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Minneapolis Tax Law Blog

IRS crackdown on fraud can spillover to honest taxpayers

The Internal Revenue Service (IRS) has increased its efforts to crackdown on fraud. The push began in 2015 when tax fraud was at "near crisis" levels. This caused the IRS to pair up with state officials in an effort to better detect false returns.

Has this push worked? The IRS’ collaboration with state officials along with use of software to flag suspicious returns has proven successful. Fraudulent returns dropped by 72 percent since 2015 

How did the TCJA impact NOL?

The Tax Cuts and Jobs Act (TCJA) led to major tax reform. We are starting to see the impact of these changes as individuals begin filing their tax returns for the 2018 tax year. Because the changes were so large, it is helpful to focus in on specific areas to understand how the TCJA affects that part of a taxpayer’s tax returns.

One example: net operating loss (NOL).

How can I pay an unexpected tax bill?

Perhaps your estimated tax withholdings were not enough or maybe a tax bill has been growing over the years. Whatever the reason for a large, unmanageable tax bill it is important to know that there are options to help you pay your bill.

Option #1: Pay a portion of the bill. It can be beneficial to pay off at least some of the bill. This generally means the Internal Revenue Service (IRS) will only penalize you for the unpaid portion of the tax bill.

Three tips before filing 2018 tax returns

Tax season is upon us. Taxpayers throughout the country are likely organizing tax forms and getting the new paperwork or computer programs ready for the upcoming filing deadline.

These tips can help prepare taxpayers as they get ready to file tax filings to the Internal Revenue Service (IRS) under the new tax law:

Recent tax crime convictions highlight severity of penalties

Fraud against the Internal Revenue Service (IRS) can come with serious penalties. A couple of recent cases provide examples:

Case #1: Married couple faces serious prison time for tax fraud, money laundering

IRS and tax audits on 2018 filings: Avoid these common red flags

The Internal Revenue Service (IRS) is up and running after the recent government shutdown. Although another government shutdown may be in the future, a recent publication by CNBC notes the temporary closure of the office is not likely to result in a decreased audit risk. This is because the agency has implemented various technological advances to review returns and flag discrepancies.

Three things to know to prep for your 2018 tax returns

Getting ready to file your 2018 tax returns with the Internal Revenue Service (IRS)? If so, you have likely noticed the process is a bit different this year. 2017 marked some big changes — most notable in the tax world the passage of the Tax Cuts and Jobs Act (TCJA). This new law was the biggest reform to the United States Tax Code in decades.

Although there are many changes, three specific things to note before beginning your returns include:

“Zappers” back in the news with fraud charges filed

The sales suppression software, often referred to as “zappers” secretly delete most cash transaction. They make a company’s books appear accurate, but in fact they under report actual sales. Some estimates suggest this software exists on 30 percent of electronic cash registers.

Minnesota is one of about five states cracking down on owners of companies that use the technology, while federal prosecutions lag. These businesses tend to be in the restaurant industry.

Forget to adjust tax withholdings? You may be off the hook.

The United States government requires taxpayers to make tax payments throughout the year. Taxpayers often meet this obligation by withholding tax payments from their paychecks or making estimated tax payments throughout the year. However, if a taxpayer fails to pay a certain percentage of his or her tax obligation throughout the year, the Internal Revenue Service (IRS) will issue a penalty.

However, according to a recent statement from the IRS, the federal agency may forego penalties for 2018 tax filings.

Three tips for businesses as they prepare to file 2018 taxes

As 2018 comes to a close, business owners are likely gathering paperwork and reviewing documents in preparation to navigate the first set of tax filings under the new laws passed with the Tax Cuts and Jobs Act (TCJA). Although changes are complex, three specific things to keep in mind that impact a large number of businesses include:

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