The Endangered Species List
ectopistes migratorius), died at the Cincinnati Zoo. On September 7, 1936, "Benjamin," the last Tasmanian tiger (thylacinus cynocephalus), died at Australia's Hobart Zoo. And on June 24, 2012, "Lonesome George," the last living Pinta Island tortoise (chelonoidis nigra abingdoni), died in Ecuador's Galapagos National Park.
On September 1, 1914, "Martha," the last remaining passenger pigeon (
When you think of endangered species, you naturally think of plants and
animals. But the IRS has its own endangered species list (called "listed transactions"),
and that means sometimes even tax strategies go extinct. So, for
example, in October, 2006, the last grandfathered private annuity trust
was formed. On April 10, 2007, most so-called "Section 419(e)" plans
were shot down. Now, could the venerable Swiss bank account (bankum secretus strongius) be next?
Switzerland's banking laws have long made it a crime to reveal an
account holder's name. At the same time, Swiss authorities have
historically refused to cooperate with foreign countries where failure
to report taxable income is concerned. Together, these policies made
Switzerland the banker of choice for Colombian druglords, Sub-Saharan
kleptocrats, Russian oligarchs, and even the so-called "Wolf of Wall
Street," Jordan Belfort.
But recently those protections have melted away like so much Swiss
chocolate sitting in the bright alpine sun. It started back in 2008 when
Bradley Birkenfeld, a mid-level banker, blew the whistle on helping
American taxpayers "forget" to report millions of dollars of interest
income. Birkenfeld's bombshell landed him a 40-month prison sentence and
a $104 million reward from the IRS. A year later, the Department of
Justice fined the biggest Swiss bank $790 million and cut a deal with
the Swiss government, giving them power to force their banks to disgorge
information on American depositors almost on demand. In 2012, an even
stronger settlement required 300 Swiss banks to identify their American
account holders or face their own penalties. Most recently, "Beanie
Babies" creator Ty Warner pled guilty to evading $5 million in tax and
agreed to a $53 million fine — and still faces four years in jail.
And now? Well, some observers say that Swiss banks are actually doing
the IRS's job for them. Better to rat out clients than pay IRS fines!
Banks are pressuring Americans to report their accounts, and even
freezing accounts unless clients can prove they're playing by the new
rules. U.S. attorneys are generally advising clients with secret
accounts to 'fess up now before the IRS finds them and penalizes
them 50% of their balances. At this point, attorneys say, discovery is a
matter of "when," not "if." That message appears to be hitting home.
Since 2009, over 38,000 Americans have come forth and paid over $5 billion
in taxes, penalties, and interest. The once-celebrated Swiss bank
account appears headed the way of the dodo, as far as U.S. tax cheats
are concerned.
Look, we understand that everybody wants to pay less tax. But there's a
right way to do it and there's a wrong way to do it. The right way is to take advantage of hundreds of legitimate deductions, credits, and strategies contained in the tax code and treasury regulations. And it all starts with a plan. We can give you that plan, and it doesn't involve a trip to Zurich or Geneva to visit your money. So call us now to see how much you might be overpaying. And if you really like cuckoo clocks, fine watches, and yodeling, you can take a legitimate trip with the savings!
James E. Mahoney, EA
228 E. Walnut St. Suite A Galion, OH 44833 (419) 468-8509 www.taxmattersrepresentation.com |
Tuesday, January 28, 2014
The Endangered Species List
Tuesday, January 14, 2014
Test Your Tax Knowledge
They say that knowledge is power, and that's especially true with taxes.
So here's a quick quiz to test your tax knowledge in 2014. But look out
— the questions (and the answers) might not be what you expect!:
We'll start with an easy one. Last year's "fiscal cliff" legislation raised the top marginal tax rate to 39.6%. What's the top effective rate?
Give up? It's a trick question — all three answers can be correct, depending on your own circumstances!
Alright, let's shift gears a bit. The tabloids love running stories
about celebrities who run into tax trouble. After all, if they make so
much money, shouldn't they be able to afford their taxes? So here's our
next question — which of the following sets of celebrities ran into tax
trouble in 2013?
Well, which did you pick? The answer is, another trick question — every single one ran into tax problems last year!
Okay, final question. We know that tax laws can be impenetrably dense
and hard to understand. So maybe "context" will give you a hint. Which
of these passages is taken from the 2013 fiscal cliff act, and which is
taken from California's workers' comp regulations?
Drumroll, please . . . the answer is, it's another trick question
— both examples of sterling prose appeared in the fiscal cliff law!
(Quit complaining about the trick questions — it's a tax quiz, after all!)
Don't be upset if you didn't get all three questions right. (Nobody else
did, either!) Fortunately, there isn't any real money at stake. But
that won't be true come April 15. So call us now for the plan you need to come up with the right answers in 2014!
James E. Mahoney, EA
228 E. Walnut St. Suite A Galion, OH 44833 (419) 468-8509 www.taxmattersrepresentation.com |
Wednesday, January 1, 2014
Resolutions We'd Like to See
Resolutions We'd Like to See
As for us, we're resolving to bring you even better, more proactive tax advice. That process starts with a comprehensive plan
to take advantage of every deduction, credit, and strategy you legally
deserve. If you don't already have one, maybe you should make getting
one your resolution for 2014!
James E. Mahoney, EA
228 E. Walnut St. Suite A Galion, OH 44833 (419) 468-8509 www.taxmattersrepresentation.com |
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