Join me as I walk you through an introduction to IRS Appeals. In this podcast, I discuss the IRS Appeals process along with the following:

Join me as I walk you through the anatomy of a civil tax controversy from A through Z. This webinar will cover each step in the process, and will take a closer look at what to do during an eggshell audit. Other topics to be discussed include cases typically recommended for prosecution, attorney-client privilege in the tax realm, Kovel Agreements, IRS Appeals, and more.

Learning Objectives:

• Gain an in-depth overview of the anatomy of a civil tax controversy from A through Z
• Develop best practices for walking your client through an eggshell audit
• Review attorney-client privilege in the tax realm
• Discuss the use of a Kovel Accountant and drafting an airtight Kovel Agreement
• Comprehend the IRS Appeals Process
• Evaluate the hazards of litigation

To access the slides, click here.

This is a webinar from a recent presentation that I did for CPA Academy. I am honored to lecture for such a fine CPE provider.

This was a presentation that I did for CPAAcademy on February 26, 2019. I am honored to be a guest lecturer for this fine CPE provider. Enjoy.

This is the last part of my presentation on, "Is that Worker An Employee? Questions and Answers on Worker Classification." The topic is "Requesting a Tax Court Determination."

Course Description

If you own or manage a business that uses independent contractors, you need to know when you can or cannot treat a worker as an independent contractor. This presentation answers some of the common questions about worker classification.

INTRODUCTION

Misclassification of employees as independent contractors is now a common phrase uttered by state and federal legislators and regulators. State task forces have been formed to crack down on businesses that do not pay unemployment insurance and workers’ compensation premiums or withhold taxes for workers whom the state believes are employees and not independent contractors.

In this podcast, I discuss how to calculate the 5 percent miscellaneous offshore penalty under the streamlined domestic procedures.

The miscellaneous offshore penalty is equal to 5 percent of the highest aggregate balance/value of the taxpayer’s foreign financial assets that are subject to the miscellaneous offshore penalty during the years in the covered tax return period and the covered FBAR period. For this purpose, the highest aggregate balance/value is determined by adding the year-end account balances and year-end asset values of all the foreign financial assets subject to the miscellaneous offshore penalty for each of the years in the covered tax return period and the covered FBAR period and selecting the highest aggregate balance/value from among those years.

A foreign financial asset is subject to the 5-percent miscellaneous offshore penalty if the asset should have been, but was not, reported on an FBAR (FinCEN Form 114) for that year. A foreign financial asset is subject to the 5-percent miscellaneous offshore penalty in a given year in the covered tax return period if the asset should have been, but was not, reported on a Form 8938 for that year. A foreign financial asset is also subject to the 5-percent miscellaneous offshore penalty in a given year in the covered tax return period if the asset was properly reported for that year, but gross income in respect of the asset was not reported in that year.

For information on the meaning of foreign financial asset, see the instructions for FinCEN Form 114 and the instructions for Form 8938. For example, foreign financial assets may include:

• financial accounts held at foreign financial institutions;
• financial accounts held at a foreign branch of a U.S. financial institution;
• foreign stock or securities not held in a financial account; 
• foreign mutual funds; and
• foreign hedge funds and foreign private equity funds.

In this podcast, I discuss the instructions for making a submission to the streamlined domestic offshore program.

1. For each of the most recent 3 years for which the U.S. tax return due date (or properly applied for extended due date) has passed, submit a complete and accurate amended tax return using Form 1040X, Amended U.S. Individual Income Tax Return, together with any required information returns (e.g., Forms 3520, 3520-A, 5471, 5472, 8938, 926, and 8621) even if these information returns would normally not be submitted with the Form 1040 had the taxpayer filed a complete and accurate original return.  
    
2. Include at the top of the first page of each amended tax return "Streamlined Domestic Offshore" written in red to indicate that the returns are being submitted under the streamlined procedures.
    
3. Complete and sign a statement on the Certification by U.S. Person Residing in the U.S. (Form 14654) certifying: (1) that you are eligible for the Streamlined Domestic Offshore Procedures; (2) that all required FBARs have now been filed (see instruction 9 below); (3) that the failure to report all income, pay all tax, and submit all required information returns, including FBARs, resulted from non-willful conduct; and (4) that the miscellaneous offshore penalty amount is accurate (see instruction 5 below). You must maintain your foreign financial asset information supporting the self-certified miscellaneous offshore penalty computation and be prepared to provide it upon request.  
    
4. Submit payment of all tax due as reflected on the tax returns and all applicable statutory interest with respect to each of the late payment amounts. Your taxpayer identification number must be included on your check. You may receive a balance due notice or a refund if the tax or interest is not calculated correctly.
    
5. Submit payment of the Title 26 miscellaneous offshore penalty as defined above.  
    
6. If you seek relief for failure to timely elect deferral of income from certain retirement or savings plans where deferral is permitted by an applicable treaty, submit:
    
   • a statement requesting an extension of time to make an election to defer income tax and identifying the applicable treaty provision;
   • a dated statement signed by you under penalties of perjury describing:
     • the events that led to the failure to make the election,
     • the events that led to the discovery of the failure, and
     • if you relied on a professional advisor, the nature of the advisor’s engagement and responsibilities.
7. The documents listed above, together with the payments described above, must be sent in paper form (electronic submissions will not be accepted) to:
   
   Internal Revenue Service
   3651 South I-H 35Stop 6063 AUSC
   Attn:  Streamlined Domestic Offshore
   Austin, TX 78741
8. Finally, for each of the most recent 6 years for which the FBAR due date has passed, file delinquent FBARs according to the FBAR instructions and include a statement explaining that the FBARs are being filed as part of the Streamlined Filing Compliance Procedures. You must file these delinquent FBARs electronically at FinCen. On the cover page of the electronic form, select “Other” as the reason for filing late. An explanation box will appear. In the explanation box, enter “Streamlined Filing Compliance Procedures.”  

Enjoy the content.

In this episode I discuss eggshell audits and what to do when it comes to filing returns for tax periods subsequent to periods under examination.