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Tag Archive for Robert McKenzie

A Collection… The Humorous Side of Tax… (23)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections. Enjoy!

♦ “It’s fitting that April 14 is National Pecan Day because today, we recognize nuts. And tomorrow, on April 15, we pay our taxes to support them.” – Craig Ferguson

♦ “Tax day is the day that ordinary Americans send their money to Washington, D.C., and wealthy Americans send their money to the Cayman Islands.” –Jimmy Kimmel

♦ Tax Day… A Procrastinators worst nightmare.

♦ Can I pay more taxes than I owe, because it’s not enough and the politicians can Read more

A Collection… The Humorous Side of Tax… (22)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections. Enjoy!

♦ A lawyer was reading out the will of a rich man to the people mentioned in the will: “To you, my loving wife Rose, who stood by me in rough times, as well as good, I leave the house and two million.”   The lawyer continued, “To my daughter Jessica, who looked after me in sickness and kept the business going, I leave the yacht, the business and one million.”  The lawyer concluded, “And, to my cousin Dan, who hated me, argued with me, and thought that I would never mention him in my will well you are wrong. “Hi Dan!”

♦ Isn’t it appropriate that the month when taxes are due begins with April Fool’s Day Read more

A Collection… The Humorous Side of Tax… (21)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections. Enjoy!

♦ “Today is April 1, April Fools’ Day, a day that people try to fool their friends and relatives. Don’t confuse that with April 15, when people try to fool the IRS.”

♦ April is always a difficult month for Americans — even if your ship comes in, the IRS is right there to help you unload it.

♦ “I’m not going to pay taxes. When they say I’m going to prison, I’ll say no, prisons cost taxpayers a lot of money. You keep what it would have cost to incarcerate me, and we’ll call it even.” – Jimmy Kimmel Read more

A Collection… The Humorous Side of Tax… (20)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections. Enjoy!

♦ “The U.S. Senate is considering a bill that would tax Botox. When Botox users heard this, they were horrified. Well, I think they were horrified. It’s difficult to tell.” — Craig Ferguson

♦ Public Accounting is the only profession where you have many engagements going on, yet no one is getting married! — Peter J. Scalise, Practice Leader, Federal Credits & Incentives, Prager Metis CPAs

♦ Excellence is a good habit. But do not strive for perfection – it will prevent you from ever finishing anything. – Eva Rosenberg Read more

A Collection… The Humorous Side of Tax… (19)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections. Enjoy!

♦ Did you hear about the cannibal Tax Accountant?  She charges an arm and a leg.

♦ A penny saved is a government oversight.

♦ Making out your own income tax return is something like a do-it-yourself mugging.

♦ A harp is a piano after taxes

♦ A certain tax lawyer was quite wealthy and had a summer house in the country, to which he retreated for several weeks of the year. Each summer, the lawyer would invite a Read more

A Collection… The Humorous Side of Tax… (18)

Each year during tax season I post some of my favorite tax quotes and tax humor on TaxConnections.  Enjoy!

♦ “I have no use for bodyguards, but I have very specific use for two highly trained certified public accountants.”   Elvis Presley

♦ When I was young I used to think that money was the most important thing in life. Now that I am old, I know it is. – Oscar Wilde

♦ “The tax code is so complex and the forms are so complicated, that I know I cannot have any confidence that I know what is being requested and therefore I cannot and do not know, Read more

TaxConnections Worldwide Tax Blogs Awards 2014 – Top Twenty Tax Bloggers

TaxConnections Worldwide Tax Blogs gives our readers an opportunity to get to know these tax experts better through their writing. We highly recommend you read TaxConnections Worldwide Tax Blogs to stay informed of emerging tax trends. We highly recommend you interact with our bloggers through your comments on their blog posts. Commenting on a tax bloggers post is a great way to let them know you appreciate the knowledge they have shared. We also recommend you connect with our bloggers on their TaxConnections Microsite. Simply click on their name on their blog post and you will be guided directly to their Microsite where you can connect with them easily on the “ Connect With Me” button.

Here are TaxConnections Top Twenty Worldwide Tax Bloggers:

Peter Scalise
Daniel Erasmus
Harold Goedde
Kathryn Morgan
Hale Stewart
William Richards
Steven Potts
Virginia La Torre Jeker
Michael DeBlis
Annette Nellen
John Dundon
Manasa Nadig
Jerry Donnini
Ronald Cappuccio
Betty Williams
Claire McNamara
Robert McKenzie
James McBrearty

Trust Fund Recovery Penalty – #16 – Appeal Procedure (Final Post In Series)

TaxConnections Picture - Dollar Sign and Money16. APPEAL PROCEDURE

§ 5:82 In General

You must submit a written protest to the assertion and assessment of the Trust Fund Recovery Penalty. An oral protest is inadequate. No interest will accrue during the pendency of your protest Therefore, delays by the Internal Revenue Service in processing a protest usually are to the client’s benefit. Upon receipt of a protest, the Revenue Officer will prepare a rebuttal and submit the file through Special Procedures function (SPF) to the Office of Appeals. [IRM]

§ 5:83 Appeals Conference

The appeal is considered by the Office of Appeals, which also hears appeals on audit matters. Your client has the right to have a personal conference with an Appeals Officer. He or she may be represented by an accountant or attorney and present evidence and witnesses on his or her behalf. [See also Representation Before the Appeals Division of the IRS, another Tax Practice Workbook]

If you convince the Appeals Officer that your client is not a responsible person, he or she will recommend nonassertion of the Penalty. If you fail to convince the Appeals Officer, an assessment will be made by the Service without your client being granted the right to go to Tax Court. Read more

Trust Fund Recovery Penalty – #15 – Defense Tactics

TaxConnections Picture - Dollar Sign and Money15. DEFENSE TACTICS

§ 5:75 In General

The practitioner’s goal in defending a Trust Fund Recovery Penalty is to remove the onus from one’s client and place it on some other person or in the alternative to limit the amount of liability. Literally, one of the best ways to protect your client is to use the “he did it” defense. Blame someone else!

§ 5:76 “He Did It” Defense

The “he did it” defense can first be asserted at the initial interview of your client. Be prepared to present documentation to support why another person bore ultimate responsibility for payment of the taxes. The best evidence may be affidavits from third parties and your client asserting that some other party was responsible.

§ 5:77 Protest

Upon receipt of the letter proposing liability, submit a protest in the format set forth on the back of the IRS letter. Even if your client is a responsible person and willfully failed to pay the tax, you may protest the computation of the tax. It is not unusual for the IRS to miscalculate the Trust Fund Recovery Penalty and you have the right to assure that the penalty is in the proper amount. Read more

Trust Fund Recovery Penalty – #14 – Recommending Assertion of Penalty

TaxConnections Picture - Dollar Sign and Money14. RECOMMENDING ASSERTION OF PENALTY

§ 5:70 In General

Having completed a preliminary investigation, the Revenue Officer next prepares proposed Trust Fund Recovery Penalties against the persons whom he or she believes to be responsible persons. For this purpose the Revenue Officer prepares a report titled “Recommendation Re: Trust Fund Recovery Penalty Assessment.” The report calls for the Revenue Officer to determine whether to assert against each potentially responsible person. The Officer can decide not to assert against a responsible person if it is determined that the penalty would not be collectible from that party. (Since the Internal Revenue Service views the Trust Fund Recovery Penalty as a collection device, the author has found that the greater his client’s net worth, the less likely the IRS is to determine the client not to be a responsible person.)

§ 5:71 Notice To Taxpayer

The completed recommendation is presented to the Revenue Officer’s Group Manager for concurrence. Upon approval by the Group Manager, a Letter 1153 and Form 2751 (Proposed Assessment of Trust Fund Recovery Percent Penalty) are mailed to each potentially responsible person. The letter is mailed to the person’s last known address. That letter grants the taxpayer ten days to contact the Revenue Officer to present a defense, or the taxpayer may request an appeals conference within sixty days of the letter. The format for a protest is set forth on the reverse side of the letter. Read more

Trust Fund Recovery Penalty – #12 – IRS Investigation Techniques

TaxConnections Picture - Dollar Sign and Money12. IRS INVESTIGATION TECHNIQUES

§ 5:64 In General

At any time after an employer fails to pay trust fund taxes, the IRS may begin investigating a proposed Trust Fund Recovery Penalty. It is standard practice for the Service to begin investigating any time a Revenue Officer discovers that a company owes taxes. Many times the Revenue Officer will begin the process when the company is still operating and has entered into a payment agreement with the Service. [IRM] If the payment agreement will be for more than 18 months, the potentially responsible officers must sign a statutory waiver to avoid assessment. [IRM 5:7.4.8] The Service views the Trust Fund Recovery Penalty as a collection tool and rightly believes that the threat of personal liability will cause the management of an operating company to maximize payments to the IRS. Such a policy can create severe management disruptions if corporate officers must try to juggle corporate financial problems, conflict to each other, and the potential for personal financial devastation if they are assessed a Trust Fund Recovery Penalty. In many areas, the Service will assess responsible persons and begin collection from the officers even though the corporation is still operating and making payments on its overdue taxes. [IRM]

§ 5:65 Interviews With Potentially Responsible Persons

The IRS normally begins its investigation Fund Recovery Penalty by interviewing corporate officers. The IRS utilizes an interview form titled “Report of Interview Held with Persons Relative to Recommendation of 100-Percent Penalty Assessments.” Upon review of the form you will note that the interview format takes two approaches: (1) the gathering of corporate financial and organizational information; and (2) the gathering of information relative to proving responsibility and willfulness. Read more

Trust Fund Recovery Penalty – #10 – Direction Of Payments

TaxConnections Picture - Dollar Sign and Money10. DIRECTION OF PAYMENTS

§ 5:52 In General

One method of reducing the potential trust fund liability is to assure that the employer designates each payment made on account by placing a restrictive endorsement on the back of each check worded as follows:

“Direct to Trust Fund Portion of taxes only for the period ended for Corporation.” [IRM 5.7.7 & IRM 8.11.2]

§ 5:53 Designated Payments

The Internal Revenue Manual directs that the Service will follow the taxpayer’s direction of payments and states as follows:

“A designated payment is a voluntary one that the taxpayer has directed to be applied in a particular manner; i.e., a specific period, kind of tax, tax portion, interest, etc. Normally such direction will be followed by the Service.” [IRM]

§ 5:54 Contemporaneous Direction

The courts have consistently held that a designation made contemporaneously with a payment must be applied by the Internal Revenue Service in accordance with such direction. Therefore, if you make a designation on the back of the check, the entire amount must be applied toward the trust fund portion. The direction must be written, and the IRS need not honor an oral direction. Read more