April, 2008

Message from Nelson & Company, P.S., CPAs

Tax Rebates---On the way!

The Government has begun sending rebate checks. They will continue to be sent through December 2008, so an extension will not cause you to lose your rebate.

Certified Public Accountants

IRS Times & Inquirer

Inside This Issue...

CA Man Gets 2 Years and a Bill for $1.16m
Crime doesn't usually pay...but if it does, you had better pay the taxes.
IRS Question Corner

CA Man Gets 2 Years and a Bill for $1.16m

A CA chiropractor has been sentenced to two years in federal prison and ordered to pay $1.16 million in restitution for tax evasion.

Ramon Reynoso, 45, of Castro Valley, CA, pleaded guilty to one count of tax evasion. According to the plea agreement, Mr. Reynoso admitted that from 1991 to 2004, he was self-employed at his chiropractic business in Hayward, CA. He agreed that his taxable income for services from 2000 to 2003 was $3.18 million and the tax due and owing on that income was $1.16 million.

Reynoso admitted that he had last filed his personal federal income taxes for the calendar year 1996, and despite earning a significant income during the calendar year 2001, he willfully failed to file his federal income taxes and took a number of affirmative acts to willfully attempt to evade and defeat this income tax due and owing to the United States, including placing assets in nominee accounts, using the Zeus Trust to conceal his receipt of income, and opening bank accounts with false Social Security numbers.

Crime doesn't usually pay...but if it does, you had better pay the taxes.

A San Francisco woman was sentenced to 20 months in prison, to be followed by three years of supervised release, for her involvement in an embezzlement scheme and for filing a false tax return. Suzie Moy Yuen, 53, of San Francisco, CA, pleaded guilty to mail fraud and willfully subscribing to a false tax return. According to the plea agreement, Yuen served as an executive assistant to an individual for over ten years. The victim, who is now 99 years old, had given Yuen signature authority over two of his checking accounts. From 1999 and 2003, Yuen fraudulently used the victim's checking accounts to pay her own bills and made false entries in the general ledger to conceal her fraud. Yuen admitted to embezzling more than $1.4 million.

Yuen also admitted that she failed to include in her tax returns the income she had embezzled from her employer.

In particular, Yuen omitted from her 1999 return about $127,000 she had stolen from the victim during that year. Yuen similarly failed to report her embezzled proceeds for each of calendar years 2000 through 2003, resulting in a total of approximately $1.4 million in fraudulent income. In all, Yuen owed the IRS, excluding interest and penalties, a total of $492,646.

IRS Question Corner

Question: Help! After a successful business that went under unexpectedly, and some bad tax advice in the past, Iím stuck with a six-figure tax bill ó and no way to pay it. What are my options?

Answer:  I know how difficult this time is for you. Having a large tax bill looming over you is among the most difficult things to face. Financial uncertainty can be crushing.

But you have options. And know this: You are not alone. Thousands of American taxpayers just like you have found themselves in trouble with the IRS. They got out that trouble.

And you can, too. The first thing you should do it consult a qualified tax professional. He or she will analyze your return with a fine-tooth comb to make sure you're not obligating yourself to pay even a penny more than you owe. Once you and your tax professional have determined your exact tax debt amount, it's time to meet with an IRS agent.

You may qualify for what is known as the Offer in Compromise program. If you have amassed a large tax debt but, due to current situations, are unable to pay that debt down, you may be able to negotiate a settlement amount with the IRS that amounts to pennies on the dollar. This program is meant to allow indebted taxpayers to come into compliance with the law under mutually agreeable circumstances.

Another option is the Installment Agreement. If you can pay your tax debt, but only over a period of time, you and the IRS may enter into an agreement that would let you pay down your debt just like you pay down a car loan.

For a free, no-risk consultation, please call my office at 253-752-9522 or send me an E-mail at Firm@DNelsonCPAs.com. Do it today!


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