It’s Time to Prepare and File your 2019 Tax returns

The Honeymoon is Over: Part Deux

If you have not filed your 2019 individual income or business tax returns yet or paid the tax liability, you have until July 15 to file those returns and pay the tax due without incurring penalties for late filing and for late paying.

As I discussed in a prior blog, there are 2 penalties that attach to the failure to file on time and the failure to pay the tax due. You want to file even though you cannot pay or fully pay the tax liability. Further, you can request a filing extension if submitted before July 15, but you cannot extend the time to pay the tax. The gov wants its money and there is no extension for paying the tax. If you cannot pay in full, you should pay as much of the tax as you can so you reduce the amount of the penalty and interest. You should arrange for a payment plan to pay off the tax liability as quickly as possible.

FILING TIP: If you mailed in a paper return to the IRS, do not mail a second return or a copy as it will really mess up any refund you might be expecting. The gov offices have been closed since March due to the virus and mail has been collected and stored until the workers are called back into their buildings. We expect that re-call to occur slowly in various locations in late June and into July. Taxpayers who e-filed expecting a refund should have received their refunds.

If you are desperate to alleviate your federal, state, or local tax debts, call
McFARLANE LAW – A Tax Law Firm
T. 480-991-0032 / e: [email protected]/ net: www.taxlawaz.com

We provide real help for a reasonable fee.

We represent clients at all administrative agency and appeal levels, the Arizona Tax Court, and the federal US Tax Court, and throughout Arizona: Phoenix, Glendale, Peoria, Scottsdale, Mesa, Tempe, Chandler, Queen Creek, Yuma, Casa Grande, Tucson, Sierra Vista, Bisbee, Flagstaff, Prescott, Payson, Coconino County, Yavapai County, Maricopa County, Pima County, Cochise County, Pinal County.

Can’t Pay Your Tax Liability? Is an Offer-in-Compromise Right for You?

There are certain tax problems that require the assistance of a tax attorney, and determining if an offer-in-compromise (OIC) can resolve your tax issues with the Internal Revenue Service (IRS) or Arizona Department of Revenue (ADOR) is one of those cases.

So you owe taxes that you will not be able to pay in a reasonable period of time. Although despair sets-in, there is tax relief assistance. You should seek such assistance from an experienced tax attorney – don’t waste your time or money with non-lawyer national outfits claiming they can resolve your tax problems.

McFarlane Law – Your Tax Law Firm - Tel. 480.991.0032 – has over 30 years of experience handling tax matters and problems of all types and urgency. Seeking OIC relief can be complex. Negotiations are often required in which experience and knowledge produce an effective and efficient result.

If you owe taxes that you cannot possibly pay in your working life-time, contact McFarlane Law. We will provide you an overview of the IRS and ADOR Offer-in-Compromise programs. After discussing your facts and circumstances, Mr McFarlane will be able to provide an in-depth analysis of the different types of Offers and when to use each. He will discuss your expected payments based upon a computation of your financial statements and asset values to arrive at what the IRS terms, your “Reasonable Collection Potential.”

If you are in collection mode with the IRS and/or ADOR, you need to act to resolve the tax problem before collection action is taken and your options become limited.

McFARLANE LAW – A TAX LAW FIRM
T. 480.991.0032 / e: [email protected] / www.taxlawaz.com

With offices available throughout the Phoenix Metro area, Tucson, Casa Grande, Sierra Vista, Flagstaff, Prescott, Sedona.

The Honeymoon is Over – It’s Time to Think Taxes!

Remember: An extension to file is not an extension to pay taxes

For most taxpayers (including individual, businesses, and fiduciaries), the filing and payment deadline for their 2019 federal and state tax returns was postponed to July 15. Those who need more time to file beyond the postponed date (July 15) can request an extension to file and must request that extension to file by July 15. The federal extension gives taxpayers until October 15 to file their federal tax return.

Taxpayers need to check with their individual state’s laws to determine the effect of an extension. In Arizona, a federal extension filed by July 15 allows taxpayers to file their state tax return by January 15, 2021. If a federal extension is not filed, then Arizona Form 204 (individual) needs to be filed by July 15 to extend time to file Arizona returns.

Take heed of the following good advice so you are not scrambling to respond on July 15!

An extension to file is not an extension to pay! Taxes must be paid in full by July 15 to avoid penalties (fed and state)! So budget now to make that tax payment for your 2019 liability.
Understand the penalties! There is a failure to file penalty and a failure to pay penalty (fed and state). These are separate penalties and accrue over time to a maximum of 25% each of the tax you should have paid.
Failure to timely file and fully pay the tax liability by July 15 will result in penalties and interest. If you cannot pay, at least file to avoid the failure to file penalties (fed and state).
Do not ignore your omission to file or pay tax. Call your friendly tax attorney for assistance in negotiating a reasonable payment plan. Often, the IRS agents will seek large payments that you cannot afford. It is best to insert a tax attorney between you and the IRS agent to arrive at a reasonable and sustainable payment plan.
Call McFarlane Law - A Tax Law Firm. All we do is negotiate with the IRS and ADOR and resolve taxpayer’s problems.

If you need assistance filing your 2019 returns or making tax payments to the IRS or ADOR, call McFarlane Law – A Tax Law Firm with offices located in the Phoenix – Scottsdale – Tempe – Glendale – Peoria metro areas for a consultation of your facts and issues.

McFarlane Law – A Tax Law Firm - resolves tax problems for taxpayers located in Maricopa County, Pima County, Pinal County, Coconino County, Cochise County, Phoenix, Peoria, Mesa, Tempe, Scottsdale, Tucson, Flagstaff, Prescott, Cottonwood, Sedona, Sierra Vista, Casa Grande.

Have You Filed Your 2019 Tax Returns?

As you know, the deadlines to file and pay 2019 federal income taxes have been postponed to July 15, 2020. If you need more time to file taxpayers can request an automatic extension to file until Thursday, October. 15. Contact your tax professional for assistance. Taxpayers should remember that an extension of time to file is not an extension of time to pay. Penalties and interest may apply to taxes not fully paid by July 15.

As Society Reopens, Don’t Be Duped by ‘Tax Relief Experts’

As we come out of the COVID-19 societal lockdown and you have significant tax problems to resolve, don’t be duped into giving money to non-tax professional outfits who claim to be “Tax Relief Experts.” Most times they will take your money but cannot resolve your tax issues. They do not have the expertise or relationships that are essential in efficiently resolving your tax problems. So, do not waste your money! Rather, call a local tax attorney who you can meet and depend upon.

We at McFARLANE LAW – A Tax Law Firm - T.991-991-0032 – are licensed attorneys who are professionally liable to zealously represent you and assist in resolving your tax problem. In a previous blog, we explain why you need to engage a CPA or tax lawyer such as McFarlane Law – A Tax Law Firm - T.480-991-0032.

There are many national outfits who profess to be ‘Tax Relief Experts.” They are not what they profess to be – just google the many Attorney’s General class action lawsuits filed against these outfits after misleading customers as to their services. So do not get duped into wasting your time and money.

Stephen McFarlane MBA, JD, LL.M (Tax Law) is a Master in Tax Law (Boston University, School of Law, Graduate Tax Program, 1990). Mr McFarlane has 30 years handling federal, state, and local tax law cases. He is a Former IRS Tax Litigation Attorney. Over his 30 years representing small business and taxpayers, he has established the important relationships with the federal, state and local government agents, officers, and their managers.

If you feel like you may have been targeted by a fraudulent tax relief company, contact Attorney Stephen McFarlane today. Our consultations are free, confidential and without any obligation on your part. We can help answer your questions and resolve your tax controversy.

TIP: If you are desperate to alleviate your federal, state, or local tax debts, call

McFARLANE LAW – A Tax Law Firm

T. 480-991-0032 / e: [email protected] / net: www.taxlawaz.com

We provide real help for a reasonable fee.

I took an Early Withdrawal from my Retirement Account. Now what?

On a regular basis I get clients who have taken a distribution out of their qualified individual retirement account or retirement plan before reaching 59 ½ years of age (the time when you can take a distribution and be subject to the 10% penalty). They do this before informing their bookkeeper, CPA, or attorney of their intent. This can trigger an additional tax on top of other income tax they may owe.

Early Withdrawals. An early withdrawal normally is taking cash out of a retirement plan before the taxpayer is 59½ years old. The IRS charges a 10 percent penalty on early withdrawals from most qualified retirement plans. There are many complicated exceptions to this general rule. So taxpayers should consult with their tax professional prior to taking a distribution.

For example, the additional tax does not apply to distributions due to an IRS levy of the plan. While the plan may be protected from creditors under state laws, a levy action by the IRS is a contested collection action that needs to be addressed by an experienced tax attorney.

The additional tax does not apply to nontaxable withdrawals. These include withdrawals of contributions that taxpayers paid tax on before they put them into the retirement plan (i.e., Roth contributions that meet time requirements). Other exceptions per IRC §§72(y)(2) et seq. include:

qualified higher education expenses;
qualified 1st time homebuyer (up to $10,000);
amount of unreimbursed medical expenses greater than 7.5% of taxpayer’s AGI (or 10% of AGI after 2012 if under age 65);
certain distributions to qualified military reservists called to active duty;
if a qualified employee separates from service;
and other exceptions that should be discussed with your tax professional.

Rollovers are also a nontaxable withdrawal. A “rollover” happens when a taxpayer takes cash or other assets from one qualified retirement plan and puts the money in another plan within 60 days. A rollover can also happen when they direct their plan administrator to make the payment directly to another retirement plan or to an IRA. The latter is the preferable procedure as the details of the transaction are fully reported to the IRS. The former procedure requires the taxpayer to monitor the 60-day period (no exceptions) and to keep records of the transaction to give to taxpayer’s tax return preparer as the IRS may only have information of one side of the transaction.

Be sure to notify your return preparer and ask questions before you sign your tax return. Best to get the advice up front rather than risk the IRS noticing you and perhaps looking deeper into your returns.

McFARLANE LAW – A Tax Law Firm
T.480.991.0032 / [email protected] / IRS & ADOR Tax Problem Resolution

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