Individual Strategies

What Clients Should Know About Innocent Spouse Relief

Some clients marry into tax trouble – and then have no clue how to get out. Others are on the cusp of a separation or divorce and want the uncoupling (at least in the eyes of tax authorities) to start ASAP. Few clients who need the IRS tool called “innocent spouse relief” to unshackle themselves from a spouse’s tax mess (either one that spouse brought to the marriage or one they racked up later) seem to know about it. Here’s what to tell such a client about what this relief does and does not cover and what your client will have to prove before they can qualify – as well as how difficult this relief can be to get.

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Think Outside the Tax Box provides tax reduction strategies along with practical implementation advice in order to reduce your clients’ federal tax bill with ease.

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CURRENT EDITION

2025 Tax Surprises You Shouldn’t Overlook

Annette Nellen, CPA, CGMA, Esq.

There are a few tax rules new for 2025 that may catch some individuals and their tax advisers by surprise. These changes have not received lots of attention either because they are overshadowed by related changes that are more significant, or they were enacted a few years back with a future effective date that arrives in 2025. This article covers changes for 2025 that you will want to be sure to share with clients to avoid surprises at a later date.

Leaving the United States, Part I: Expats

Keith Schroeder, EA

When Americans speak of leaving America, they generally are expressing a desire to live elsewhere in the world for cultural reasons or due to cost of living. These people are called expatriates, aka expats. For clarity, a mere visit to another country does not make you an expat. To be an expat, the move needs to be long-term and often includes working or retiring in the new country. Expats live somewhere outside the U.S., but still have a tax obligation to the U.S. and possibly the country they move to. That will be the focus of this article.

Tax Preparer Hit with Stiff Sentence

Peter J Reilly CPA

John Anthony Castro is a colorful character. He entered several Republican primaries seeking the Presidential slot after failing to win the primary for a Senate seat representing Texas. He sued to have our once and future President Donald Trump be removed from the ballot on Fourteenth Amendment Section 3 grounds. As we can easily infer, those suits went nowhere. But more than anything, John Anthony Castro was a tax guy with a virtual practice with locations in four cities. Not anymore. Now he is resident in a Bureau of Prisons facility – the Federal Medical Center Fort Worth. On October 30, 2024, Judge Terry Means sentenced Castro to 188 months in prison, followed by one year of supervised release and restitution of $277,243, following his conviction on 33 counts of “Aiding and Assisting in the Preparation and Presentation of a False and Fraudulent Return.” Does the sad story of John Anthony Castro hold any lessons for us? Perhaps.