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Manhattan Tax Law Blog

Rumors of low audit rates exaggerated

Article after article on the Internet states that the odds of a federal audit by the Internal Revenue Service (IRS) are extremely low. Unfortunately, these stories overestimate the rate of audits conducted by the IRS.

The stories often quote the follow statistic: only “one out of 143 tax returns are audited every year.” If true, this translates to an audit rate of approximately 0.7 percent. Or, as noted in a recent piece by Accounting Today, a 1:23 chance of getting audited.

Quarterly tax filers beware: Double the bill & headache in April

Those who choose to pay their taxes in quarterly installments will face double the bill, and double the headache, on April 17, 2018. Why? In addition to paying for the final quarter of 2017, you will also need to pay the Internal Revenue Service (IRS) for the first quarter of 2018.

The timing is not new, why double the headache? The new tax law makes the payment for the first quarter of 2018 particularly difficult. The exact impact of the law is not yet fully known and the Treasury Department and Internal Revenue Service (IRS) continue to issue notices in an attempt to provide guidance.

Millennials are making these three tax mistakes

Long stereotyped as the generation too coddled to leave home, Millennials are finally growing up as they as they gain employment, pay rent, buy homes, get married and have kids. That is to say: they're making adult decisions and contributing to the economy in new ways as Baby Boomers retire; and, as Millennials come of age, they face the rite of passage that is paying taxes.

Although Millennials are tech-savvy and well-educated, they aren't immune to making mistakes on their tax returns just as generations in the past. But, with every new generation comes new considerations when matching lifestyles to tax reporting requirements. If you are a Millennial, what should you watch out for when filing your taxes?

New York state income taxes could change too

The Tax Cuts and Jobs Act of 2017 is set to bring on many changes. Not only will the taxes you pay to the federal government change, but your state taxes could change too as the gears of federalism shift in response. What changes are in store for New York?

According to 24/7 Wall Street, New York residents have the highest taxes compared to all other states. This notion was furthered by Governor Andrew Cuomo who said that the federal tax law "targets" states like New York by capping state and local tax deductions, also known as the SALT provision, at $10,000. In response, Cuomo has proposed giving employers the option to collect a five percent payroll tax to replace the state income tax on workers.

Three ways the tax law impacts pass-through entities

There’s no question that the Tax Cuts and Jobs Act of 2017 will have a wide-reaching impact on businesses and families of every type. You might understand a few aspects of the new law, but determining exactly what is in the law and how it will impact your bottom line may be difficult to determine until tax time next year.

How the tax law will affect your business depends on the structure of your organization, where you do business and what products you sell. Entities that will experience big changes are businesses that classify themselves as pass-through organizations including S corporations and LLCs.

Don't lie on your tax returns

According to the Statistic Brain Research Institute, 1.6 million people cheat on their tax returns every year, resulting in $270 billion in lost revenue to the IRS. While you are allowed to use tax planning strategies to reduce your tax burden, outright dishonesty like misrepresenting your income can result in criminal charges. Because the IRS loses billions in false tax returns, they have a lucrative incentive to pursue the people who submit them. What can you do to ensure that you are doing the right thing on your tax return?

Benjamin Goldburd recognized in ASLA's Top 40 Under 40

Benjamin Goldburd Esq., a partner at Goldburd McCone LLP has been recognized as one of the Top 40 Under 40 Tax Lawyers in the State of New York by the American Society of Legal Advocates (ASLA).

The society is an invitation-only, nationwide organization founded with the central purpose of identifying and promoting only the most outstanding legal talent throughout the country. Benjamin's selection was the culmination of a multi-stage process in which a team of ASLA lawyers devoted themselves to scrutinizing tens of thousands of legal professionals before deciding to include him in the listing.

Your passport can be revoked for unpaid taxes

Everyone knows that the logistics of international travel are complicated. From packing enough for your time away, to a long flight overseas, to the customs process and your passport - everything has to work in sync for your trip to be a success. However, if you have unpaid taxes, your trip overseas could get a little more complicated.

The IRS recently announced that individuals and business owners with more than $50,000 in unpaid taxes could have their passports revoked or denied by the U.S. State Department.

IRS scores victory over cryptocurrency trading platform

After a year-long battle in court, the Internal Revenue Service (IRS) has notched a victory over Coinbase, a leading cryptocurrency exchange headquartered in San Francisco. The Nov. 28 federal court ruling ordered that the company turn over the identities of more than 14,000 of its users.

The decision was a triumph for the IRS, who had claimed that only a small portion of digital currency owners acknowledged their holdings in their tax filings.

Will changes in IRS examinations affect you?

A famous New York rapper once said that he had “more money, more problems.” Is this notion actually true? When it comes to your tax returns as a high-income earner, it just might be. As the 2017 fiscal year came to a close, the IRS announced that it is changing the way it examines tax returns and wealthy taxpayers are expected to be most affected. Let’s look at the reason for the change and how you can potentially avoid trouble.

Why did the IRS change examinations?

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