Adam Brewer from AB Tax Law Joins Main Street Living to answer tax questions.
Valerie Tutson
Welcome back to Main Street living. April brings us many wonderful signs of spring warmer days, tiny new bright green leaves, and flowers popping up all over the place.
Danielle Alvari
Yes, but it also brings something many of us don’t look forward to so much – tax day, but have no fear. We have a tax expert here to simplify even the most complicated tax questions
Danielle Alvari
And now we welcome to Mainstreet living tax attorney Adam Brewer. Adam, thanks so much for making some time for us. Oh, yeah,
Adam Brewer
Yeah, not a problem. Happy to be here.
Danielle Alvari
You know, it’s the time of year when taxes are on all of our minds whether we like it or not. But Adam, you are a Tax Controversy Attorney. So taxes are probably on your mind all the time. What exactly is a Tax Controversy Attorney?
Adam Brewer
Yeah, there’s no escaping taxes for me. So Tax Controversy Attorney, essentially I’m not involved with like the yearly filing so much, quarterly filings that some businesses have to do, I step in when things between the taxpayer and the IRS or the taxpayer in the state get a little messy. So anytime things kind of get off track for a taxpayer – that’s when I’ll step in and help represent the taxpayer before either the IRS or the state.
Danielle Alvari
Well, clearly, nobody wants to run into trouble with the IRS or the state or any of that thing. And, and right now we have tax filing deadlines around the corner. So what is some advice you would give people to avoid some of these problems?
Adam Brewer
Yeah, so this year, it really highlighted four kind of key issues. Some of it’s a continuation from focus areas of prior years, and some of it again, is is a little bit unique to the pandemic. So, first thing we’re really focusing on is any stimulus credits, making sure that if taxpayers already received the stimulus credits, that they’re reporting that on their tax return on the flip side if they haven’t received them, and we want to make sure that they’re claiming that as a credit so that you know ultimately, they either owe less money or are getting a larger refunds. In addition to that, again, cryptocurrency it seems like you know, you can’t really go a day without hearing about cryptocurrency. IRS obviously is aware of that so so they’re kind of stepping up their enforcement on cryptocurrency. Any taxpayers that that either sold cryptocurrency, they mined cryptocurrency, or exchange cryptocurrency, there’s going to be a reporting and disclosure requirement for those transactions. So anyone that that might that might apply to, we just want to make sure that that they’re getting that reported on their tax return. For about the last decade, foreign bank accounts, it’s been a key focus for the IRS. So anyone with what we call a foreign financial account, but but most of the time, that’s either a bank or an investment account held overseas. IRS expects you to disclose that you own that account. And then they expect you to pay tax on any taxable transaction. So if taxpayers own a foreign financial account, or if they even have signatory on a foreign financial account, they need to make sure that’s being disclosed. And then the last one, I think, probably brings in a lot of taxpayers, that’s like the gig and shared economy. So anyone who’s driving an Uber driving for Lyft, Postmates, renting out a place on Airbnb, renting a car on Toro, whatever it may be, there’s going to be a tax reporting requirement there. So you just want to make sure that those tax payers if they’re involved in that, you know, gig or shared economy are making those disclosures. So not just reporting the income, but you also want to report the expenses that that you incurred to generate that income. So, I’d say between stimulus credits, cryptocurrency foreign accounts, and then gig or shared economy, those are I’d say the four areas that taxpayers want to be be wary of this tax filing season.
Danielle Alvari
I want to ask you something real quick, too, because I know a lot of people have been working from home. Is that something that people like to do any tax write-offs for as well if they work from a home office?
Adam Brewer
Yeah, I mean, that’s a tough one because the tax cut and Jobs Act of 2017. That eliminated an itemized deduction that was unreimbursed employee expenses. So this is probably guess maybe the third third filing third or fourth filing with these new roles. But yeah, really kind of bad timing for the pandemic. So some states tend to be the blue states, they’re not conforming with those tax cuts and Jobs Act changes. So they’re, you know, you could claim that deduction on the state side, but it’s not really going to move the needle for you on the federal side.
Danielle Alvari
But that’s at least good to know. It does seem like a lot of people are using an app or software to prepare their taxes. When do you think it’s beneficial for someone to have a professional help them filing their taxes?
Adam Brewer
Yeah, I mean, the apps software, I mean, they can be great, it can save you money, it’s convenient. So if you have like a pretty simple tax return, just you know, reporting wages, and w2 , nothing too complex, then then Yeah, absolutely. Go for it. You know, just follow the prompts. Make sure you, you know, you’re answering it accurately. And you shouldn’t run into any problems. I’d say if you have like self employment income, any of those issues I mentioned above except the credit. So if your tax returns getting a little more complicated, so you do have self employment income, you did sell cryptocurrency or Mining cryptocurrency, you have foreign accounts. If you sold your home, or if you sold a bunch of stock, then it’s probably worthwhile to pay a professional to do the return, just have that peace of mind. If it helps you avoid an audit a year or two from now, it’s it’s definitely going to be well worth the money spent.
Valerie Tutson
And I always think about that for sure. And we talked about the kinds of things that tax controversy attorney does, but what are the most common things that you provide?
Adam Brewer
Yeah, so most of my hours, day to day is spent with my clients who they either owe a large amount of money to IRS or state sometimes both resolving audits, so audit activities really slow down because of the pandemic, just because IRS or the state, they can’t say, hey, come to our office with all your records on this date. But but we do still do some audits. Again, the foreign income, sorry to hit on that again. But it’s just a huge focus area. So especially where I’m at I practice in California, primarily Hawaii. So we have a lot of taxpayers, who, you know, were were maybe born or lived in other countries. So so we see a lot of these foreign accounts, disclosures. And then finally, just people who haven’t filed their tax returns, I know, it’s kind of, you know, an embarrassing topic for a lot of people, but it happens where you just miss a tax year, then before you know it, it’s April, again, one year becomes two two becomes 10 or 30 years, you know, so I do a lot of that which I call like the tax cleanup case, get people back on track, follow delinquent returns, handle any balance dues they have, and then really just get them back on the right track as far as taxes go.
Danielle Alvari
Well, Adam, you found a way to make this conversation not very taxing. So that’s very, very successful on your end. How can viewers get in touch and get more tax help from you?
Adam Brewer
Yeah, definitely. If anyone needs help or looking for more information on taxes, they can visit my website TriumphOverTax.com, or feel free to give me a call at the office. 619-591-9500.
Danielle Alvari
Very cool. Well, thank you so much for joining us, Adam. But I’m sure we’ll see you back here soon.
Adam Brewer
Yeah, thanks for having me. It was a pleasure.
