Many taxpayers are unaware of enforcement procedures that can be used against them to collect back taxes. The difference between how New York and the IRS collect on that money may not seem crucial. However, it is important to understand how New York State tax warrants and federal tax liens work in order to avoid them or take appropriate steps to challenge them. [Read more…]
The New York State Department of Taxation and Finance (“DTF”) is entering the 21st century with improved online offerings for both taxpayers and tax professionals. On June 27, 2017, the DTF released a new and greatly simplified Power of Attorney form, which may be filed online as well as on paper. The new form, reduced to one page from four, eliminates the requirement of notarization and requires only the taxpayer’s signature, not those of the representatives. Furthermore, the new form, when filed, only revokes existing powers when explicitly indicated, a change that should ease the process of adding additional representatives on to an existing power. However, the transition to the new form does involve some complications of which practitioners should be aware. [Read more…]
When determining Medicaid eligibility, the Department of Social Services (“DSS”) is required to “look back” for a period of 60 months immediately preceding the first date the applicant was both “institutionalized” and had applied for Medicaid benefits to determine if any asset transfers were uncompensated or made for less than fair market value. If such a transfer was made during that period, the Medicaid applicant may become ineligible for Medicaid benefits for a specified period of time, unless the Medicaid applicant can prove that the assets were transferred exclusively for a purpose other than to qualify for medical assistance. Burden of proof: it is the Medicaid applicant’s burden to rebut the presumption that the transfer of funds was motivated, in part if not in whole, by anticipation of a future need to qualify for medical assistance. [Read more…]
A recent court decision by the US Court of Appeals for the 11th Circuit found a shareholder and employee of a defunct company was liable for his share of the company’s tax debt problems. The case was particularly hard on the taxpayer since he was a victim of the majority shareholders’ fraud, but was still found to be responsible for repaying monies he had received. [Read more…]
Are restaurants shut down for unpaid taxes more often than other businesses? A recent article in the Albany Times Union looked at the high number of restaurant closings every year for nonpayment of sales or withholding taxes.
Why are restaurants seized so often? Constant cash flow issues and low profit margins characteristic of the industry can make it hard to stay on top of sales tax payments. Unfortunately, if restaurant owners fail to address their tax issues promptly, they risk losing their businesses. In addition, they may find themselves with personal liability for unpaid taxes as a “responsible person” under sales tax laws. [Read more…]