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Patel Law Offices Blog

IRS Issues Reminders for FBARs and other International Requirements

The Internal Revenue Service today reminded U.S. citizens and resident aliens, including those with dual citizenship, to check if they have a U.S. tax liability and a filing requirement. At the same time, the agency advised anyone with a foreign

How To Limit An Executor’s Personal Liability For A Decedent’s Unpaid Taxes

Being an executor can often be a demanding and thankless task. In addition to coping with the loss of a close friend or family member, executors are routinely charged with navigating estate plans through an unfamiliar and intimidating course of

Using the 65-day rule as an opportunity for income tax savings for estate

One of the tax planning tools available to executors of estates is the 663(b) election, also known as the “65-day rule.” Simply put, a 663(b) election allows distributions made to beneficiaries within 65 days of year-end to be counted as

New Jersey Department of Revenue publishes “Manual of Audit Procedures”

On March 7th, the New Jersey Department of Revenue released its “Manual of Audit Procedures” to the public, which is intended to provide a comprehensive overview of the procedures and guidelines available to it for completing all types of audits,

Individuals with disabilities can create their own self-settled trusts

The Special Needs Trust Fairness Act provides that individuals with disabilities can now create their own special needs trusts instead of having to rely on others. The Act was included as Section 5007 of the 21st Century Cures Act which was signed into law

Avoiding and Defining Willfulness

U.S. taxpayers with unreported foreign accounts or assets are in a challenging position. The IRS has repeatedly announced that it is devoting resources to finding and penalizing taxpayers who do not disclose such offshore accounts and assets. In addition, many U.S. taxpayers,

Common Issues for US-India Tax Reporting

US-India Cooperation: In 2015, India and the US signed an agreement to implement the Foreign Account Tax Compliance Act (FATCA) that will facilitate exchange of information between the two countries starting on October 1, 2015. Under the  agreement, Indian financial

New Form Updates for Foreign Accounts

The government has made a few recent form updates regarding the filing requirements for the following forms:  FinCEN Form 114 (Report of Foreign Bank and Financial Accounts) – automatic extension granted  Form 8938 (Statement of Specified Foreign Financial

IRS Letters and Notices Offering an Appeal Opportunity

There are many missed opportunities to solve tax problems with the IRS through the IRS Appeals office. Below is a list of the most common IRS letters and notices affording an IRS appeals opportunity. Letter 11 – Final Notice of

ABA Conference with Government Officials

The ABA recently held a conference titled National Institute on Criminal Tax Fraud and Institute on Tax Controversy.  I attended the conference where many tax attorneys and government officials discussed issues of interest. Also discussed was the effect of streamlined

Beware of FATCA Letters

FATCA letters (sometime called Self Certification letters) are going out from banks around the world to millions of US expats in readiness for reporting their financial information to the Internal Revenue Service (IRS). If you are one of the 8

IRS Most Common Tax Notices and What They Mean

The IRS has redesigned its correspondence notices to be more “user friendly.”  This is supposed to make their notices easier to understand and therefore allow responses to occur in a more effective and efficient manner.  IRS tax notices will now

US Taxation of Foreign trusts: Foreign grantor trust

What is a foreign grantor trust (“FGT”). A FGT is typically used when a non-U.S. Person individual (i.e., an individual who is a non-U.S. citizen, not a “green card” holder, or otherwise not considered a U.S. income tax resident) wishes

5 Estate Planning Tips to Avoid Disputes

Insert a no-contest clause When a will contest seems likely, an in terrorem clause may be beneficial. An in terrorem clause, also known as a “no-contest” clause, generally provides that a bequest will fail if the beneficiary initiates or participates

Action Required: New Jersey Estate Tax is Repealed

Earlier this month, on October 14, 2016, New Jersey Governor Chris Christie signed into law that increased the NJ Estate Tax exemption from $675,000 to $2 million for deaths in 2017, and fully eliminated the state estate tax in full

New Jersey to repeal estate tax

Last week, the New Jersey legislature announced its plan to repeal estate tax by January 2018.  The New Jersey estate tax is presently one of the highest in the nation. For state residents the estate tax exemption would be increased

Resolving IRS disputes through audit reconsideration

An audit reconsideration is defined by the Internal Revenue Manual (IRM) as: the process the IRS uses to reevaluate the results of a prior audit where additional tax was assessed and remains unpaid, or a tax credit was reversed. If the

Taxation of Employment-related Discrimination Claims

Proceeds from a settlement involving an employment-related discrimination case may be taxable to the employee under some circumstances and not taxable in others.   Non-taxable settlement amounts: Medical expenses associated with medical distress; Emotional distress, pain or suffering resulting from

Planning strategies for small settlements

MYTH: Where a settlement is small (less than $50,000.00), the client should not use a Special Needs Trust or other planning technique, but should simply allow himself (herself) to become disqualified until the settlement money is gone. This perspective is

Article Discusses Termination of Offshore Voluntary Disclosure Program (OVDP) and the Streamlined Filing Compliance Procedures (SFCP)

The Internal Revenue Service (IRS) currently offers non-compliant US taxpayers several different relief programs in which to report foreign assets and/or income and become compliant with US rules related to the disclosure of foreign assets. One option is the Offshore