Recent Supreme Court case emboldens states to test limits of taxing authority

A recent Supreme Court opinion is likely to embolden states to test the limits of their taxing authority by limiting the ways taxpayers can challenge the taxes in court. In Franchise Tax Board of California v. Hyatt, Justice Thomas, writing for the Court, held that states have an inherent sovereign immunity protecting them from law suits in other states. Therefore, according to Thomas, plaintiffs can only sue states in other states if the potential defendant state itself decides to waive the immunity.

While, on the surface, this may not seem likely to impact state tax laws, it is expected that the change will permit states to push the limits of what states have historically been allowed to do. Therefore, it is easy to see how states could use this new precedent to increase the scope and number of enforcement actions against people in other jurisdictions that may owe taxes to the state.

Nobody knows for certain what the long term impact of Hyatt will be but it is definitely something businesses should consider; especially as the new rules for the collection of interstate sales tax begin to emerge from the various states.

If you have any questions or concerns about this topic or any legal or tax matter, contact P. Christopher Wegner at 239.449.9200 or cwegner@wegnerlawfirm.com. You can also visit www.wegnerlawfirm.com any time of day to learn about the law firm is helping businesses grow.

Small business week

We would like to take this opportunity to thank all of the small businesses in the area that trust us for their business and tax law needs.

Ninety-nine point nine percent (99.9%) of all businesses in the United States are small businesses and we are here to serve everyone of them. We only serve businesses and most of our practice is small to mid-sized businesses like yours that need top notch legal advice at reasonable prices.

If you need an attorney to help your small business with formation, capital raising or day to day legal, give us a call. Our initial consultation is free but our advise is invaluable.

Wegner enters into affiliation with ABN-Law PLLC

ABN-Law PLLC logo.Wegner Law PLLC and ABN-Law PLLC enter into an affiliation agreement to offer more valuable legal services to clients. For Wegner Law PLLC, this means the firm’s business clients will have access to a full range of litigation and real estate services from the trail blazing attorneys at ABN-Law PLLC.

By entering into this arrangement, Wegner Law PLLC marshals the attorneys and experience to truly provide full service legal advice to small and mid-sized businesses in the Southwest Florida area.

Visit the Wegner Law PLLC website in the near future to learn more about this exciting new partnership of the most business minded law firms in Collier and Lee County.

Section 199A Regulations Released

The IRS has released the long hoped for final regulations for the deduction under Section 199A. While most of the regulations were pretty much as expected, there are some surprises allowing taxpayers more freedom in how they calculate their maximum deduction under the Code.

However, not all of the news is good news and the broad anti abuse rules threaten to sweep up well meaning tax payers and deprive them of their full deduction for missing arbitrary deadlines. Even if you are not the type to engage in tax planning to lower your taxes, the new rules are poised to punish taxpayers who do not do minimal planning by sharply increasing their taxes.

As always, call or email P. Christopher Wegner at 239.499.9200 or cwegner@wegnerlawfirm.com today for a free consultation as to how Section 199A will impact you.

Wegner Closes on $750,000 Debt Offering

Wegner Law PLLC was the lead attorney for an entertainment company in Orlando, Florida, that raised $750,000 through a sale of equity and debt. The client contacted P. Christopher Wegner after splitting with their original attorney who failed to provide timely and comprehensive services. In less than two weeks, Chris worked with the client to draft a whole new set of key documents make sure the startup was ready for their time in the spotlight.

Wegner Law PLLC Helps Client Raise $1.8 Million

Wegner Law PLLC helped a small agricultural start up raise $1.8 million in a successful offering that closed in early January. The company provides essential products to growers in the hemp and legal marijuana businesses.

P. Christopher Wegner was lead attorney and advised the client at every step of the process. Mr. Wegner negotiated and drafted all of the documents and agreements necessary to close the deal.

To learn more about how Wegner Law PLLC can help you, call us at 239.449.9200 or email us at cwegner@wegnerlawfirm.com.

IRS to collect taxes and issue refunds during shut down.

As the government shutdown enters its third week, agencies are scrambling to determine what the shutdown means to them. For the Internal Revenue Service (“IRS”), there was never any question that they would continue to collect taxes regardless of what happened.

Initially the concern was whether the agency could process refunds during the Washington D.C. imposed hiatus.  However, the White House issued guidance on Monday that will permit the executive agency to process and mail tax refunds while the government is closed.

IRS to use new tool in audits

The Internal Revenue Service recently issued a Request for Proposal to software companies for specialized software to comb through social media and collect information on audit suspects. It is not clear when the new program will start; however, in the RFP, the IRS expressly stated that the software is to target those already under audit and not to sweep social media for potential audit targets.

Regardless, this is yet another reason businesses and individuals need to be careful with their official and personal posts on Facebook, Instagram, Twitter, etc.

 

IRS turns to artificial intelligence to identify potential audits

The Internal Revenue Service is adding artificial intelligence (or “AI”) to the agency’s tool box for identifying potential audits or criminal tax evaders. The AI works by taking in all available information from past and present IRS audits and prosecutions to discover any pattern of factors that results in more changes at audit or convictions for tax fraud.

The AI will then apply any patterns when reviewing new tax returns and mark any that the computer thinks demonstrate increased likelihood of significant changes under audit or criminal conviction.

As voluntary compliance with US tax code is declining and the number of tax returns the IRS most process, expect the Service to turn to more and more advanced technology like AI in its fight to collect as much money as possible.

If you want advice on avoiding problems in the future or you under audit and need help now, contact P. Christopher Wegner at 239.449.9200 or cwegner@wegnerlawfirm.com.

 

New Business Owner Beware!

If you just formed a new business in Florida, you will start receiving all types of unsolicited mail. Some of the mail will look official and display names such as “Florida Corporation Register Inc.” or “Florida Annual Reports LLC.” These letters almost always start with some form of warning or call to action in big bold or red letters instructing you to do any of a number of things supposedly required to keep your new company open.

The letters will then include some sort of form asking for information and telling you to send check or money to an address in Tallahassee. Everything from the envelope to the print is made to appear official.

The problem, they are not official. Countless companies inundate new business owners with letters attempting to take money from an unsuspecting small business owner. Each company trying to take between $50 to $250 from the confused entrepreneur.

While some of these letters are very convincing, you may disregard any letters that you receive via the mail regarding a newly formed business. The State of Florida only contacts business regarding their state registration or annual report via email. Therefore, you can save a significant amount of frustration, uncertainty and money by throwing out any imposter asking for money via the postal service.

In addition, as we approach the new year and the limited liability companies, partnerships and corporations have to file their annual reports with the State of Florida, there is another scam business owners should know about. Almost everyone has seen a letter claiming the need to file corporate records with the state. The State of Florida does not require businesses to create or file any corporate or company minutes or other similar records.

Starting a new business can be scary and it is hard enough without con artist and scammers working hard to take advantage of you. Hopefully, this post will help Florida business owners avoid becoming prey to these scams.

If you are confused or concerned, you can always come to Wegner Law PLLC for help. Call 239.449.2900 or email cwegner@wegnerlawfirm.com for answers to all your questions.