Many taxpayers have relatively simple tax returns and don’t require the services of a CPA or tax attorney with the experience of our team. However, tax compliance continues to be complex, and for taxpayers who have diverse assets or significant financial or business activity, it is a valuable component of a “wealth plan” to work with tax advisors of our caliber. Anyone who owns a business, has real estate investments, is self-employed, has significant investment assets, is experiencing a major life event, is buying or selling a business, or otherwise has a complicated portfolio of assets should engage an experienced tax CPA or attorney to prepare their tax return annually.

The IRS now works with ID.me, a third party, to facilitate the authentication process prior to accessing tax records and information. Although ID.me provides information on its security page about its security protections and the different security audits and assessments it conducts, we understand the concern. Unfortunately, risk cannot be completely eliminated—it must be managed. Is there some risk associated with e-filing? Yes, but there is also risk to filing a return by mail, which we think provides a greater risk to security plus greater exposure to issues with the IRS and state taxing authorities. With e-filing, we confirm the filing and receipt of a tax return, facilitate a faster processing of a return, and sometimes can identify cases of identity theft.

Yes, if you own a business, own rental property, are self-employed, have significant investment assets, are experiencing a major life event, or otherwise have a complicated portfolio of assets. We review tax-saving opportunities during the tax return preparation process—and that often has a positive impact—but ideally, tax planning should be addressed throughout the year, and be a fundamental part of your financial planning. We often coordinate with clients’ financial advisors and hold quarterly (or less frequent) reviews to assess the tax planning opportunities before the year ends.

As investing in these forms of financial assets has increased, scrutiny by the IRS has increased as well. The IRS defines a digital asset as “any digital representation of value that is recorded on a cryptographically secured distributed ledger or similar technology.” This includes cryptocurrencies, stablecoins, and non-fungible tokens. If you sold, disposed of, or earned cryptocurrency during the year, you will have to report income and capital gains (or losses) on your tax return. You will also be required to answer a question on your federal tax return about whether you have transacted virtual currency or digital assets during the year. Failure to answer this question accurately can lead to significant penalties.

Yes, absolutely. A tax attorney or CPA will protect your interests, manage the IRS’ examination of your return and related accounts and financial information, negotiate audit issues on your behalf, seek to minimize any tax or penalties that may be due (or work to increase an overpayment), and provide you with options throughout the audit process.

As funding to the IRS has increased, the IRS has stated it will focus on tax examinations of high-income and high-net worth individuals, large corporations, and complex partnerships. The IRS also plans to acquire improved technology (including artificial intelligence), automation, and other tools to streamline its processes. It continues to apply data analytics to manage and select cases. We expect the entire process of tax examinations to change over the next several years. We also expect improved processes for correspondence and response times to basic IRS notices and taxpayer communications.

Yes. There are numerous considerations when you and your spouse decide to separate or divorce.  Factors include filing status, tax considerations for the type of assets being divided, tax reporting consequences if you have dependent children, tax return reporting for the year of separation (including the allocation of income and deductions), tax considerations with respect to spousal maintenance, continued co-ownership of certain kinds of assets, and consequences from the sale of real estate. We often collaborate with family law attorneys to address these important matters, to seek the best possible outcome for our client.

The IRS and state taxing authorities require that income tax be paid throughout the year. Most employed persons meet this obligation through the income tax withheld from their paycheck. When someone retires and no longer has earned income, it’s necessary to make estimated tax payments directly to the IRS or state taxing authority throughout the year. The payments can be based on your prior year tax or on an estimate of your current year tax, and are due on four separate dates. For federal estimated tax payments, the due dates are April 15^th, June 15^th, September 15^th, and January 15^th of the following year.  State tax payments are typically due on the same dates.