Property Tax: Assessment Appeals Deadline Extended and Remote Hearings Allowed

For California property tax purposes, effective September 29, 2020, the two-year deadline by which a county board is required to render a final determination on a property tax assessment appeal qualified application is extended until March 31, 2021. For these purposes, a "qualified application" means a pending application for reduction in assessment of property taxes that is timely filed with the county board and has a two-year deadline occurring from March 4, 2020, and before March 31, 2021. Additionally, the law allows the county boards to hear appeals remotely. Remotely conducted hearings include the use of video, audio, and telephonic means for remote appearances; the electronic exchange and authentication of documentary evidence; e-filing and e-service; the use of remote interpreting; and the use of remote reporting and electronic recording to make the official record of an action or proceeding.

Wilson Tax Law Group, APLC (www.wilsontaxlaw.com) is a boutique Orange County tax controversy law firm that specializes in representation of individuals and businesses before federal and state tax authorities with audits, appeals, FBAR, offshore compliance, litigation and criminal defense.  Firm founder, Joseph P. Wilson, is a former Federal tax prosecutor and trial attorney for the IRS and California Franchise Tax Board.  Wilson Tax Law Group is exclusively comprised of former IRS litigators and Assistant US Attorneys from the US Attorney’s Office, Central District of California, Tax Division and Criminal Division.

For further information, or to arrange a consultation please contact: Wilson Tax Law Group, APLC

Newport Beach and Yorba Linda, California

Tel: (949) 397-2292 (Newport Beach Office)

Tel: (714) 463-4430 (Yorba Linda Office)

IRS Reminds Certain Foreign Account Holders of 2019 FBAR Filing Extension

The IRS reminded U.S. citizens, entities and resident aliens with a foreign bank or financial account that they have until October 31, 2020, to file their 2019 Report of Foreign Bank and Financial Accounts (FBAR). FBAR filers impacted by the California Wildfires, the Iowa Derecho, Hurricane Laura, the Oregon Wildfires and Hurricane Sally continue to have until December 31, 2020, to file their FBARs. The IRS coordinated the extension with the Financial Crimes Enforcement Network (FinCEN) for this year only to filers for 2019 FBARs. The filing requirement applies to anyone who had an interest in, or signature or other authority, over foreign financial accounts whose aggregate value exceeded $10,000 at any time during calendar year 2019. The FBAR, FinCEN Form 114, is only available through the BSA E-Filing System website.

Wilson Tax Law Group, APLC (www.wilsontaxlaw.com) is a boutique Orange County tax controversy law firm that specializes in representation of individuals and businesses before federal and state tax authorities with audits, appeals, FBAR, offshore compliance, litigation and criminal defense.  Firm founder, Joseph P. Wilson, is a former Federal tax prosecutor and trial attorney for the IRS and California Franchise Tax Board.  Wilson Tax Law Group is exclusively comprised of former IRS litigators and Assistant US Attorneys from the US Attorney’s Office, Central District of California, Tax Division and Criminal Division.

For further information, or to arrange a consultation please contact: Wilson Tax Law Group, APLC

Newport Beach and Yorba Linda, California

Tel: (949) 397-2292 (Newport Beach Office)

Tel: (714) 463-4430 (Yorba Linda Office)

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DOJ charges Texas billionaire in $2 billion tax fraud scheme

TEXAS - Federal prosecutors charged Texas billionaire Robert Brockman on Thursday with a $2 billion tax fraud scheme in what they say is the largest such case against an American.

Department of Justice officials said at a news conference that Brockman, 79, hid capital gains income over 20 years through a web of offshore entities in Bermuda and Nevis and secret bank accounts in Bermuda and Switzerland. Prosecutors announced that the CEO of a private equity firm that aided in the schemes would cooperate with the investigation.

The 39-count indictment unsealed Thursday charges Brockman, the chief executive officer of Ohio-based software company Reynolds and Reynolds Co., with tax evasion, wire fraud, money laundering, and other offenses.

Prosecutors also announced that Robert F. Smith, founder and chairman of Vista Equity Partners, will cooperate in the investigation and pay $139 million to settle his own tax probe. Smith, 57, stunned a senior class last year when he promised to wipe out the student loan debt of the entire graduating class at Morehouse, a historically Black all-male college.

“Complexity will not hide crime from law enforcement. Sophistication is not a defense to federal criminal charges," said David L. Anderson, U.S. attorney for the Northern District of California. “We will not hesitate to prosecute the smartest guys in the room."

Brockman appeared in federal court from Houston via Zoom Thursday. He entered a plea of not guilty to all counts and was released on $1 million bond, said Abraham Simmons, spokesman for the Northern District of California.

“Mr. Brockman has pled not guilty, and we look forward to defending him against these charges," said his attorney, Kathryn Keneally, in an email.

Prosecutors said Brockman used encrypted emails with code names, including Permit, Snapper, Redfish and Steelhead, to carry out the fraud and ordered evidence to be manipulated or destroyed.

Brockman, a resident of Houston and Pitkin County, Colorado, is chairman and CEO of Reynolds and Reynolds, a 4,300-employee company near Dayton, Ohio, that sells accounting, sales and management software to auto dealerships. The software helps set up websites, including live chats with potential customers, find loans and calculate customer payments, manage payroll and pay bills.

Reynolds & Reynolds issued a statement saying the allegations were outside Brockman’s work with the company and that the company is not alleged to have participated in any wrongdoing.

In 2013, a charitable trust set up by Brockman’s late father withdrew a pledged $250 million donation to Centre College, a small liberal arts school in Danville, Kentucky, where Brockman attended class and once served as chairman of the board of trustees.

At the time the school said it was due to a “significant capital market event” that didn’t pan out. A spokesman for Reynolds and Reynolds said in 2013 that the event was a proposed refinancing deal involving Vista Equity Partners, Smith's company.

According to the indictment, Brockman gave an unnamed individual detailed instructions regarding the proposed gift to the college, including talking points, and directed the person to threaten to pull out if his demands were not met. In August, he instructed the person to cancel the gift.

Prosecutors say that Smith used about $2.5 million in untaxed funds to buy and upgrade a vacation home in Sonoma, California; purchase two ski properties in France; and spend $13 million to buy a property and fund charitable activities at his property in Colorado.

Anderson applauded Smith for stepping up, despite the serious nature of his crimes, which occurred from 2000 to mid-2015.

“Smith’s agreement to cooperate has put him on a path away from indictment," he said.

In 2019, Smith announced to the graduating class at Morehouse College that he would pay off the student loan debt of the entire class, saying that he expected the graduates to “pay it forward.” The estimated cost was $40 million.

Forbes lists Smith as #461 on its billionaires list, with a net worth of more than $5 billion.

He founded the tech investment firm Vista in 2000 and Forbes reports that it now has over $50 billion in assets and is “one of the best-performing private equity firms, posting annualized returns of 22% since inception.” Vista has offices in San Francisco and Oakland.

Wilson Tax Law Group, APLC (www.wilsontaxlaw.com) is a boutique Orange County tax controversy law firm that specializes in representation of individuals and businesses before federal and state tax authorities with audits, appeals, FBAR, offshore compliance, litigation and criminal defense.  Firm founder, Joseph P. Wilson, is a former Federal tax prosecutor and trial attorney for the IRS and California Franchise Tax Board.  Wilson Tax Law Group is exclusively comprised of former IRS litigators and Assistant US Attorneys from the US Attorney’s Office, Central District of California, Tax Division and Criminal Division.

For further information, or to arrange a consultation please contact: Wilson Tax Law Group, APLC

Newport Beach and Yorba Linda, California

 

Tel: (949) 397-2292 (Newport Beach Office)

 

Tel: (714) 463-4430 (Yorba Linda Office)

Treasury Clarifies Loan PPP Forgiveness Application Deadline

The Treasury Department, along with the Small Business Administration, on October 13, 2020, issued updated Frequently Asked Questions (FAQs) on the Paycheck Protection Program (PPP), following up on new guidance issued on October 11 simplifying the forgiveness process for certain loans.


The updated FAQs, as related to the new guidance, specifically provides the timeline for applying for loan forgiveness. The FAQ also seeks to clear up confusion related to an expiration date listed in the loan forgiveness application forms (3508, 3508EZ, and 3508S).


The full text of the FAQ can be found here.


Wilson Tax Law Group, APLC (www.wilsontaxlaw.com) is a boutique Orange County tax controversy law firm that specializes in representation of individuals and businesses before federal and state tax authorities with audits, appeals, FBAR, offshore compliance, litigation and criminal defense.  Firm founder, Joseph P. Wilson, is a former Federal tax prosecutor and trial attorney for the IRS and California Franchise Tax Board.  Wilson Tax Law Group is exclusively comprised of former IRS litigators and Assistant US Attorneys from the US Attorney’s Office, Central District of California, Tax Division and Criminal Division.

For further information, or to arrange a consultation please contact: Wilson Tax Law Group, APLC

Newport Beach and Yorba Linda, California

Tel: (949) 397-2292 (Newport Beach Office)

Tel: (714) 463-4430 (Yorba Linda Office)






California—Property Tax: New Construction Exclusion Enacted

A new construction California property tax exclusion is enacted for property damaged or destroyed by a Governor-declared disaster.

New Construction Exclusion Conditions

For property that has been substantially damaged or destroyed by a Governor-declared disaster on or after January 1, 2017, a construction exclusion for comparable property that is reconstructed on the site of the damaged or destroyed property is available under the following conditions:


  • the property must be substantially damaged or destroyed by a disaster, misfortune, or calamity, as declared by the Governor;

  • the property is substantially damaged or destroyed if the improvements sustain physical damage that amounts to more than 50% of the improvements' full cash value immediately prior to the disaster;

  • reconstructed property is comparable if it is similar in function, size, and utility;

  • only the owner(s) of the property substantially damaged or destroyed is eligible to receive this relief; and

  • construction must be completed within five years of the date of the damage or destruction.


Comparable Reconstruction

Reconstructed property is comparable if it is similar in function, size, and utility as follows:

  • property is similar in function if it is subject to similar governmental restrictions, such as zoning; and

  • property is similar in size and utility if is used or intended to be used in the same manner and its full cash value does not exceed 120% of the full cash value of the damaged original property, determined just prior to the date of damage/destruction.


If the full cash value of the reconstructed property exceeds the 120% threshold, the amount above 120% will be added to the transferred base year value.

Applicability Date

These provisions apply to real property damaged or destroyed by misfortune or calamity on or after January 1, 2017.

Ch. 124 (A.B. 2013), Laws 2020, effective January 1, 2021, and applicable as noted.

Wilson Tax Law Group, APLC (www.wilsontaxlaw.com) is a boutique Orange County tax controversy law firm that specializes in representation of individuals and businesses before federal and state tax authorities with audits, appeals, FBAR, offshore compliance, litigation and criminal defense.  Firm founder, Joseph P. Wilson, is a former Federal tax prosecutor and trial attorney for the IRS and California Franchise Tax Board.  Wilson Tax Law Group is exclusively comprised of former IRS litigators and Assistant US Attorneys from the US Attorney’s Office, Central District of California, Tax Division and Criminal Division.

For further information, or to arrange a consultation please contact: Wilson Tax Law Group, APLC

Newport Beach and Yorba Linda, California

Tel: (949) 397-2292 (Newport Beach Office)

Tel: (714) 463-4430 (Yorba Linda Office)