May 112017

Wash. D.C.

President Trump plans to mark National Day of Prayer issuing an executive order that makes it easier for churches and other religious groups to actively participate in politics without risking their tax exempt status several administration officials said. Taking action as he hosts conservative religious leaders, Mr. Trump’s executive order would attempt to overcome a provision in the federal tax code that prohibits religious organizations like churches from directly opposing or supporting political candidates. The move is likely to be hailed by some faith leaders, who have long complained that the law stifles their freedom of expression. But the order falls short of a more sweeping effort to protect religious liberties that has been pushed by conservative religious leaders since Mr. Trump’s election.

Many clergy members say they do not want to endorse political candidates from the pulpit because it could split their congregations and distract from their religious messages. This appears to be the case even among evangelicals, although it is Mr. Trump’s conservative evangelical advisers who encouraged him to address the issue. A coalition of evangelicals, Roman Catholics, Mormons, and Orthodox Jews has been eagerly awaiting a so-called religious liberty order, which they also hope will exempt religious entities from providing their employees with coverage for contraception in their health care plans.

If is unclear how the executive order will get around the tax code provision for churches, since eliminating it would require legislation by Congress. But faith leaders who have had discussions with White House officials about the issue said Mr. Trump could direct the Internal Revenue Service not to actively investigate or pursue cases of political activism by members of the clergy in churches. Such a directive might be challenged in court. But in the meantime, pastors could feel freer to actively participate in coming elections without fear of being investigated and having their tax exempt status revoked by the federal government.

Churches and clergy are free to speak out on political and social issues–and many do–but the Johnson amendment served to inhibit them from endorsing or opposing political candidates.

Apr 292017

Wash. D.C.

President Trump’s promise to enact a sweeping overhaul of the tax code is in serious jeopardy nearly 100 days into his tenure, as Trump’s taxes not being released is becoming a central hurdle to another faltering campaign promise. As procrastinators rushed to file their tax returns, the White House press secretary, Sean Spicer, emphasized that Mr. Trump  had no intention of making his public. Democrats have seized on that decision, uniting around a pledge not to cooperate on nay rewriting of the tax code unless they know specifically how that revision would benefit the billionaire president and his family. Trump’s taxes may end up preventing tax reform after all. And a growing number of Republican lawmakers now say Mr. Trump should release them.

“If he doesn’t release his returns, it is going to make it much more difficult to get tax reform done,” said Senator Chuck Schumer, the Democratic leader, pointing out that the president has significant conflicts of interest on issues such as taxation of the real estate industry and elimination of the estate tax, “Its in his own self interest.” With Republicans sharply divided on a path forward and the administration unable to come up with a plan of its own, the Democratic resistance is only the newest impediment.

As a candidate, Mr. Trump declared that he understood America’s complex tax laws “better than anyone who has ever run for President” and that he alone could fix them. But it is becoming increasingly unlikely that there will be a simpler system, or even lower taxes, this time next year. The Trump administration’s tax plan, promised in February, has yet to materialize: a House Republican plan has bogged down, taking as much fire from conservatives liberals, and Treasury Secretary     Mnuchin told the Financial Times that the administration’s goal of getting a tax plan signed by August was “not realistic at this point.”

The just released proposal by the  president contains nothing but bullet points, with very little specifics about how the proposals would be enacted.

Apr 282017

Wash. D.C.

Trump’s tax plan, released wednesday, consists of a single page of bullet points. If this were a more rounded plan, we could wait for the tax wonks at various think tanks to run it through their models and tell with some precision how it would affect people at different income levels and who would benefit from different deductions. Lacking that level of detail, Trump’s tax plan only reveals in broad brush strokes which Americans would win and which would lose. In a homage to the Trump plan itself, here are those winners and losers in bulleted form.

Businesses with high tax rates. Trump’s tax plan would cut the 35 percent corporate income tax to 15 percent. While few businesses pay the full 35 percent rate, those that pay something close to it are in line for a huge tax cut. High income earners would get a reduced rate on individuals income tax, under Trump’s tax plan–now 39.6 percent for income over $470,000 for a married couple–to 35 percent. It would also eliminate the 3.8 percent tax, used to help fund Obamacare, that applies to investment income over $250,000 for a couple.

The 15 percent business tax rate could open a huge loophole for people to receive business income through a Limited Liability Company or other pass through entity. It would also eliminate the estate tax, which currently applies to individuals with estates of $5.5 million or couples with estates worth over $11 million. The Trump Administration did not embrace House Republicans strategy to pay for the tax cut, with the “border adjustment tax”, which was strongly opposed by the retail industry and other that thought they would be losers.

In Trump’s tax plan, it is striking how many of the categories listed above affect the president and his family. He is a high income earner, and the estate tax would apply to him, as would the pass through business provisions.

Apr 102017


In interviewing thousands of people for tax resolution services, we are asked this question all the time. Actually, the conversation usually starts off like, “I saw a TV ad that said I could get off of my $50,000 IRS tax debt for a small amount, is that trus ?”  This is common these days, due to TV ads that make claims across the board, as if every person can accomplish this. Is it possible ? Maybe. Do you really want me to tell you that within talking to me for 5-10 minutes ?  And if I did, would you really believe me ?  Shame on you if you did !!!!

Years ago, when the IRS didn’t disclose the “Offer in Compromise” option to taxpayers, because the Internet didn’t exist and most people didn’t know how to find that information, several companies were “selling” it, as they had discovered it in the Internal Revenue Code. I started nearly 27 years ago working for the second largest company in the tax resolution services field. Both are out of business now for shady practices. I left the company I worked at, after figuring out what they were doing, and telling myself it was not ethical and I left.  The question is, do you want the best solution, or are you someone who will only move forward in solving a tax problem, if its on your terms.

What do we mean by that ?  Let me explain by telling a true story of a fellow in texas who owed nearly $45,000. This was over 20 years ago. We were able to reduce his debt down to $7800. Now if I was his stockbroker and he invested $7800 and I put him in an investment that returned $45,000 into his pocket within one year, he would be tickled pink. This man was mad as hell and actually cursed at me, demanding a refund. The problem was, during the processing of the Offer in Compromise, he stopped selling annuities on the weekends, which he never told us about when we submitted his offer. This reduced his ability to pay. So the IRS accepted a lower Offer than what we had submitted, and he deemed that our fault, even though he never gave us the information.

After I explained to him that we were not mind readers and had no way to know the offer amount would be lower, he was undeterred and still wanted a refund. The amazing thing about this story is that the impact on his net worth would be the same either by eliminating debt, or if I was a stockbroker, had put money INTO his picket.



 04/10  Tagged with:  No Responses »
Apr 032017

Wash. D.C. IR-2017-56

The Internal Revenue’s Service’s Low Income Tax Clinic office has issued its annual program report, which details how it has provided representation, education, and advocacy for taxpayers who are low income or speak English as a second language. During 2015, it represented 18,751 taxpayers in disputes with the IRS and provided consultation or advice to an additional 18,810 taxpayers. The tax clinic helped secure more than $4.3 million in tax refunds and eliminate more than $64 million in tax liabilities, penalties, and interest.

Through outreach and education activities, it also ensured individuals understood their rights as U.S. taxpayers. It conducted over 3,000 educational activities attended by over 78,000 persons. Overall, more than 1,800 volunteers contributed to the success of the tax clinic. The full report contains more details about the programs and stories about the services that it provides. It also describes more fully the results that the tax clinic achieves on behalf of their clients. Multiple stories of the help that these clinics offer are available as guidelines to other taxpayers who are considering applying for help themselves.

The IRS program has also posted on the update of information about this program. The information contains the names and contact information for the 2017 Low Income Tax Clinic grant recipients that can provide representation and education to low income taxpayers and taxpayers who speak English as a second language. The IRS awards matching grants of up to $100,000 per year to qualifying organizations to develop, expand, or maintain a Low Income Clinic. They are usually operated by accredited law, business, or accounting schools. Legal aid or legal services organizations. Other tax exempt organizations that assist low income individuals and families.

If you earn too much, but need helping filing your tax returns, call us at 1-888-689-7861 for a free Tax Resolution Services consultation today.

 04/03  Tagged with: ,  No Responses »
Mar 072017

Wash. D.C.

A House Democratic lawmaker has forced the House to vote on a resolution to request President Trump’s tax returns, but the effort failed on a party line vote-229-185-with two Republicans voting “present”. The move was the latest in a series of Democratic efforts to push Congress to request Trump’s tax returns, and Democrats demanded a roll call vote to force Republicans to go on the record. The two Republicans who voted present were Reps. Walter Jones (N.C.) and Mark Sanford (S.C.). Sanford is one of the Republican lawmakers who has in the past called for Trump to release his returns.  The tax resolution of Trump’s tax situation could be resolved by all parties if the information was released.

After the vote, House Minority Leader Nancy Pelosi fired at the GOP. “Tonight, House Republicans made themselves accomplices to hiding President’s Trump’s tax returns from the American people,” she said. “Our security and our democracy have been endangered by Russia’s clear influence on the Trump Administration. The american people deserve the truth about Russia’s personal political and financial grip on President Trump. If there’s nothing there, then what are Republican’s afraid of ?

Rep. Bill Pascrell (D. N.J.) offered a resolution that would have directed the House to request 10 years of Trump’s tax returns, have the House Ways and Means Committee review then in a closed session and ten vote to send the information in the returns to the full house. Under federal tax law, the chairman of the House Ways and Means and Senate Finance Committees and Joint Committee of Taxation can request ta returns from treasury to be considered in a closed meeting. The resolution would also direct the House to “support transparency in government and the longstanding tradition of Presidents and Presidential candidates disclosing their tax returns”.

Trump was the first major party presidential nominee in decades to refuse to release his tax returns. He frequently said that he wouldn’t make his returns public until the IRS finished auditing him. However, the IRS has said that an audit doesn’t prevent people from releasing their own tax information.

If you face an IRS audit and tax bill, call us for your Tax Resolution. 26 years of Nationwide Tax Resolution Services.


Mar 032017

Wash. D.C.

The child tax credit is for taxpayers with qualifying children–and they can claim this super tax credit on top of the earned income tax credit and credit for child and dependent care expenses. The child tax credit could be worth up to $1000 per child living in your household.

To qualify, you must claim the child as a dependent on your taxes,and the child must be a U.S. citizen and have lived with you for at least half of the year. Additionally, the child must not provide more than half of his own support. You might qualify for this super tax credit if your MAGI is less than the following amounts:  $75,000 for single filing status,  $55,000 for married filing separately, head of house hold or widower,  $110,000 for married filing jointly.

The Lifetime Learning Credit is an educational super tax credit that’s similar to the American opportunity credit. However, if you claim one of these two credits, you cannot claim the other. Unlike the refundable American opportunity credit, the Lifetime Learning Credit is nonrefundable. You can claim the LLC for an unlimited number of tax years but the AOC has a four year maximum.

The Lifetime Learning Credit lets you claim up to $2,000 to help off set the educational costs of a qualifying student. The credit comes with relatively high modified adjusted gross income caps: $130,000 if you’re married and filing jointly and $65,000 if you’re filing as single, head of household or qualifying widower. However, you can’t claim the credit if you’re married and filing separately. The tax credit is available regardless of your age as long as it goes toward a qualified educational expense. Acceptable expenses include tuition, student activity fees and course related books, supplies and equipment.

These and other super tax credits are available in the Internal Revenue Code, but you must have the knowledge that they exist, and when you may use them. Having a good tax professional determine that can save you thousands

National Society of Tax Professionals

of dollars when you file your taxes.

 03/03  Tagged with:  No Responses »