Segal, Cohen & Landis Reviews Enrolled Agents: Tax Law “Forgotten” Professionals

When it comes to tax law or tax issues, three types of professionals come to mind—Internal Revenue Agents themselves, Certified Public Accountants (CPAs), or tax attorneys. The forgotten members of this sector are often enrolled agents.

When faced with a tax audit, enrolled agents, who sometimes work with tax attorneys, may also represent taxpayers with the Internal Revenue Service. Currently, there are around 50,000 enrolled agents practicing in the United States. Unfortunately, these individuals have a few issues that keep them tax law’s hidden professional.

According to a recent article in Forbes, enrolled agents are not licensed by the states, which makes it difficult to advertise and forces them to use other titles other than that given to them by the passing of the test administered by the Internal Revenue Service. The article goes on to postulate that legislation regarding this was meant to protect CPAs, but unfortunately, it was adversely affecting enrolled agents attempting to practice their profession. Proposed legislation would make it possible for enrolled agents to display their titles and advertise, just as tax attorneys and CPAs are able to do.

The article goes on to discuss the advantages of CPAs and Enrolled agents, as they are able to do a taxpayers return and also represent the taxpayer in the event of an audit.

In the event of an audit that goes beyond stage one, it can be beneficial to have an enrolled agent on your side. Audits can often be complicated beyond that stage though, and consulting with an experienced tax attorney who has dealt with many audits may mean the difference in the end.

Segal, Cohen & Landis, LLP is a law firm with the tax professionals with the knowledge and experience to get the best results for taxpayers with tax issues. Not only do they have tax attorneys with decades of experience, they also have enrolled agents in the office who can offer their unique and crucial expertise.

If you are facing a tax issue, simple or complicated, contact your tax professional today to begin the process that could end in a favorable resolution.

Segal, Cohen & Landis, LLP
9100 Wilshire Blvd. Ste. 601E
Beverly Hills, CA 90212
(310) 285-3999

Segal, Cohen & Landis Reviews the Bright Side for Pro Golfer Phil Mickelson (Tax-Wise, That Is)

After his sixth consecutive second place award at the U.S. Open, Phil Mickelson may not have been thinking about the tax benefits of his loss, but according to a recent Forbes article that takes a more humorous look at Mikelson’s recent loss, he should have been.

While he may not have won the golf game, Forbes Contributor makes the sly argument that he may have won the tax game, as he goes on to enumerate the various ways in which Mikelson would have accrued a larger tax bill. He points out that Mikelson announced, with controversy following, that he would do what he could to reduce his California tax bill substantially.

Analyzing the outcome if he had won, Mikelson would have earned the generous sum of $ 1.44 million; instead, as a second place finisher, he earned $696,000. By failing to win the big prize and score the extra $743, 896 in winning revenue, Mikelson also avoided having to pay $76,100 in his state of California income tax.

Last fall, voters approved an increase of 3% to the tax rate, solidifying its place as the highest rate in the country.

In addition to the tax rate issue, the Forbes contributor pointed out that such a win would possibly have included opportunities for lucrative sponsorship deals. High taxes would have inevitably been imposed on any earnings from his sponsors.

Although he may not have won the big prize on the golf course, he can (possibly) take solace in his tax bill.

Segal, Cohen & Landis, LLP
9100 Wilshire Blvd. Ste. 601E
Beverly Hills, CA 90212
(310) 285-3999

The Law Offices of Segal Cohen and Landis reviews the Ernst and Young Case

The tax world is often very difficult to understand due to its various rules and regulations. Sometimes, these rules do not immediately make sense. This leads to difficulty in preparing taxes. As such, having a tax lawyer is crucial to paying taxes. Tax law offices are fully immersed in the regulations established by the Internal Revenue service. Therefore, a tax lawyer can make the process of paying taxes quick, easy, and legal.

Naturally, any working American will seek ways to minimize their tax payment, which can best be done through the use of a tax lawyer. Tax avoidance, or the way that an individual or a tax attorney can legally reduce taxes, is helpful in many cases. Unfortunately, even with this benefit potentially provided by tax lawyers, there are those who choose to evade taxes. This is highly illegal and often results in jail time, especially if there is no tax lawyer around to help. When an individual evades taxation, they are willingly missing out on an opportunity for a tax lawyer to take care of some of their needs. It’d be much better for an individual to just contact a tax attorney and create options. Unfortunately, this is not always done, as demonstrated by recent activity within Ernst and Young.

This particular situation involved senior tax partners who evaded taxes for many years. Because they were discovered, they will face prosecution. It is important to take note of the difference between tax partners and tax lawyers. Tax partners are mostly familiar with only the payment of taxes. Tax lawyers, on the other hand, have been trained extensively to deal with exceptions and special conditions. Tax attorneys are much more useful in creating options, while tax partners are usually limited to the knowledge of their day-to-day jobs.

Perhaps if one of these tax partners had contacted a tax lawyer, they would have discovered a way to legally avoid a portion of their tax payment rather than revert to evasion. Instead, they must face their situations on their own without the help of professional tax lawyers. Since a tax lawyer specializes in creating more options, neglecting to contact one is a big mistake. Regardless of the complexity of taxation calculation, tax attorneys are essential in understanding the process behind payment.

In this case, Ernst and Young found that its senior tax partners had been advocating tax evasion procedures amongst themselves for several years. While not likely, it is possible that one of these partners simply did not know they were violating IRS regulations. This brings up another interesting point: if there is any uncertainty, then you are better off contacting a tax lawyer to set up an appointment to discuss taxes. A tax attorney can point out areas in which an individual can save money. More importantly, tax lawyers can recognize areas where the client may be bordering on legality. Tax attorneys can then give advice to prevent the consequences from IRS.

As a result of this scandal, Ernst and Young had to make a large payout to avoid its own prosecution. However, even this large sum did not cover the damage caused by the corrupt individuals. This “settlement” was probably made possible only through the use of multiple tax attorneys. Since tax lawyers are great at presenting information to the court in an appealing manner, such news would not be very surprising.

Tax lawyers and tax attorneys are always available and ready to help. They can point out everything you need to know about taxation. If you are not doing well financially, tax lawyer and tax attorneys can help find a way out of the situation.

The taxation world is a warzone; it is best to be armed with a good tax lawyer.

Segal, Cohen & Landis
9100 Wilshire Blvd. Ste. 601E
Beverly Hills, CA 90212
(310) 285-3999

Segal, Cohen & Landis Reviews the Foreign Income Exclusion

According to a recent article in Forbes, Robert Wood discusses whether or not an individual qualifies for Foreign Income Tax Exclusion, which allows individuals who qualify to collect money tax-free.

The primary source for information regarding this matter is a case, James F. Daly and Candace H.Daly, wherein the Tax Court ruled that the couple did not qualify for the exclusion, even though the husband worked primarily overseas in Iraq and Afghanistan. The ruling stated that although he worked in those countries, his tax home remained the United States.

It is no wonder that the Daly’s attempted to utilize the income exclusion, as it is a “great benefit” that allows income of up to $97,000 to remain tax free. In order to meet the criteria though, the individual must either be a U.S. citizen that is a resident of one or more foreign countries for an uninterrupted amount of time that includes one full tax year; or a U.S. citizen who is a present in a foreign country (or countries) for 330 in 12 consecutive months.

Unfortunately for the Daly’s, the Tax Court ruled that the Foreign Income Exclusion was not applicable to them, despite the fact that waivers have been granted in some cases.

Segal, Cohen & Landis
9100 Wilshire Blvd. Ste. 601E
Beverly Hills, CA 90212
(310) 285-3999

Segal, Cohen & Landis Reviews Important Tax Dates in June

A recent article in Forbes highlighted important tax dates that taxpayers should be aware of when dealing with the Internal Revenue Service in the month of June.

The first date taxpayers should keep in mind is June 3rd. According to a press release by the IRS, the victims of the Moore, Oklahoma have been granted tax relief. The relief is granted to businesses affected by the late May storms. The businesses have until June 3 to make federal payroll and excise tax deposits. For all other businesses, these particular taxes are due on or after May 18 and before June 3.

A date with broader consequence for taxpayers is the second IRS furlough day. On this day, one of five scheduled to occur this summer due to budget cuts, all IRS offices will be closed—including any hotlines, Taxpayer Advocate Offices, and taxpayer assistance centers. All employees are off without pay on this day, meaning no correspondence or calls will be answered. Tax Returns will not be processed on this day, nor will their receipt be acknowledged. The furlough affects extend to even the online resources, including the refund tracking tool and the payment system—both of which will not be functioning on that day. Unfortunately for taxpayers, the furlough day does not affect any deadlines. All deadlines remain the same.

For those taxpayers who were out of the country on April 15th, their automatic two-month extension for their federal income tax return expires on June 17th. Taxpayers must provide documentation that they meet the requirements for the late filing, including proof that they were either living out of the country and their main place of business was also out of the country, or they are serving in the U.S. military outside of the United States.

June 17th is also the date that estimated tax payments are due for both individuals and corporations.

Taxpayers with signature authority or any interest in a foreign financial account should be aware of the June 30th deadline if they are required to file an FBAR. If you have any questions regarding whether or not you are required to file an FBAR, it is best to contact your knowledgeable tax professional.

The article notes that any other payments required by any agreements are due when designated.

Segal, Cohen & Landis
9100 Wilshire Blvd. Ste. 601E
Beverly Hills, CA 90212
(310) 285-3999