California’s Attempts to Circumvent the New Tax Law’s SALT Limitation

Reports indicate that low-income and middle-class Californians are fleeing the state – most are relocating to Arizona, Nevada, and Texas. The reason? Housing costs and high taxes. The new tax law hasn’t necessarily helped wealthy California homeowners, either. For one thing, the Tax Cuts and Jobs Act (TCJA) capped their...

$125,000 State Tax Problem Fixed by Correcting Previous Years’ Tax Returns

A Moskowitz LLP Success Story A business owner came to us after receiving a Franchise Tax Board (FTB) Notice. The Notice stated that the FTB was disallowing a $1,204,541 million corporate loan to shareholder, and consequently assessed $125,197 in additional state income taxes. There is a long history of IRS...

Taxpayer Win: Failure to File Accurate FBAR Deemed Not Willful, Part IV

The story of Arthur Bedrosian, CEO of Lannett Company, Inc., and his Swiss bank accounts shows how a taxpayer’s cooperation with an IRS investigation and the court’s belief in the taxpayer’s honesty can be significant factors in the outcome of an FBAR penalty case. In Part III, we provided an...

Taxpayer Win: Failure to File Accurate FBAR Deemed Not Willful, Part III

Before the Offshore Voluntary Disclosure Program (OVDP), it was rare for a taxpayer to pay penalties when they voluntarily came forward with information regarding their foreign accounts. Most tax practitioners, therefore, recommended that their clients do a “quiet” disclosure, which involved simply amending their previous years’ returns, and paying any...

Taxpayer Win: Failure to File Accurate FBAR Deemed Not Willful, Part II

In Part I, we described the background of Bedrosian v. United States, 3d Cir., No. 17-3525, in which the CEO of a pharmaceutical company was pursued for willful FBAR penalties. The IRS didn’t go after Arthur Bedrosian for his many years of noncompliance with foreign reporting obligations, but rather for...

Taxpayer Win: Failure to File Accurate FBAR Deemed Not Willful, Part I

The IRS aggressively pursues taxpayers for FBAR noncompliance, but in this case it may have overreached its boundaries. CEO takes bad advice Arthur Bedrosian is currently Chief Executive Officer of Lannett Company, Inc., a manufacturer and distributor of generic medications. In the early days of his career (1970s) he frequently...