Jump to Navigation
Over 30 Years of Experience handling tax controversies & tax disputes

April 2013 Archives

Massachusetts historic building's future unclear

The historic Essex House in Holyoke is facing foreclosure as its current and former owners are delinquent in paying a substantial amount of taxes. A tax lien was previously placed on the property to no avail. The property is also in a deteriorating state, causing many city officials to be concerned about its unclear future and contemplating methods that would establish a long-term plan for the building. The property currently has an outstanding tax bill of more than $76,780, stemming from taxes that accrued between 2008 and 2013. A tax collector filed a tax taking for the property in 2011 when over $7,000 was due in unpaid taxes. The property was then eligible for a foreclosure by the city during the same time period, but many properties were also subject to foreclosure at the time, so action was delayed on the Essex House. Finally, the property was officially approved for foreclosure in September 2012 with a complaint to foreclose the lien in November 2012. 

High earners more likely to be audited

A new analysis of Internal Revenue Service data shows that the IRS is more likely to go after high-wage earners than lower income taxpayers. The data revealed that taxpayers who have taxable incomes in excess of $1 million were almost 12 times more likely to have a tax audit conducted on them, compared to other taxpayers. Out of the high-wage earners who were audited, approximately one-eighth of them were examined by the IRS in 2012 fiscal year, resulting in 41,000 examinations. While approximately 25 percent of these tax returns did not result in any change in the taxes that needed to be paid, the vast majority of the returns resulted in a change. Some audits resulted in finding that more taxes were owed. On average, the amount of additional taxes per return was $117,000, totaling about $4.8 billion overall.

Actor owes $300,000 in back taxes

Massachusetts residents may have heard that Stephen Baldwin has entered into a plea agreement regarding taxes that he owes New York state. In exchange for paying $300,000 within a year's time, Baldwin will avoid carrying around a record for tax evasion. Stephen Baldwin originally owed taxes, interest and penalties in the amount of $400,000, but according to New York state Supreme Court Justice Charles Apotheker, Baldwin has paid off approximately $100,000 of his tax debt. He admitted in court that he did not pay the state income tax that he owed for the years 2008, 2009 and 2010. He has one year to pay off the rest of the debt that he owes to avoid jail time and a criminal record for the offense, but if he is unable to pay off the $300,000 within that time frame, Baldwin will receive a five-year probation sentence and a five year time frame in which to pay off the remaining debt.

Carefully choose a tax preparer to avoid problems

The IRS is aware of several tactics that unethical tax preparers use, and it is trying to warn the general public this tax season. Tax preparers may file false income tax returns by claiming more personal expenses or business expenses, claiming deductions or credits that they do not qualify for and using exemptions in an excessive manner. The IRS has also seen tax preparers who may change income figures on the tax returns to try to get more credits for the client. However, Boston taxpayers are the ones who are ultimately held responsible when fraudulent income tax returns are submitted. Typically, they are required to pay any additional taxes, interest and penalties that are incurred due to a false income tax return. They may also be held criminally liable in some cases.

Have a Question? Ask an Attorney:

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close
Visit Our
Tax Law Website
Contact Information

Levins Tax Law, LLC
1671 Worcester Road, Suite 304
Framingham, MA 01701

Framingham Law Office Map

Levins Tax Law, LLC
38 Newbury Street, 6th Floor
Boston, MA 02116

Boston Law Office Map
By Appointment Only

Phone: 508-435-0118
Toll-Free: 888-333-9501
Fax: 888-333-0291