What action can I take against the IRS for refusal to pay me my 2002 income tax refund

With respect to a claim for refund, you generally must file the claim within the later of 3 years from filing the return or 2 years of paying the tax. Filing a return 3 years late does not bar a refund claim. Your claim for refund will, however, be limited to the amount of tax paid within the previous 3-year period. So, if your income tax was paid throughout the 2002 tax year and you filed your return on April 15, 2006 (three years late), your refund claim would be limited to the amount of...

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Forming an LLC and want to leave additional room for future investors

Reserving the 30% can be done by simply having a separate class of units -- that way you can issue units in the 30% class without diluting the 70% units. You need to find someone in your area that has expertise with LLCs and partnership tax.

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We made a business to our son-in-law (now ex) in July 2009. Nothing has been paid toward it. How do we call it in?

You are going to need to begin collection action against your former son-in-law, obtain a judgment, and then collect on the judgment. I'm in West Chester -- contact me if you are interested in moving forward.

How do I take my name off an LLC?

It may be as simple as assigning your interest in the LLC to your brother. If you and your brother are the only owners and if you are currently taxed as a partnership, then your departure will terminate the partnership and your brother will be left with a single-member LLC that by default will be taxed as a sole proprietorship.

Can I claim percentage of year-end loss of LLC on my taxes if I sold my shares to remaining partners during the year?

Unless all of the business activity occurred after you terminated your interest in the partnership (assuming it is taxed as a partnership), then your K-1 is wrong. Your partnership tax year ends on the date you completely terminate your interest. The Treasury Regulations contain a variety of methods on how income, gain, loss, and deductions are allocated with shifting interests of partners (Prop. Reg. 1.706-4). This approach does not likely fit one of those methods. You need to request a...

Please help me determine residency for tax purposes

Residency for state tax purposes generally begins with a person's "domicile" which not only incorporates a physical residence but also an intent to permanently or indefinitely reside in that state. There are also a number of factors a state may look at -- home ownership, voting registration, location of bank accounts, titling/registration of motor vehicles, etc. If you have only one home and it is in Wyoming, and you have essentially moved all of your accounts/business/etc. over to Wyoming,...

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IRS Audit on a Sold Business

Depends on the type of tax -- if we are talking about unpaid employment taxes, then a former owner could be deemed a "responsible party" and have personal liability (trust fund -- civil penalty), regardless of the current ownership. If we are talking corporate income tax, then the IRS would need a different theory to recover from a prior owner -- claiming you were an "alter ego" of the corporation, there was a fraudulent transfer of assets, or you held the assets that could have been used to...

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What are the tax implications of 'paying back' an initial LLC investment?

Assuming this LLC is taxed as a partnership, the initial investment created "basis" for each partner equal to their contribution. If the partnership had losses in early years, these losses would have decreased each partner's basis -- acting as a return of that investment (loss is taken against the partner's other ordinary income). When the LLC begins to sustain, the LLC's income is allocated to the partners -- increasing their basis. When that income is distributed, the partner's basis is...

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I have a Wyoming Multi-Member LLC that I want to convert to a Single-Member LLC. Is that possible? If so, how to I do it?

The simple answer is to have your wife transfer her interest to you -- this automatically converts the multi-member LLC to a single-member LLC. The question of whether that transfer can be done retroactive to formation depends on the activities of the entity to this point and whether an interest was actually issued to your wife. It is my understanding that Wyoming is not a community property state, so I would question whether you and your wife can be considered a single member. I am not a...

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We were audited without knowledge or notice given and assessment made by Revenue department with falsified info.

Tough to follow the facts here -- would need more information on these "fraudulent invoices" and how they resulted in tax liability. Is this by chance related to unpaid employment taxes?