November 28, 2009

Guilty in Error Guilty on Purpose

Guilty in Error

Wood County in Wisconsin was fined $49,450 by the IRS for submitting 2007 payroll forms late. On Monday, the county leaders received a notice from the IRS dated August 17th informing them of the fine and imposing a 45 day period for them to appeal, failing which to pay up. Ed Reed, County Human Resource Director said that the county would most likely appeal.

The county intends to appeal for a reduction or waiver of the fine. Under federal law, the county must annually file employee W-2 forms in both hardcopy and electronic forms to the Wisconsin Department of Revenue by January 31st and to the Social Security Administration by March 31st. The county had never failed to file any of these documents in the past. But unfortunately in late 2007, the county's employee in charge of payroll and benefits unexpectedly resigned leaving the other staff members to carry out the task. As a result, the electronic versions were not filed.

When the county's new staff for payroll and benefits took over, she found the oversight and informed county officials who promptly reported it to the IRS. The required electronic forms were immediately filed with the IRS. It is for this reasons that the county plans to appeal for a lower fine or for it to be waived altogether.

Despite the error, Reed commended the staff for their excellent work in preparing the documents, saying they were some of the most accurate prepared by the county in years.

Guilty on Purpose

Janet Ramirez, who runs a tax preparation service pleaded guilty to filing false tax returns for some of her clients. Ramirez from Hammonton, the owner of Primetax Associates in West Landis Avenue in Vineland, New Jersey filed false itemized deductions on Schedule A forms and business expenses in Form 2106 for her clients. US District attorney Ralph J. Marra Jr. said that she did so for 18 clients on about 50 tax returns between 2003 and 2007.

These false claims resulted in over $121,000 of lost taxes to the government.

Ramirez pleaded guilty before US District Court Judge Joseph E. Irenas who released her on a $100,000 bail pending sentencing on December 4th. The crime of submitting false and fraudulent tax returns carries a maximum penalty of 3 years' imprisonment and a fine of $100,000 or twice the loss to the IRS or gain to the defendant, Ramirez.

There is no parole given in federal criminal justice system.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

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