Federal tax code is designed to reward charitable giving by allowing exemptions so long as they fall within legal guidelines. Of course, the Internal Revenue Service can scrutinize these deductions in an effort to file tax deficiency claims.
Individual members of the Forbes family, known as long-time leaders in the publishing world, are caught up in a tax dispute with the IRS. According to reports, federal tax officials claim that multiple members of the family incorrectly claimed deductions on the value of business property. The claims are related to the idea that the Forbes’ made deductions on the property four years before it was sold to New York University.
In response to the IRS claims, the Forbes family indicates that the claims are incorrect. Contrary to what tax officials say, legal petitions filed by the family say that they met the requirements for making the deductions in 2006. At this time, the dispute with the IRS is ongoing, so the hope is that it is resolved fairly.
Like any other claim lodged by the IRS, this one should not be taken lightly. Although each of the Forbes brothers and their spouses have been accused of owing differing amounts to the federal government, the claims for deficiency total almost $2.5 million with penalties. Specifically, Steve Forbes, who gained a national profile as a presidential candidate, and his wife allegedly owe more than $400,000 in taxes and penalties, according to IRS claims.
Dealing with the IRS is no simple task; tax law is immensely complex. However, this doesn’t mean that taxpayers should simply accept that they will have to pay back taxes or fines. Rather, there may be options to dispute the claims and work toward a positive resolution.
Source: The Wall Street Journal, “Forbes Family in IRS Tax Dispute,” William Laudner, Dec. 19, 2013