10 August, 2011

Tax Excuses 684 - 695:

684. "When I’m in the Legislature, my cash flow is really tight and I can’t be out there billing" (he was John Campbell, the President of the Vermont State Senate, and he failed to pay the property taxes on his own home) ["Vermont Senate President Pays Off $6,000 Tax Debt," Brattleboro Reformer, 8 June 2011.].

685. I took the position that tax liability does not attach until the tax return is filed, so as long as I didn't file my tax returns I had no tax liability [Matter of Arthur Heald, State of Vermont Professional Responsibility Board, PRB File No. 2004.104 (15 June 2004)].

686. "[M]y wife and I finally decided that the circumstance in Colorado was beginning to significantly damage our family's quality of life, and we arranged for moving of the contents of our Illinois house to Colorado. When the moving van arrived, because the Colorado house was much smaller than the Illinois house, the garage was literally stacked with furniture and boxes from floor to ceiling, and the financial records were not reasonably accessible or organized. For practical purposes, the records needed to prepare my 2000 tax return remained unavailable until the summer of 2002." [Schroer v. United States, 594 F. Supp.2d 1257, 1265 - 1266 (D. Colo. 2008).].

687. Based upon our low reported income, I was concerned that our tax return would be pulled if we did not take the Earned Income Credit (they had fraudulently underreported their income) [United States v. Aldridge, 561 F.3d 759 (8th Cir. 2009), cert. denied 130 S. Ct. 1095, 175 L. Ed. 2d 913 (2010).].

688. Yes, I was the president of the corporation, but I was not allowed to pay the taxes without the approval of the corporation's investors [Reppert v. IRS, 2011 U.S. App. LEXIS 6160, 2011-1 U.S.T.C. (CCH) 50,298; 107 A.F.T.R.2d (RIA) 1461 (11th Cir. 2011).].

689. I received notices from the IRS, I read them, but I just didn't do anything further with them (he failed to file Federal and state tax returns from 2002 through 2006, when his annual income was between $360,000 and $600,000) [Matter of Alexander P. Rosenberg, 82 A.D.3d 85, 918 N.Y.S.2d 20 (1st Dept. 2011).].

690. The IRS agent who audited me may have known me because she worked in the same building as I did (Taxpayer was an IRS employee who was subjected to the usual employee audit, and he failed to substantiate his deductions) [Freedman v. Commissioner, T.C. Memo 2010-155.].

691. If the IRS owes me a refund then I don't file my tax return. In 2008 my wife convinced me to file my 2005 tax return, and I was dumbfounded when the IRS reviewed the 2005 return and determined that there was a tax deficiency [Anderson v. Commissioner, T.C. Summary Op. 2011-84.].

692. "In the course of investigation, the Commissioner requested the Appellant to supply the accounting books and records of the Business covering the period from 1 April 1994 to 31 March 2001. The books and records from 1 April 1996 to 31 March 2001 were supplied but those for the two years from 1 April 1994 to 31 March 1996 were alleged to have been damaged by water and excrement, and were not made available to the Commissioner." [Hong Kong Inland Revenue Board of Review Case No. D38/10 (14 January 2011).].

693. Our basement flooded and my wife mistakenly threw out a soaked box of papers which contained our financial records for our 1985 tax return. When my wife realized this, she didn't tell me because she didn't want me to be angry with her, so she just blocked it out of her mind. When it came time for her to do the 1986 taxes, the tax preparer asked her for our 1985 tax return, which did not exist, so she walked out of the tax preparer's office and blocked it out of her mind. The same thing happened with our 1987 taxes. When my wife finally told me, it caused an immediate and severe family crisis, and the family remained traumatized for over two years [Attorney Grievance Commission v. Gavin, 350 Md. 176, 711 A.2d 193 (1998).].

694. I was, in essence, a Rent-a-CEO brought on to facilitate the liquidation and reorganization process the firm. My role was merely that of a figure-head, employed by the venture capitalists spearheading the reorganization so that it appeared as though the Company had a Chief Executive Officer. I signed the Corporate Tax Returns for convenience purposes only [Layne v. Michigan Dept. of Treasury, Michigan Tax Tribunal, Docket No. 383266 (28 June 2011).].

695. "Ms. Brown cites to a litany of events that occurred between September 10, 1996 and April 2001. Specifically, Ms. Brown points to her difficult pregnancies, the serious medical issues suffered by her children and her grandmother (who lived with Ms. Brown), the supposed interference by the Ocala Police Department in the operation of Safe-Deposit, the supposed malpractice by the law firm she hired to file suit against the Ocala Police Department, the late payments by Safe-Deposit's clients, and the fact that she cannot remember the IRS ever advising her of the penalties for not paying the trust fund taxes as proof of the undue hardships she suffered which prevented her from paying the trust fund taxes." [Brown v. United States, 769 F. Supp. 2d 1355 (M.D. Fla. 2011).].

18 May, 2011

Tax Excuses 662 - 683:

662. "My decision to quit paying the tax was made in 1992, not before, and was the result of a letter sent, asking for the basis for their taxing me which received a reply after about 3 months, which was no answer to my question, but simply stated to ignore any correspondence received from them until I received an answer." [Goldston v. Commissioner, T.C. Memo. 2011-9.].

663. "In pressure to close case we agreed under duress due to the fact the team leader stated that we would not receive abatement of penalties and simple interest calculation if we did not agree to a taxable amount of 68%" (they failed to keep adequate records so the Department of Taxation & Finance did an audit and observation) [Matter of Mamma Rosa's Cucina Corp., New York State Div. of Tax Appeals, Docket No. DTA 823759 (13 January 2011).].

664. "Petitioner contends that his heart condition, attention deficit disorder, and decreased earnings constituted reasonable cause for his failure to timely file returns and pay taxes." [Pushman v. Commissioner, T.C. Summ. Op. 2011-6.].

665. My sisters argued with me over the decisions for my mother's health care and had a restraining order prohibiting me from contacting my mother. I had business problems and had problems finding work in a new field on account of my age and the restraining order [Eckardt v. Commissioner, T.C. Summ. Op. 2011-13.].

666. Our daughter was extremely ill and was giving birth to a child at the time our tax return was due, and caring for her was so time consuming that we didn't file our tax return on time [Campbell v. Commissioner, T.C. Memo. 2011-42.].

667. I didn't know that my federal taxes were due, and I have had a life-long problem with identity theft [Matter of Anonymous, Defense Office of Hearings & Appeals, ISCR Case No. 09-06388 (2 December 2010).].

668. The reason I owe money to the IRS is because I understated my taxes on my income tax returns [Matter of Anonymous, Defense Office of Hearings & Appeals, ISCR Case No. 08-11772 (8 December 2010).].

669. "[Applicant] did not file his 2003 income tax returns because he was unsure of how much money he would need in the future. … He explained he did not file returns and pay his taxes because he believed that his business would become successful and then it would be easier to pay the debts." (he had spent $50,000 on a home renovation project during this time) [Matter of Anonymous, Defense Office of Hearings & Appeals, ISCR Case No. 10-02780 (20 January 2011).].

670. My employer is a private corporation organized under the laws of Delaware and has no connection with the United States government [Fennel v. Commissioner, T.C. Summ. Op. 2011-19.].

671. My failure to file my personal tax returns and business withholding taxes from 2001 to 2005 was not willful because I had an installment agreement with the IRS (The respondent, a CPA who prepared tax returns for others, was was ineligible for an installment agreement, and was disbarred from practice before the IRS) [Office of Professional Responsibility v. Edwin Davis, Jr., U.S. Treasury Office of Professional Responsibility, Complaint No. 2007-35 (20 February 2008), aff'd, Dept. of Treasury Office of Chief Counsel, March 10, 2009.].

672. "Petitioner, in its petition, claims that the notices were not timely protested because the corporation’s president lacks both an understanding of the English language (speaking and reading) and the knowledge of the importance of responding to correspondence from the government or its agencies" Matter of ZW Deli & Grocery Corp., New York State Div. of Tax Appeals, Docket No. DTA 823643 (3 March 2011).].

673. My client shouldn't have to pay the tax on the distribution from his deceased father's IRA account because his mother killed his father, and she should be the one to pay the tax [D.N. v. United States, 625 F.3d 1222 (9th Cir. 2010).].

674. The 10% delinquency penalty of $551,011.88, which was assessed by Stanislaus County because San Francisco County did not timely return our erroneous payment to it in time to pay Stanislaus County, was an unfair windfall to Stanislaus County [ZC Real Estate Tax Solutions Ltd. v. Ford, 191 Cal. App. 4th 378, 119 Cal. Rptr. 3d 85 (Cal.App., 2010).

675. The aggregation of the two apartments is an affront to a married woman’s right to enter into transactions and have sole ownership over property as though she were unmarried (The couple had purchased a Manhattan luxury co-op residential apartment consisting of two connected units, purchased at same closing at same time, which, when aggregated together, exceeded $1 million threshold and thereby became subject to New York's so-called "mansion tax"). [Matter of Michael & Frances Sacks, N.Y. State Tax Tribunal, Decision DTA No. 822322 (10 March 2011).].

676. "I am now 71 years old and live in Thailand. My only source of income is Social Security. Thailand is the only place I can afford to live on my income." [High v. Commissioner, T.C. Summ. Op. 2011-36.].

677. The money I received from my freelance photography business was pay for work outside the scope of the Internal Revenue Code and relevant Alabama tax law [Richards v. State, Alabama Dept. of Revenue, Admin. Law Div., Dkt. No. INC 10-1133 (30 March 2011).].

678. We shouldn't be liable for sales tax collections on our cover charge because most of our patrons only listen to the music but they do not dance [Matter of Anonymous, Washington Department of Revenue, Appeals Div., Determination No. 09-0311, 30 WTD 1 (2011).].

679. When we changed our primary bank we didn't properly change the electronic funds transfer arrangements [Indiana Dept. of State Revenue, Letter of Findings No. 04-20100701P, Indiana Register, 20110427-IR-045110244NRA (27 April 2011).].

680. The IRS had no right to keep our Economic Stimulus Act rebates and apply them to our back taxes because the compromise agreements between us and the IRS for our past delinquent taxes were written in colloquial English, and were not intended to cover the technicality of the Stimulus Act's tax rebates. For example, the agreement allows the IRS to "keep any refund" even though, in technical Code jargon, the IRS does not "keep" refunds [Maniolos v. United States, 741 F. Supp. 2d 555, 569 - 570 (S.D.N.Y. 2010).].

681. The federal income tax constitutes an enslavement of individuals in violation of the Thirteenth Amendment of the United States Constitution. [Allamby v. United States, 2010 U.S. Claims LEXIS 7, 2010-1 U.S.T.C. (CCH) 50,188, 105 A.F.T.R.2d (RIA) 664 (Fed.Cl., No. 09-868C, 21 January 2010).].

682. I filed the decedent's Estate Tax return late because I couldn't sign it on the due date because I wasn't sure all of the Estate assets had been discovered and properly valued [Estate of Cederloff v. United States, 2010 U.S. Dist. LEXIS 94523, 106 A.F.T.R.2d (RIA) 6292 (No. 8:08-CV-02863, D. Md. 10 September 2010).].

683. My sales tax problems with the State of Michigan were because someone from Mobil Oil said that I could better compete as an independent station by cutting expenses and not paying sales tax, and that Mobil would pay the tax [United States v. Safiedine, 2010 U.S. Dist. LEXIS 110333 (No. 06-20137, E.D. Mich., 18 Oct. 2010).].

03 January, 2011

Tax Excuses 634 - 661:

634. The penalty for assessed on us was a heavy burden for a struggling business [Anglo Persian Emporium Trading Co., Ltd. v. Her Majesty's Revenue & Customs (No. TC00584, Appeal number LON/2008/1444, [2010] UKFTT 296 (TC)
1st Tier Tribunal, London, 1 July 2010).].

635. I had sold a business, spent all the proceeds of sale and had no money left to pay the unexpected tax bill [Neil Clarke v. Her Majesty's Revenue & Customs (No. TC00603, Appeal number TC2009/16834, [2010] UKFTT 316 (8 July 2010).].

636. My employer used the wrong tax code rate (his tax return was filed nearly a year past the due date) [Stuart Griffiths v. Her Majesty's Revenue & Customs (No. TC00653, Appeal number TC/2010/02166, [2010] UKFTT 371 (TC) (10 August 2010).].

637. The merger of our parent corporation with the Lorillard Corporation caused abnormal conditions and business problems, had a substantially adverse effect on personnel, and necessitated additional time being spent in combining procedure, tax calendars, and files in order to develop a systematic and effective work pattern for our tax department [Appeal of Loew's San Francisco Hotel Corp., California State Board of Equalization, SBE-XIX-193,73-SBE-050 (17 September 1973.).].

638. When I let my partner withdraw $100,000 from the business he agreed to pay the taxes [Illinois Dept. of Revenue v. John Doe, Illinois Dept. of Revenue Office of Admin. Hearings, Dkt. No. ST 10-05 (2 April 2010).].

639. The controller we had at that time had failed to accurately reconcile the cash against the general ledger in such a way so that we could tell that we had missed the payment [Illinois Dept. of Revenue v. ABC Sales and Service, LLC, Illinois Dept. of Revenue Office of Admin. Hearings, Dkt. No. ST 10-09 (24 May 2010).].

640. I owe no tax because I have rendered all tribute that the scripture, commonly referred to as the Holy Bible, requires me to render [Glover v. Commissioner, T.C. Memo. 2010-228, n. 9.].

641. As we were preparing for our acquisition of Texaco, we had problems with our new computer system, and we had difficulties in hiring and retaining qualified personnel in our Tax Department and Computer Operations Department [Matter of Getty Terminals Corp., N.Y. State Tax Tribunal, Decision DTA No. 810743 (17 November 1994).].

642. I was taking care of my sick mother, and I also suffered injuries while playing football for the Oakland Raiders [Matter of the Trace R. L. Armstrong, California State Board of Equalization, No. 474197 (23 February 2010).].

643. The tax return was hidden by a misplaced file on a desk and we therefore thought the return was filed when it was not [Matter of Purdue Regency Apartments, California State Board of Equalization, No. 495740 (13 July 2010).].

644. The employee who was supposed to file the gross product returns left her employment, and we had a staffing shortage on account of declining oil prices [Matter of The Termo Company, Wyoming State Board of Equalization, No. 2000-77 (11 August 2000).].

645. "I appeal to you to waive the tax penalty, as this year has been quite a financial struggle for me. No only was my 13th month salary halved, but there was also no profit share and this year my company has requested me to take 4 weeks unpaid leave. With all my prior commitments this year I am finding it very hard to meet these financially." (He understated his income on his tax return). [Hong Kong Inland Revenue Board of Review Case No. D59/09 (19 March 2010).].

646. We have been suffering from financial hardship due to the recession. The federal and state governments have an express policy of helping small businesses, of which we are one. Affirming the lateness penalties on our sales tax return and payment will cause us further hardship, while the waiver of these additions will further the governmental policy of aiding small businesses by helping us survive the recession. [West Virginia Office of Tax Appeals, Decision Nos. 09-039 C & 09-072 C (4 February 2010).].

647. When responsibilities for filing our Washington State tax returns transitioned from our home office in Oakbrook, Illinois, to its accounting center in Columbus, Ohio, the payment due date was inadvertently changed in our computer system from the 21st of the month to the to the 25 th of the month [Matter of McDonald's Restaurants of Washington, Inc., Washington Board of Tax Appeals, No. 64482 (13 March 2007).].

648. My wife, who was the business bookkeeper, had side effects from her surgery and her use of valium, so after she prepared the tax returns she just stuck them in her desk instead of filing them [Gargalianos v. Commissioner, Massachusetts Appellate Tax Board, Docket Nos. 167936-939 (18 January 1995).].

649. We didn't withhold and pay over the subcontractor's taxes because the subcontractor was the owner's son, the relationship between father and son in a contractor-subcontractor relationship is unusual, and it caused us to not properly to consider matters as we would have had we engaged someone outside the family as subcontractor [Michael Mitchell v. Her Majesty's Revenue & Customs (No. TC00745, Appeal number TC/2009/10865, [2010] UKFTT 485 (TC) (11 October 2010).].

650. The funds withdrawn from my bank account in Ireland arrived late, and then, when I sent the check to my accountant so that he could pay Her Majesty's Revenue, he left for Malaysia [John Dignam v. Her Majesty's Revenue & Customs (No. TC00777, Appeal number: TC/2010/06114, [2010] UKFTT 522 (TC) (28 October 2010).].

651. "I admit when we came last time we bought tobacco. It was such a good deal we decided to go again." (The automobile was seized for evasion of customs duties) [Hitesh Desai v. Her Majesty's Revenue & Customs (No. TC00845, Appeal number: TC/2010/01211, [2010] UKFTT 595 (TC) (24 November 2010).].

652. The company's records were destroyed in a flood of the Grand River, but I didn't really function as an officer of the company; I just put my name down as the President as part of my usual practice for organizing the investment units of my client [Ross v. Levin, Ohio Bd. of Tax Appeals, No. 2007-M-117 (14 July 2009).].

653. I didn't file during the tax amnesty period because I thought that, based upon what I thought I owed, the penalties under the tax amnesty would be greater than the ordinary penalties for not filing [Doss v. Levin, Ohio Bd. of Tax Appeals, No. 2008-M-725 (14 September 2010).].

654. We should be exempt from the Sales & Use Tax because the University of Minnesota Veterinary Hospital doesn't pay them and the Minnesota Legislature never intended to give them a tax break for services that compete with a private sector veterinary clinic [Veterinary Radiation Therapy Clinic v. Commissioner, 2010 Minn. Tax LEXIS 35 (No. 7906-R, Minnesota Tax Ct., 29 November 2010).].

655. We don't approve of the way the government is spending our tax money. It would be better if our economy would collapse than to try to save the World Bank or the IMF [Matter of Anonymous, Dkt. No. 21375, Idaho State Tax Comm. (8 June 2009).].

656. "The people that would have any information regarding this ridiculous tax issue are my grandparents and father. None of which will return my phone calls or help me find a way to prove that I don’t owe any money. I have no clue how to get a hold of any paperwork that will prove my point. … I am a full time student paying for school out of my own pocket. This is a hugely unnecessary headache in my life." [Matter of Anonymous, Dkt. No. 21275, Idaho State Tax Comm. (12 June 2009).].

657. The money garnished from my paycheck should have been be applied towards my taxes that year (it was applied towards prior years' delinquent taxes) [Dillard v. State, Alabama Dept. of Revenue, Admin. Law Div., Dkt. No. NC. 10-514 (18 November 2010).].

658. In the business owner's previous enterprises he was not significantly involved in collecting sales taxes or filing the tax returns with the Department of Revenue, and his misunderstanding was compounded by his medical condition, which made it difficult for him to understand things that would be readily apparent to others [Matter of Anonymous, Washington Dept. of Revenue, Determination No. 10-0125, 29 WTD 90 (21 April 2010).].

659. My accountant had to curtail his practice because his mother died, and then I had to take care of my ailing father, and I was stressed by the terrorist attack on September 11, 2001 [Verduzco v. Commissioner, T.C. Memo. 2010-278].

660. We shouldn't be liable for the Service Tax because we operate on a "No Profit, No Loss" basis and only recover the cost from the licensees (the Service Tax is imposed irrespective of profit or loss) [M/S RPG Enterprises Ltd v. Commissioner of Central Excise, 2008-TIOL-643-CESTAT (W. Zonal Bench, Mumbai, 4 April 2008).].

661. I had health problems, and, after the federal government suddenly shut down my employer due to questionable business practices at the end of 1998, I was busy looking for work but there were no jobs available. My tax obligations were not a priority as I was focused on trying to survive [Matter of the Appeal of Boxer, California State Board of Equalization, No. 474201, 13 July 2010).].