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November, 2012

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

TAX LAW CHANGES - We're still waiting.

This month's newsletter is late because we were hoping to provide you with news about pending tax law changes.

As of this date, Congress has not acted and is still battling with the White House over tax rates and deductions.

Of greatest concern is the extension of the Alternative Minimum Tax (AMT) exemption. Should it not be extended, average tax payers will see additional taxes of $2,000 to $3,000.

We don't think there will be any actual changes to tax laws enacted until the very end of December. As soon as something is settled, we will send out a special bulletin.

David S. Nelson, CPA, CTRS
Certified Public Accountants

IRS Times & Inquirer

Inside This Issue...

Former N.Y. Senate Leader Pleads Guilty to Tax Fraud
Firefighter Faces 30 Years in Prison for Federal Tax Charges

Former N.Y. Senate Leader Pleads Guilty to Tax Fraud

The former New York State Senate majority leader pleaded guilty to filing a false and fraudulent federal tax return for the year 2005.

Pedro Espada Jr. concealed money he took from Soundview Healthcare Center, where he was CEO and president, through a janitorial company he owned. Espada also defrauded the IRS of taxes owed on income he earned from the sale of a property on Leland Avenue in the Bronx by claiming that it was his primary residence. In fact, Espada lived in Mamaroneck, in Westchester County, while renting out the Bronx property.

Espada faces up to 43 years in prison as well as forfeiture, fines and restitution of more than $2 million.

Firefighter Faces 30 Years in Prison for Federal Tax Charges

A retired Nevada firefighter was convicted on multiple counts of tax evasion and filing a false claim with the Internal Revenue Service.

Dwight C. Jackson, 53, of Henderson, Nev., was convicted of five counts of tax evasion and one count of filing a false and fictitious claim.

According to the charges against Jackson, during the years 2004 through 2008, Jackson was employed as a firefighter with the city of Henderson and earned more than $113,000 each year. The federal income tax he owed for those years was between $22,000 and $29,000. Jackson attempted to evade taxes by understating his wages on his tax return, falsely claiming the earned income tax credit, submitting false W-4 forms with his employer claiming he was exempt from federal tax withholdings, and concealing his income from the IRS. For the year 2009, Jackson presented a false income tax return stating that he earned no wages in 2009 when he had earned $247,492.

Jackson carried out his scheme with the help of a James Mattatall, a member of the fringe sovereign citizen movement. Sovereign citizens believe government taxation is illegitimate.

He faces up to 30 years in prison and fines of up to $1.5 million.


--Our Policies--

Nelson & Company, P.S., CPAs Since 1979

Circular 230 Disclosure:
To ensure compliance with requirements imposed by the IRS, we inform you that (i) any tax advice contained in this communication (including any attachments) was not intended or written to be used, and cannot be used for the purpose of avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.