Saturday, October 18, 2014
Monday, October 6, 2014
Wednesday, September 24, 2014
Friday, September 19, 2014
Scott Brown and Debbie Wasserman Schultz: The Deductibility of Politicians' Grooming and Clothing Expenses
The American Democracy Legal Fund has sent this letter requesting the IRS to investigate certain deductions claimed by New Hampshire Republican Senatorial Candidate Scott on his 2010 and 2011 tax returns, including $3,550 for "TV makeup and grooming.
- MSNBC, Democrat Group to IRS: Look Into Scott Brown’s Grooming Deductions
- The State, Can Pols Write Off Hair and Makeup
Read the hilarity below:
Thursday, August 21, 2014
Forbes: Could The IRS Disallow Ice Bucket Challenge Charitable Contributions?, by Tony Nitti:
Saturday, August 9, 2014
Robert Redford Sues New York Over $1.6 Million Tax Bill; Can State Tax Nonresident on Sale of Interest in Nonresident LLC?
- Accounting Today, Robert Redford Sues New York over $1.6M Tax Tab for Selling Sundance Channel
- Broadway World, Robert Reford Suing New York Over Sundance Tax Bill
- Hot Air, Robert Redford Sues to Get His $1.6 Million Back From the Fair Share Pot in NY
- New York Daily News, Robert Redford Suing New York State Over His $1.6 Million Tax Bill
- New York Post, Taxing Robert Redford
- USA Today, Robert Redford Sues N.Y. Over $1.6M Tax Bill
- Washington Times, Robert Redford Sues New York Over $1.6 Million Tax Bill
- The Wrap, Robert Redford Sues NY State Over $1.6 Million Tax Bill for Sundance Channel Sale
Sunday, July 13, 2014
Tax Foundation: $21,000 Tax Bill Just for Some Potato Salad:
Other commentators have pushed back on the Tax Foundation's analysis, arguing that the payments would constitute non-traxable gifts.
- Business Insider, Zack Brown Could Owe More Than $21,000 In Taxes For His Potato Salad Kickstarter
- Forbes, My Advice To Kickstarter Potato Salad Guy: Don't Write That Tax Check Just Yet
- Going Concern, The Tax Foundation Is Concerned About the Tax Implications of Potato Salad
- The New Yorker, The Potato-Salad Guy Should Keep Every Penny
- Tax, Society & Culture, Potato Salad
- Washington Post, Kickstarter’s Potato Salad Guy Is About to Pay a Whole Lot of Taxes
(Hat Tip: Eli Bortman, Allison Christians, Leandra Lederman.)
Thursday, July 10, 2014
Wednesday, July 9, 2014
Thursday, June 26, 2014
Tuesday, June 17, 2014
Thursday, June 12, 2014
Wednesday, June 11, 2014
Tuesday, June 3, 2014
Thursday, May 15, 2014
Wednesday, May 14, 2014
Sports Illustrated, State Taxes May Compel Johnny Manziel to Avoid Ohio Residency:
(Hat Tip: Bill Turnier.)
Monday, May 5, 2014
Could Forced Sale of the L.A. Clippers Save Donald Sterling $323 Million in Taxes as § 1033 Involuntary Conversion?
Following up on my previous post: The Daily Beast, Donald Sterling’s Last Laugh: Force Him to Sell the Clippers and He Could Pay No Taxes; Ironically, the NBA’s Ultimate Penalty Will Save the Owner as Much as $323 Million, by Nick Lum:
Thursday, May 1, 2014
- National Post, Why Donald Sterling’s Punishment Could Cost Him More than $100M
- Slate, Why the NBA’s Punishment Could Cost Donald Sterling More Than $100 Million
- Sports Illustrated, Important Tax Law Considerations: Avoiding Capital Gain Taxes
- Vox, The $200 Million Reason Donald Sterling Doesn't Want to Sell the Clippers — Capital Gains Taxes
- Washington Post, What Donald Sterling Could Make If He’s Forced to Sell the Clippers
Sunday, March 16, 2014
Sunday, March 2, 2014
1. IRS, Gift Bag Questions and Answers:
- The 2014 Oscar “Swag Bag” Is Worth $80,000 — and Counts as Taxable Income
- The Evolution of the Oscar Gift Bag
- Oscar Freebies Balloon To $80K (Don't Tell IRS)
2. U.S. News & World Report, And the Winner of the 'Worst Tax Policy' Oscar Is ..., by Matthew Mitchell (George Mason University):
Film subsidies from the government are a waste of money.
TaxProf Blog, The Wolf of Wall Street Wins Oscar for Best Tax Break:
3. Forbes: Tax Lessons From Woody Allen's 'Blue Jasmine', by Peter J. Reilly:
Friday, February 21, 2014
The Oklahoman: Kevin Durant Sues Accountant Over Tax Troubles:
- ESPN, Kevin Durant Suing Accountant
- Forbes, Kevin Durant Calls Foul on Tax Preparer Over Improper Deductions, by Tony Nitti
- TMZ, Kevin Durant Sues Accountant: You Can't Write Off My Personal Chef!
- USA Today, Kevin Durant Sues Ex-accountant For Tax Troubles
(Hat Tip: Jon Forman.)
Monday, February 17, 2014
The Guardian: Abba Admit Outrageous Outfits Were Worn to Avoid Tax:
I guess that explains this:
Money, money, money
Must be funny
In the rich man's world
Money, money, money
In the rich man's world
All the things I could do
If I had a little money
It's a rich man's world
(Hat Tip: Pippa Browde, Sergio Pareja.)
Tuesday, February 11, 2014
- ABC News, Should US Olympians Pay Taxes on Medals?
- Americans for Tax Reform, Achieve Olympic Glory -- Now Pay the IRS
- Atlanta Journal-Constitution, Pay the Piper: U.S. Medalists Face Hefty IRS Bill for Their Olympic Glory
- Daily Caller, Why the IRS Should Keep its Mitts Off the Winter Olympics
- Forbes, Win Olympic Gold, Cash, Then Endorsement Payday, by Robert W. Wood
- Fox News, The Price of Gold: Taking First Place in Olympics Could Cost US Stars as Much as $10G in Taxes
- Texas GOP Vote, Going for Olympic Gold: Removing the Tax Burden from Team USA
- Town Hall, Gold Medalists Will Owe the IRS Big Time
- Yahoo! Sports, Here Are the Taxes Team USA Medalists Can Expect on Their Prize Money
Monday, February 10, 2014
- Inquisitr: Michael Jackson Net Worth: Why the IRS Death Tax Is Wrong
- L.A. Times: Michael Jackson Estate Embroiled in Tax Fight with IRS: Executors Say Michael Jackson Was Worth $7 million When He Died. The IRS Says It's More Like $1.125 Billion and wants $702 million in taxes and penalties.
- New York Post: Jacko Estate Owes Us $702M: IRS
Sunday, February 2, 2014
- Accounting Web, Super Bowl Money and Tax Facts You May Not Know
- Canada Free Press, Super Bowl or Super Taxes?
- Fox 31 Denver, Peyton Manning’s Financial Incentive to Win? Avoiding 101% Tax on Super Bowl Bonus
- Fox Business, New Jersey 'Jock Tax' Tackles Super Bowl Earnings
- New Jersey Newsroom, Super Bowl 2014: N.J. Benefits From Big Game’s Jock Tax
- Newark Star-Ledger, NJ Gives NFL Super Tax Break for Super Bowl, and Pays for Security
- Rush Limbaugh, The Jock Tax -- and Other Super Bowl News
Monday, January 20, 2014
Thursday, December 26, 2013
Forbes: Mark Zuckerberg's $2 Billion Tax Bill Double Last Year, Higher Than Most Billionaries, by Robert W. Wood:
- Wall Street Journal, Zuckerberg to Pocket $1 Billion in Facebook Stock Sale
Prior TaxProf Blog coverage:
- Will Mark Zuckerberg Ever Pay Taxes Again? (Aug. 6, 2012)
- McCaffery: Mark Zuckerberg May Never Pay Taxes Again (April 10, 2013)
Wednesday, December 25, 2013
Tuesday, December 17, 2013
Friday, December 13, 2013
Thursday, December 12, 2013
Monday, December 9, 2013
- The Daily Mail, 'I Got a Receipt!' MC Hammer Takes to Twitter to Dispute Reports He Owes $800,000 in Back Taxes
- Forbes, IRS To Rapper: It's Hammertime!
Wednesday, November 13, 2013
Washington Post, Tina Turner Formally ‘Relinquishes’ U.S. Citizenship:
For the difference between relinquishing and renouncing U.S. citizenship, see here. As this detailed post makes clear, the tax consequences are the same whether one relinquishes or renounces U.S. citizenship. Previous press coverage suggested that Ms. Turner's actions may be motivated in part by a desire to escape the new FATCA regime.
(Hat Tip: Walter Schwidetzky.)
Tuesday, November 12, 2013
Thursday, November 7, 2013
Tuesday, October 1, 2013
Thursday, September 19, 2013
Ty Warner, CEO of Ty Inc., which makes Beanie Babies, has agreed to plead guilty to tax evasion and pay $53.6 million in penalties in one of the largest offshore tax evasion cases in history. He tried to enter the IRS's Offshore Voluntary Disclosure in 2009 but was rejected because he was already under investogation.
- DOJ Press Release
- Federal Tax Crimes
- Tax Update Blog
- USA Today
- Wall Street Journal
Saturday, September 14, 2013
Following up on my previous post, NFL.com: Tax Issues for Manziel Raised From Alleged Autograph Income:
- The Big Lead, Could Johnny Manziel Face IRS Scrutiny Over the Autograph Allegations?
- Texas Tax Talk, Could Johnny Football Go To Jail?
Thursday, September 12, 2013
Bloomberg, How Wal-Mart’s Waltons Maintain Their Billionaire Fortune, by Zachary R. Mider:
Saturday, August 31, 2013
Friday, August 30, 2013
The NCAA and Texas A&M yesterday agreed on the suspension of Heisman Trophy winning quarterback Johnny Manziel for the first half of Saturday's season-opening game at Rice for violating NCAA bylaw 126.96.36.199, which states that student-athletes cannot permit their names or likenesses to be used for commercial purposes, including to advertise, recommend or promote sales of commercial products. or accept payment for the use of their names or likenesses.
Louisville Courier-Journal, Maybe IRS Should Take a Look at Johnny Manziel, by Tim Sullivan:
Thursday, August 22, 2013
My nominee for tax headline of the year is from Kelly Phillips Erb: Michael Jackson's Estate to IRS: Beat It:
- Accounting Today, Michael Jackson’s Estate Challenges IRS in Dispute over Tax Bill
- Bloomberg, Michael Jackson’s Estate Challenges IRS in Tax Dispute
Thursday, August 15, 2013
Detroit Free Press, IRS Lawyers Defend $2B Tax Bill to Bill Davidson Estate:
- Accounting Web, Death Tax Grasps for More of William Davidson's Wealth
Monday, July 22, 2013
Following up on my previous post, James Gandolfini's Will Is a 'Tax Disaster': New York Times, A Public Debate Over the Wisdom of Gandolfini’s Will, by Paul Sullivan:
[A] few weeks after he died, the discussion shifted to his will, which, unlike the wills of most wealthy people quickly became public. Almost immediately, many experts found fault with its contents, saying it was so unwisely constructed it could lead to lawsuits from his heirs.
And then there was the estate tax bill — estimated at a whopping $30 million, nearly half of his reported net worth of $70 million all because of supposedly bad tax planning.... [I]t seemed downright bizarre — at least to me — that he might not have had sound financial advice.
Was this true? Were the numbers accurate? Did any of these commentators know what they were talking about? At first blush it certainly seemed to me that there indeed were serious problems with the will. But before I formed my final opinion, I decided to call Roger S. Haber, Mr. Gandolfini’s lawyer, who drafted the will and is one of its executors. In “Sopranos” parlance, he was Mr. Gandolfini’s consigliere in life and was the man, after his death, who was bearing the brunt of the estate tax ire. ...
He told me that Mr. Gandolfini knew the difference between a probate asset — which is governed by his will — and a non-probate asset, like a retirement account, life insurance policy or asset held in an irrevocable trust. Although Mr. Haber would not elaborate, the implication was that perhaps Mr. Gandolfini had assets in other vehicles that would mitigate his tax liability. The prospect was intriguing.
But I sought outside counsel to examine Mr. Gandolfini’s will and two affidavits that were filed after it. ... The burning question is, does Mr. Gandolfini’s estate have an enormous tax bill? The $30 million figure that was floating around is based on two assumptions that could be wrong. The first was that he was worth $70 million; the second was that his will guides how all that money is disbursed....
Another expert agreed that taxes might not always be the most important consideration. “All these people who are out there talking about the taxes, they don’t get it,” said Leiha Macauley, a partner and head of the Boston office at the law firm Day Pitney. “The person who is trying to provide for the children from the first marriage, the second marriage, and a wife who may be the same age as his sisters, he doesn’t care about estate taxes. He wants to provide for them equally.” Had he wanted to avoid federal estate taxes, he could have left everything to his wife, Ms. Macauley said.
The one thing Mr. Haber could have saved Mr. Gandolfini from was this column and every other article or blog written about his will. They would not have been possible if Mr. Gandolfini had had a revocable trust. Such a trust, which is easy and cheap to create, would have enabled him to have a simple “pour-over will,” which would have said that his possessions had been put into the trust. No one would know anything more about his assets or his intentions. ... “Why would a guy with this much notoriety have a will in the public record?” Mr. Scroggin said. “I have high-profile clients and we do pour-over wills as much as anything to avoid this media brouhaha.”...
Mr. Haber said that Mr. Gandolfini’s children would be fine because the actor had focused on their guardians and trustees more than the money they might inherit.“Jim was a very smart guy and he took all of this seriously,” he said. “He did what he wanted to with full awareness of the laws.”If that is the case, then his estate plan accomplished its purpose, regardless of what others think.
- Accounting Today, Gandolfini Tax Hit
- Altman Speaks, The Will of James Gandolfini: Bad Tax Planning or Good Listening?
- Estate of Denial, James Gandolfini Will a Tax ‘Disaster,’ Says Top Estate Lawyer
- Forbes, Key Lessons From James Gandolfini's Will
- Fox Business, Lessons Learned from James Gandolfini’s Will
- Private Wealth, Learning From Gandolfini's Estate Plan 'Disaster'
- Probate Lawyer Blog, James Gandolfini's Estate Planning Mess
- U.S. News & World Report, Estate Planning Lessons From James Gandolfini
- Howard M. Zaritsky, In Defense of James Gandolfini and Ed Koch
(Hat Tip: Mike Talbert, Bill Turnier.)
Tuesday, July 23, 2013
Following up on my previous post, Will IRS Strike Out in Estate Tax Litigation Over Valuation of Minnesota Twins?:
- Minneapolis Start-Tribune, Pohlads Go One-on-One with IRS:
More than three years after the death of Carl Pohlad, the estate of the billionaire business magnate is mired in a tax dispute with the IRS that has potentially huge financial consequences.
The agency claims that Pohlad’s heirs owe the IRS more than $207 million, largely on the basis of a purportedly low valuation the estate placed on the late patriarch’s most visible asset, the Minnesota Twins. The tax collector also wants $48 million as an “accuracy related penalty” for a total potential tax bill of $255.8 million.
The Pohlad family disputes the IRS position and asserts that the federal agency greatly overvalued Carl Pohlad’s interest in the Twins after he handed most of the control of the ballclub to his sons in the years leading up to his death in 2009. ...
According to the experts hired by the estate, Carl Pohlad’s interest in the Twins was just $24 million at the time of his death in early 2009. The IRS places the value of those assets at $293 million.
The Pohlad estate asserts that Carl Pohlad’s minority ownership of the Twins at the time of his death — with his three sons controlling 90% of the voting shares of the club — is not adequately reflected in the IRS valuation, nor is the Great Recession, which confronted the U.S. economy at the time. ... The Pohlad estate has requested a Tax Court trial in Houston, home of the law firm handling its tax case, Baker Botts. ... At $255.8 million, the dispute would be among the richest pending before the Tax Court. ...
Combined, Carl Pohlad’s financial interest in the Twins was posted at just shy of $24 million, according to the Tax Court petition. The total value of the Twins at the time of Pohlad’s death was estimated at $356 million by Forbes magazine. But [John] Porter, the Baker Botts attorney representing the Pohlads in the IRS matter, said the valuation figures are gross figures that don’t include liabilities such as stadium debt. Moreover, Porter said, the economic environment was not conducive to the sale of sports franchises at the time of Carl Pohlad’s death.
- Minneapolis Star-Tribune, Pohlads' Dispute With IRS Over Team's Value Was Just Estate Planning:
The remarkable story of how the Pohlad family ended up in a nine-figure fight with the Internal Revenue Service over the late Carl Pohlad’s estate isn’t that remarkable at all. It’s called estate planning.
Even though there’s a list of things in dispute with the IRS, including how to treat a block of cemetery plots, this is really all about the chasm between what the IRS thinks Carl Pohlad’s Minnesota Twins ownership stake was worth in January 2009 — $293 million — and the $24 million value the estate’s tax return put on his Twins equity.
Carl Pohlad owned his Twins equity in several pieces. At the time of his death he owned a 52.2% nonvoting interest in MT Sports LLC, which in turn owned a 99%, nonvoting interest in Minnesota Twins LLC. He also owned a 95.5% equity interest in Twins Sports Inc., the managing member of the Minnesota Twins LLC.
In a limited liability company like Minnesota Twins LLC, the managing member is in charge, and usually has authority to borrow money, hire and fire employees and take other actions that the non-managing members have no right to do. But Carl Pohlad owned only 10 percent of Twins Sports’ voting shares, with the rest equally split between Jim and his two brothers.
Sure, there were three separate companies and multiple classes of equity, but as such things go in the ownership of a family business, this structure for the Twins is not particularly artful. What it meant is that at the end of Carl Pohlad’s life, he owned the majority of the franchise but did not control it. ...
Jim Pohlad explained that “you can’t just look up in the Wall Street Journal and figure out the value of things like the Twins,” adding that he and his brothers relied on their valuation experts in wrapping up the estate. ...
When this is settled, the final number won’t be public, but it’s my guess it’s going to be much closer to the position of the Pohlads than the IRS.
Saturday, July 6, 2013
New York Daily News: James Gandolfini Will a Tax 'Disaster,' Says Top Estate Lawyer:
The taxman is coming after James Gandolfini's heirs. The late Sopranos star's will is "a disaster" that could see over $30 million of his estimated $70 million estate go to the government, a top estate lawyer told the Daily News.
"It's a nightmare from a tax standpoint," said William Zabel, who reviewed the document at The News' request. The 51-year-old's "big mistake" was leaving 80% of his estate to his sisters and his 9-month-old daughter, Zabel said. That made 80% of the estate subject to "death taxes" of about 55%, and the bill is due in nine months, Zabel said.
That means his family will have to start selling off his property and liquidating his assets soon in order to pay the tab, since it's unlikely the actor had tens of millions of dollars in cash on hand. ... The 20% of the estate that Gandolfini left to wife Deborah Lin isn't directly subject to the death tax, but even she'll take a big hit, Zabel said. The will calls for the shares to be divvied up after all the taxes are paid, which means Lin will get 20% of the $40 million left after taxes, instead of 20% of $70 million. "It's a catastrophe," Zabel said. ...
He said there are ways for the beloved actor's family to get out from under the enormous tax burden, but it would be tricky. One solution could be for the sisters and daughter to renounce their shares in the estate for payments later on down the road.
(Hat Tip: Bill Turnier.)
- ABA Journal, Gandolfini Will Is a Tax ‘Catastrophe,’ Estates Lawyer Says
- Iowa Planning and Probate, Was James Gandolfini's Will a Tax Disaster, or a Reasonable Plan For His Situation?
- Questionable Planning, Terrible Reporting
Seven-time NBA all star Dwight Howard yesterday signed with the Houston Rockets for the maximum free agent contract permitted under the NBA's "Larry Bird Rule" -- $87.6 million over four years (4.5% annual increases over his existing contract). He spurned a much higher offer from the L.A. Lakers -- $118.0 million over five years (7.5% annual increases). Several tax folks have run the numbers and concluded that Howard will receive more after-tax income by signing with the Rockets rather than the Lakers, based on California's 13.3% top marginal income tax rate and the absence of a state income tax in Texas, after taking into account the application of various state and local "jock taxes."
- Accounting Web: Will Taxes Affect Dwight Howard's 'Decision?'
- Dream Shake: Will State Income Tax Bring Dwight Howard to Houston?
- Forbes: Could State Taxes Cause Dwight Howard to Flee L.A. for Houston?
- Joy of Tax Law: The Taxing Lives of Dwight Howard and Professional Athletes
- Wall Street Journal: Dwight Howard and the Tax Man
- Wall Street Journal: Tax Break Could Give Texas Teams an Edge
- The Week: Could Low Taxes Help Texas Teams Lure Dwight Howard?
(Hat Tip: Tony Nitti.)