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Articles Houston Tax

Are Funds Advanced to Third Party Subject to Tax?

With a cash basis taxpayer, the general rule is that the taxpayer recognizes gross income when money is received. But what if the taxpayer holds money on account for others? This is a common practice. These transfers may include deposits, advances, etc. It can even include funds held in trust for the benefit of a…Continue…Continue readingAre Funds Advanced to Third Party Subject to Tax?

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Articles Houston Tax

Failure to Review Tax Return Voids Penalty Defense

The IRS is quick to impose penalties. Many penalties are automatically imposed by the IRS’s computers. Even on audit, the IRS’s leadsheets direct IRS auditors to consider penalties before closing the audits. Most penalties can be abated if the taxpayer can establish reasonable cause. This is a facts and circumstances analysis. The courts have accepted…Continue…Continue readingFailure to Review Tax Return Voids Penalty Defense

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Articles Houston Tax

Using an Old NOL Carryforward

The things we take for granted these days. If you are younger than me, you may not realize it but there was a significant change that happened in the 1990s. Personal computers were just starting to actually be useful in the workplace. The ability to type and use a 10-day calculator were sought after job…Continue…Continue readingUsing an Old NOL Carryforward

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Articles Houston Tax

Tax Debts & the Dissipated Asset

It is very difficult to run a business and to do so in full compliance with all of our laws. Having worked with thousands of business owners, the message is the same. Something always seems to give. If the business focuses on the operational side of the business to comply with industry regulations or to…Continue…Continue readingTax Debts & the Dissipated Asset

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Articles Houston Probate

Probate After a Muniment of Title

Muniment of title is an alternative to the probate process in Texas. It is cost-efficient.  It is fast–relatively speaking. A Will is required. Instead of appointing you as the executor, the probate court enters an order distributing property according to the Will. And walla! But what if the story does not end there? What if…Continue…Continue readingProbate After a Muniment of Title

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Articles Houston Tax

Avoiding Tax Penalties for Bookkeeper’s Mistakes

Taxes are computed based on accounting records. Accounting records are often complied by bookkeepers who have no tax training or experience. The bookkeepers may not intend to provide tax advice. Their work product may be used to prepare tax returns, however. The tax return preparer may move the numbers from the bookkeeper’s profit and loss…Continue…Continue readingAvoiding Tax Penalties for Bookkeeper’s Mistakes

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Articles Houston Tax

How to Challenge Payroll Taxes

Payroll tax disputes can be more difficult to resolve with the IRS than some other types of taxes. This is largely due to the IRS’s notice of deficiency process. The IRS’s notice of deficiency is the final notice the IRS sends before it assesses or records a tax as being due. The notice is required…Continue…Continue readingHow to Challenge Payroll Taxes

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Enough is Enough, But An Amended Tax Return is Not

The process for reporting taxes can be more difficult than discerning whether a tax provision applies. This complexity stems from the level of information is required to be reported. The IRS reporting requirements continue increase every year. The IRS’s decision to require partnership tax capital accounts is an example. Why is that information required and…Continue…Continue readingEnough is Enough, But An Amended Tax Return is Not

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Articles Houston Tax

Fixing Self-Directed IRA Errors

There are ways to structure transactions to avoid income taxes. Creative taxpayers and tax attorneys have used qualified retirement accounts for this purpose (the tax savings from ESOPs is an example). One has to be careful when structuring transactions involving these qualified plans. Given the flexibility in the rules and the absence of financial advisors,…Continue…Continue readingFixing Self-Directed IRA Errors

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Articles Dallas Probate

Probate & Below Market Rental Property

The “too good to be true” lease. It’s the month-to-month lease agreement for a friend. It’s the lease that charges below-market rent. What happens to the real estate subject to this type of lease when the owner dies? What should you do if you are the personal representative and this property is part of the…Continue…Continue readingProbate & Below Market Rental Property