Posted by LWM Team on Wed, Aug 11, 2010
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To The IRS A Tax Evader Is A Tax Evader
It has been noticed that over the years many well known personalities don’t pay or even report their taxes. This is, of course, against Uncle Sam’s law. These personalities are brought to book and one such example of this type of circumstance is Tsen Toma. Towards the end of the nineties, this person operated his own business called Tomo Painting Construction. It was this business that caused Tsen Tomo to be indicted for tax evasion.
Tsen Toma was indicted because when he got checks from customers as payment for services rendered by Tomo Painting Construction, he cashed them. However, that cash was for private use. The checks were cashed at various check cashing establishments. The checks he cashed came to over a million dollars but Tsen Toma did not keep any verification in the form of receipts.
He continued to do this over a period of three years but his business records didn’t show the check payments and nor did he not notify the IRS on his tax return. In the 1998 tax year, Tsen Tomo did report a taxable amount of $29,901. However, the IRS discovered the amount should have been $452,244. This adjustment by the IRS resulted in extra tax of $168,718.
According to media releases Tsen Toma departed from the United States while under investigation by the IRS. This action led him to be placed under arrest. The arrest was carried out at Kennedy Airport on his return from the country of Taiwan. This happened on 24 November. The consequences of Toma’s actions could result in a prison sentence of five years and also a $25,000 or two times the gross gain emanating from the offense of tax evasion. This shows taxpayers that Uncle Sam does not tolerate tax evasion by any person in the United States.
Don't evade your taxes. Tax debt is no laughing matter.
Posted by LWM Team on Tue, Apr 27, 2010
Enforcement action can take the form of issue of a Notice of Levy. This is carried out on a salary and any additional income, bank accounts or property that is lawfully confiscated to fulfill the tax debt.
Assessing a Trust Fund Recovery Penalty is on behalf of particular employment taxes that are unpaid. Issuing a Summons to a third party or directly to a taxpayer is carried out to acquire information to be used to get ready tax returns that are unfilled or to find out the capacity of the taxpayer to make payment.
It is important the taxpayer knows that to bring in illicit tax debts there must be specific federal payments (federal employee travel, vendor, federal salary, OPM and SSA) by the Department of the Treasury and Financial Management Service that may be incur a levy via the FPLP (Federal payment Levy Program).
Employees must understand what makes up employment taxes:
Quantity of social security tax and Medicare tax paid by the employer for the employee
Quantities that must be withheld by the employer from the employee for medical tax also known as withheld or trust fund tax
An employee may be held liable for the payment of extra penalties as well as interest if employment taxes are paid late. The extra penalties and interest is paid on balances that are overdue. FTD or Failure to Deposit could result in a fine up to fifteen percent on the overdue amount of tax that is late. The amount of the fine is based on the number of late days. It is possible the IRS
may request, under penalty of prosecution, an employer initiates a bank account only for withheld amounts or that employment taxes be paid and filed every month instead of quarterly.
An employer can assist employees in keeping up with tax payment requirements by signing up and paying existing tax deposits via EFTPS or Electronic Federal Tax Payment System.
Posted by LWM Team on Tue, Feb 23, 2010
The IRS isn't people's most favorite government agency but every year it's a necessary evil for us to file taxes by April 15th. Well prepared businesses will hire accountants to complete them way before the deadline so they are sent and done with well before that date. Individuals, however, will often put them off until the last minute and sometimes forget to send them or do so intentionally. This can lead to the buildup of one or more unfiled tax returns.
Here are three easy steps to take care of those unfiled tax returns.
1. Get your paperwork in order.
Maybe you didn't send them on time or maybe you haven't even started to get them ready.
Either way, make sure all your wage stubs, receipts, and other important paperwork is on hand and get them completed. If you don't have it, you will have to make a lot of calls to old employers to get copies of your W-2 forms. The IRS has forms you may need also so check with them.
2. Send in your unfiled tax return immediately.
The IRS won't start sniffing into your assets or calling you every day if you have sent all your old tax returns in. his will also stop penalty fees from building up. Even if you can't pay what you owe, send it in and you can make a payment plan.
3. Prepare for the future.
The IRS doesn't like if you wait longer than one year to file any tax return so it's a great idea to prepare for this in the future. If you don't want to do it yourself or don't feel like you will have it done on time, let a tax preparer handle it.
Unfiled tax returns can get you hefty fines and even jail time depending on how much you owe and how you handle the IRS. Make sure you do it their way and everything should work out great.