hording disorder.”

Gilmore could face a potential decades-long prison sentence and fines between $250,000 and $1 million.