Business Law

Business Tax

• Audit Defense
• Corporate Income Taxes
• Excise Taxes
• International Taxes
• IRS Disputes
• Negotiating Payments & Settlements
• Payroll Taxes
• Property Taxes (Ad Valorem Taxes)
• Sales Taxes
• Tax Evasion Defense
• Tax Filing & Compliance

1

Texas

I specialize in Tax for small-to-medium sized businesses, self-employed individuals, and individuals whose returns require special attention. My major areas of expertise include:

•Tax return preparation and filing: finding/utilizing every money-saving tax break you deserve — even for the most complex situations.
•IRS issues: solving critical issues such as non-filings, late filings, audits, appeals and offers-in-compromise.
•Other tax services: handling estate, gift, income, payroll, property & sales taxes.
•Proactive tax planning: analyzing future tax reductions to take into account when planning budgets and cash flow.
•Retirement planning: identifying and applying contributions that will enhance your tax savings and retirement positions.

I've been in private practice, serving clients in Dallas and a 200-mile radius, for over 20 years. I work as a sole practitioner with my support staff and have a network of other professional CPAs and attorneys for consulting. By taking this approach, I am able to work directly and personally with each one of my clients to provide maximum support.

Previously, I was a manager for Deloitte - one of four largest CPA firms in the U.S. However, I was delighted to move on to my own practice where I could focus on people vs. Fortune 500 corporations.

•Volunteer: Legal Aid; Big Brothers Big Sisters of America
•Honorary: Phi Delta Phi (Legal Honorary); Phi Beta Kappa
•Interests: Family; Michigan football; Texas Rangers baseball; Opera; Fishing; Horse racing

The following two Case Studies represent common tax problem situations and our solutions for them.

#1
This case study involves different tax refund solutions for two clients ("A" and "B") who co-invested in an Oil & Gas venture that failed. I was able to save both clients approximately $50,000 apiece through precise application of less-common tax laws.

Client A Situation
In 2000, my Client A (who became my client in 2004) and his sister (who became my client in 2011) each invested $100K in an Oil & Gas venture.

Each also received a $50K Section 29 Oil & Gas Credit in 2001. Unfortunately, the initial venture failed in 2003, and each took their write-off via the investment loss, but each was also left with the 2001 tax credit carry-forward.

My Solution
My Client's credit was not available against AMT tax, but we absorbed it with the AMT credit reversals available from 2006 to 2009.
•Client A Savings: $50,000

Client B Situation
Seeing that her brother got full application of his AMT credits in 2006-2009, my Client's sister came to me in early 2011. Her original preparer had mistakenly tried to offset the credit in 2001 against the AMT. The IRS, on Audit, correctly disallowed the offset in 2003. No one, however, went back to 2001 to re-establish the Sect 29 Credit benefit as a carry-forward. Consequently, it was forgotten about until 2011, with no benefit to the sister from this huge credit.

My Solution
What was unique about this case was that the only way to get a benefit from the credit was to prepare amended returns for each of the closed years—2001-2006. In doing that, I was able to re-establish the existence of the credit carry-forward, and I also was able to show the IRS how much of the credit was utilized (or lost in the closed years). To our amazement, we got back almost all of the $50K benefit (in open years 2007-09).
•Client B Savings: $49,000
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#2
This case study features a client who tried to handle his own 2006-2007 business tax returns plus a subsequent (and losing) IRS audit from a foreign country. As a result, the IRS assessed additional penalties and interest which would have eliminated all of his retirement savings. The case was referred to me by a client.

I won the audit on appeal and got the case dismissed with no tax payment or penalty assessed.

Client Situation
The client owned a jewelry store in Texas for many years. He closed it, retired and moved to Costa Rica. Then he received an IRS audit notification covering the last two years he had operated the store. Unfortunately, all his business records had been lost in the move. So when he returned to the U.S. to meet with the auditor, he could only produce copies of business bank statements.

Using the bank statements, the auditor concluded that neither the income nor the cost of sales (COS) numbers matched the return or could be supported. However, he ultimately accepted the COS numbers - for lack of any other documentation — and used statistical reasoning to propose an income number that was over 300% greater than the amount reported on the original tax returns.

My Solution
I asked the auditor to provide me with the same statements the client provided him. I then made a simple Excel spreadsheet and asked the client to separate each of the 24 months' income and expenses into 12 business categories plus one "Personal" category. I used this information to develop the organized documentation needed to appeal the case and win it.

There are two unusual points about this case:
•I used the same materials with the auditor that my client did, and
•The auditor, the client and I worked entirely over the internet.

I believe that my organization and presentation won the case. Additionally, I proved that the bank statement's monthly income was the verifiable number, and using the Auditor's statistical rationale, determined the COS as 40% of that number (to the taxpayer's advantage). The COS would otherwise have been zero for lack of support, as the underlying COS records were lost.

Summary
If necessary, tax records can be reconstructed three to four years after the fact if income and expenses are maintained in one account. Then, knowledgeable organization and presentation become 80-90% of winning.

Our professional Office Manager & Controller is Melissa Serpa. She has been with our firm for 10 years, joining the practice when she graduated from Texas A&M.

(214) 363-1485

Monday through Thursday 9:00 a.m. to 5:00 p.m.; and Friday 9:00 a.m. to 3:00 p.m.
Emergency Hours scheduled as needed.

No

We have two employees who are completely bi-lingual in Spanish/English (Mexican dialect). Que hablan Espanol.

Fees vary depending specifics/scope of your particular needs and related services required.

Basic Business Return Preparation — from $575
This fee assumes that you can provide us with up-to-date, electronic financial statement data.*

Basic Individual Return Preparation — from $350
This fee assumes that all of your records are current.*

Additional Returns and Forms - $175 per hour
If you have additional tax returns — such as Franchise, Property or Excise — we'll provide an estimate.

IRS-related Services - $175 per hour
Fees for handling audits, unfiled taxes, late taxes or another problem involving IRS, state or local jurisdictions are charged hourly. While a fixed estimate of hours is not feasible, we do make every effort to get an expeditious resolution.

Additional services - can be found at our website, http://www.elwellinc.com

$175 per hour

Discounts — 20% off initial meeting for mentioning Nolo; 20% off services for active members of the Armed Services and their families

Additionally, we provide a free 30-minute initial "diagnostic" phone conference (by appointment). We'll discuss your specific needs and how I can best help you.

Payment - we accept Master Card and Visa.

Retainer Information:
•Return Preparation — a retainer is due at the time we accept your tax return(s). It will equal 75% of the fee estimate (described above). The remaining 25% must be paid upon completion of the return(s) and prior to submission to the filing. **
•IRS- or State-related Services — a retainer of $1,250 (8 hours) will be collected at the time we accept your work. It will cover initial services such as information-gathering, research, conference calls and documentation required prior to meeting with the IRS. Time reconciliations and payments (if any) will be established at the end of this period.
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*If your records are on paper or otherwise unusable, there will be an added hourly fee for our staff to handle data input.
**Returns are electronically provided and filed. A small charge is incurred for paper printout.