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New York Tax Lawyer Blog

How small business owners can avoid misclassifying employees

To start and grow their businesses, small business owners must wear many hats and become pseudo-experts in marketing, sales, accounting, tax planning and human resources matters. Given the varied and complex nature of each one of these business principles, it's no wonder that many small business owners make mistakes that, if not corrected, can end up costing them dearly.

Earlier this month, the shipping and delivery giant FedEx agreed to settle what's being called a landmark employment and tax case. At issue was whether FedEx erred when the company classified delivery drivers as independent contractors rather than employees. While the company maintains it committed no labor law violations, its decision to settle the case for $228 million speaks volumes and serves as a wake-up call for all U.S. employers—big and small.

What's a federal tax lien and how do I get rid of it?

There are many scenarios that may result in an individual accruing tax debt. In cases where an individual is notified by the IRS via a Notice and Demand for Payment of an outstanding tax bill, it's wise to address such matters in a prompt manner. At times, an individual may refute the amount or existence of tax debt. When contacted by the IRS, individuals who fail to take action with regard to an outstanding tax bill may be subject to fines and penalties including a federal tax lien.

Individuals who receive a Notice of Federal Tax Lien are likely to have many questions and concerns about how a lien affects their financial standing and credit. An attorney who handles tax issues can assist with problems that stem from and disputes related to tax debt.

What to do when the IRS gets it wrong

Now is the time of year when taxpayers begin getting those dreaded letters from the IRS saying that they didn’t pay the taxes that they owed. In some cases, people might be expecting the letters, knowing that they didn’t pay their taxes in full.

But in other cases, people might believe that the letter was sent in error. In this case, the good news is that there are steps that can be taken in order to figure out if the IRS has made a mistake. Believe it or not, the IRS has been known to get it wrong from time to time.

When divorce and tax debt collide

There are two common issues that arise when divorce and tax debt collide. One involves a spouse who finds out that he or she is on the hook for significant tax debt after signing jointly filed tax returns that were fraudulently prepared by the soon-to-be ex-spouse.

The other scenario involves a couple who has many years of unfiled tax debts and are wondering if the unfiled tax returns for the back taxes should be filed as joint tax returns or married filing separate returns.

Haven’t paid your taxes? Consider voluntary compliance

Did you let Tax Day come and go without filing a return or paying what you owe to the IRS? If so, you are certainly not alone, but that doesn’t make the consequences that you face any less serious.

Chances are that you didn’t file a tax return because you can’t afford to pay the money that you owe. Maybe you don’t even know how much you will owe, you just know that you can’t afford to pay the IRS anything. 

Can’t afford to pay your tax bill? We can help

Tax day, April 15, is just a few days away and if you are like many New Yorkers, you may be hoping to win the lottery before then in order to be able to pay your tax bill on time.

Believe it or not, you may not need a winning lottery ticket in order to make good with the IRS this tax season.

3 tax complications to keep an eye on this year

Taxpayers have only a few days left before the April 15 deadline to file their income tax returns or request an extension with the Internal Revenue Service. “Review twice, file once” would be a good saying for tax returns, because any mistake could lead to problems down the road.

The reality is that even a careful review will not catch some of the mistakes made by taxpayers and even some inexperienced tax preparers who do not know all the complex rules. Listed below are just three things to watch out for when reviewing a 2014 tax return, and ones you should get some help with when filing.

Items potentially increasing your tax bill

There’s no end to items facing taxation – ones we may be unaware of. This includes unemployment benefits, forgiven debt, and certain Social Security benefits. With tax planning, we can minimize the amount of taxation owed and be better prepared for the next tax season.

As welfare and public assistance benefits usually are not subject to taxation, it may seem surprising discovering that we owe taxes on unemployment benefits. Unfortunately, there’s little we can do to reduce the obligation to pay tax on unemployment received. It’s allowable to recover certain amounts paid in as nondeductible contributions to unemployment funds. Other than that, the way to lessen the amount of taxes we pay on these benefits in April is to have more taxes withheld from these benefits throughout the year.

Why on-demand workers are more likely to get audited

Being audited is a big fear for many New Yorkers, especially around this time of year. It can not only be a long and burdensome process, it can also be quite scary because of the potential penalties involved.

Unfortunately, if you are an on-demand worker, such as a driver for Uber, Sidecar or Lyft, it is almost inevitable that you will be audited at some point in the near future, according to a Forbes.com article.

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