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Tax Articles

IRS Releases Form 8941 to Help Small Businesses Claim New Health Care Tax Credit

The Internal Revenue Service released a draft version of the form that small businesses and tax-exempt organizations will use to calculate the small business health care tax credit when they file income tax returns next year. The IRS also announced how eligible tax-exempt organizations –– which do not generally file income tax returns –– will…


How to obtain copies of tax returns and canceled checks from the Colorado Department of Revenue

Taxpayers who need to get copies of Colorado tax forms (including electronically filed returns) and canceled checks submitted to the Department of Revenue must use the “Request for Copies” form DR 5714 available on the Colorado Taxation Web site through this link: NOTE: In an effort to avoid identity fraud, the department requires taxpayers…


Release of IRS Lien/Levy due to hardship

IRC Sec. 6343(a)(1) provides that, if under regulations prescribed by the secretary, the secretary has determined that a levy is creating an economic hardship due to the financial condition of the taxpayer, the secretary must release all or a part of the taxpayer’s property or rights to property. A levy creates an economic hardship due…


Tax Avoidance Transaction – ROBS – Rollover as Business Start-up

ROBS – Rollover (of tax deferred or retirement $$) as Business Start ups – arrangements were created to secure available funds held in tax-deferred savings (usually under a prior employer’s plan) for an aspiring entrepreneur without incurring resultant tax liabilities that would ordinarily apply to a distribution. Whether ROBS are abusive or not is a…


New reporting rules for passive activities force group decisions

As part of the IRS’s continuing efforts to require greater disclosure of tax positions and strategies on returns, it recently released new, mandatory disclosure rules for grouping passive activities. Rev. Proc. 2010-13 for the first time mandates that passive-activity groupings and regrouping, as required under Code Sec. 469 regulations, be disclosed on the taxpayer’s return.…


Charitable Donations – Tax Tips

Charitable contributions must be made to qualified organizations to be deductible. You can ask any organization whether it is a qualified organization and most will be able to tell you. Charitable contributions are deductible only if you itemize deductions using Form 1040, Schedule A. You generally can deduct your cash contributions and the fair market…


IRS Notice – what to do ….

There are number of reasons the IRS sends notices to taxpayers. Each letter and notice offers specific instructions on what you need to do to satisfy the inquiry. If you receive a correction notice, you should review the correspondence and compare it with the information on your return. If you agree with the correction to…


Employee vs. Independent Contractor: Business Owners Tips

As a small business owner you may hire people as independent contractors or as employees. There are rules that will help you determine how to classify the people you hire. This will affect how much you pay in taxes, whether you need to withhold from your workers paychecks and what tax documents you need to…


Innocent Spouse Consideration – 5 Requirements

There are five requirements the IRS assesses as part of granting innocent spouse relief: 1. Education Level – Does the innocent spouse possess the skill set, background, and/or experience to understand the jointly filed tax return? 2. Involvement in Financial Affairs – To what extent did the innocent spouse participate in financial decisions? 3. Large…


If you owe the IRS money, here are some tips …

If you get a bill this summer for late taxes, you are expected by the IRS to promptly pay the tax owed including any penalties and interest. First you should consider appealing the determination based on merit and evidence. For more information on appeals feel welcome to contact me directly at 720-234-1177 or at…