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By Stacie Kitts CPA
These days I rarely have time to do anything that doesn’t directly involve running my accounting firm. But Kelly – also known as the TaxGirl ® penned an article that caught my eye Strip Club Doesn’t Meet “Bare Minimum” in Court. Punny huh?!
In fact, it so entertained me that I had to change gears to tell you about it. I admit it, even I think tax is a dry subject for a blog. But there is that rare story that entertains.
The fundamental question posed in Kelly’s post – Is exotic dancing an art form?
It turns out that in the state of New York, since 1965, sales taxes are imposed on the fees paid by patrons at strip clubs. However, Nite Moves, an adult club in Latham, New York, begs to differ with the state’s interpretation of adult and exotic dances. The club was audited in 2005 by the New York Division of Taxation and told to remit nearly $125,000 in unpaid sales tax – plus interest – for fees paid for door charges and private dances (if you have Tina Turner’s “Private Dancer” song in your head now, you’re not the only one). But Nite Moves claims that the assessment was in error. They believe that the fees paid should be exempt from sales tax and appealed.
In its argument, Nite Moves cited Tax Law § 1105 (f)(1) which exempts:
Any admission charge … except charges for admission to race tracks, boxing, sparring or wrestling matches or exhibitions which charges are taxed under any other law of this state, or dramatic or musical arts performances, or live circus performances, or motion picture theaters, and except charges to a patron for admission to, or use of, facilities for sporting activities in which such patron is to be a participant, such as bowling alleys and swimming pools.
In other words, they believe that fees for lap dances should be exempt just as fees for the ballet.
The court ultimately disagreed. They concluded that the club didn’t provide enough evidence that would prove that the “private dances offered in the club were choreographed performances.” The club simply didn’t successfully sell the court on their argument that stripping is an art form.
I don’t know, swinging around on a pole – upside down secured by a single limb – plus, some of those girls are really bendy and have some pretty impressive acrobatic skills. (What? I’ve seen Striptease – you know with Demi Moore) Seems to me that there is some skill involved, some artistic expression…and shall I say it, even some talent. I think, yes, I think I might have been able to sell that in court….but that’s just me.
- Exotic dance, artistic performance: tomato, tomahto, taxes (dontmesswithtaxes.typepad.com)
- NY court says strip club’s lap dances are taxable (boston.com)
- NY court says strip club’s lap dances are taxable (msnbc.msn.com)
- NY court says strip club’s lap dances are taxable (msnbc.msn.com)
- NY court says strip club’s lap dances are taxable (hosted.ap.org)
- Lap dancers take it on chin from N.Y. court (cbsnews.com)
By Stacie Kitts, CPA
I like to think of myself as a recovering recovered bubblehead. You might know the type, she was portrayed by Calista Flockhart in the late 90’s as Ally McBeal. The character was described as “annoying and demeaning to women (specially professional women) because of her perceived flightiness, lack of [knowledge], short skirts“, and….. well you get the point.
As ridiculous as it sounds, there was a time – a long time ago in a galaxy far far away – when I thought I had found the right combo. Often sporting an outfit that only Ally McBeal (an imaginary made up TV person, so like no real person should have tried to pull this off) would wear, I was, sadly, the “sexy” CPA.
Ludicrous, I know!
This style choice did not endear me to my female colleagues. And had you met me in those days, you might not have noticed that I had a brain at all. This, of course, is not the impression you want to make when your brain is what you are selling.
Flash forward ……. now we are visiting my solo “stay home” tax practice period. This quarter decade represented my relaxed period, where comfort was my style of choice. My old warn out sweats and stylish jammie sets worn around the home office probably earned me the label of “comfy” accountant. Also, NOT the serious accountant image you want to project, particularly when you are trying to convince a person who has amassed a considerable amount of wealth that you are the advisor who is going to help them keep it.
Interestingly, of these two periods, the comfy accountant was/is the hardest to overcome – a few enlightening moments, and some mentored wisdom eradicated the “sexy” CPA fairly quickly. But taking the comfy out of accounting was like a slow excruciating death.
Even so, it’s done. These days I work in an office building and I look forward to casual Fridays where I can throw on some jeans with my conservative cardigan. I might even spice it up with some colorful shoes or fun jewelry. But for the most part, first impressions are my main concern and my style choices scream I’m confident, educated, serious and professional.
Your fashion choices actually play a large part in selling you and my own fashion history is testament to this.
Being a recovered fashion bubble head probably explains why I recently had a slight meltdown when my assistant commented on how cute my suit was but added, “Your top makes you look like a big orange pumpkin.”
Let me explain.
That morning I had arrived at work wearing a conservative black suit over a cute orange top with cute orange shoes carrying my cute salmon colored purse. Just the right >pop< of color. I felt completely prepared for my big pitch to a large potential client. I was clear on the tax issues and confident in my ability to sell it. But that was before I realized that my clothing choice looked like a Halloween inspired disaster.
I hurried to the bathroom where I stood in front of the full-length mirror and thought, Oh-My-God, she’s right. Why did I pick orange and black? I look ridiculous.
Now my confidence is waning. I can’t get the pumpkin image out of my head. How was I going to sell ME and MY skills when I looked like “that” lady. You know, the one that can’t possibly own a mirror because if she did she wouldn’t be wearing that!!!!!!
My head starts to fill with possible solutions: go home and change – nope not enough time, swap blouses with a co-worker, nope not an option, run to the mall – yes there might be enough time for that there’s one right across the street. I gathered all the paraphernalia I needed for the meeting, business cards, portfolio, flyer about the company etc. and head out.
I found parking rather quickly and felt the relief flooding through my system. I ran toward the door and pull on the handle. Locked!!! It’s locked. I look at the hours – “OPEN 10am”
10AM, what? …..Shut down by my lack of knowledge about mall hours.
I pulled out my cell phone and click a button so I could see the time. 9:30 – No time to wait until it opens, find an appropriate blouse and still get to the meeting on time.
I’m screwed, I’m screwed, I’m screwed.
Despondent, I slowly slink back to my car and try to convince myself that, it’s no big deal, you can still sell it, it’s not that bad, forget it. Ya right, I was a wreck. So as I headed toward certain rejection, I resolved myself to make my pitch just the same.
But miracle of miracles, not only did I arrive early to the meeting, but by some grace of god, the meeting was across the street from a mall. A mall that was open!
It wasn’t too late, I might pull it off. I am elated, rather giddy in fact. I top the escalator and see just the perfect thing. How wonderful. I try it on and it looks great. Stepping out of the dressing room, I spot a manned sales register.
Hello, I’m in a hurry can you ring this up for me really fast?
I am sorry dear, but we just opened and it will take some time to get the registers up.
HUH, really, what? There’s noo time? NooooTime!
At this point, I’m thinking run, run with the cute blouse, go ahead make a dash for it…..it’s your only hope….It was amazing the amount of thoughts that flowed through my mind in those few seconds. Could I get away with it, I would come back later and pay, maybe she would hold onto my wedding ring for collateral.
She must have read the desperation in my expression because she says, “Wait, I think the register over here is up. Let’s see.” And glorious day, it was.
Sporting my new blouse with renewed confidence and relieved that I wasn’t a fugitive from justice, I arrived in time, made my pitch and yes, landed the client.
Hurray, disaster averted- thanks to the right first impression and my cute new blouse!
Are you looking for some information that will explain all the available IRS guidance sent out into the cosmos?
The following is a list of explanations/definitions should you be interested, need some reading material, or want something to put you to sleep at night.
For anyone not familiar with the inner workings of tax administration, the array of IRS guidance may seem, well, a little puzzling at first glance. To take a little of the mystery away, here’s a brief look at seven of the most common forms of guidance.
In its role in administering the tax laws enacted by the Congress, the IRS must take the specifics of these laws and translate them into detailed regulations, rules and procedures. The Office of Chief Counsel fills this crucial role by producing several different kinds of documents and publications that provide guidance to taxpayers, firms and charitable groups.
A regulation is issued by the Internal Revenue Service and Treasury Department to provide guidance for new legislation or to address issues that arise with respect to existing Internal Revenue Code sections. Regulations interpret and give directions on complying with the law. Regulations are published in the Federal Register. Generally, regulations are first published in proposed form in a Notice of Proposed Rulemaking (NPRM). After public input is fully considered through written comments and even a public hearing, a final regulation or a temporary regulation is published as a Treasury Decision (TD), again, in the Federal Register.
A revenue ruling is an official interpretation by the IRS of the Internal Revenue Code, related statutes, tax treaties and regulations. It is the conclusion of the IRS on how the law is applied to a specific set of facts. Revenue rulings are published in the Internal Revenue Bulletin for the information of and guidance to taxpayers, IRS personnel and tax professionals. For example, a revenue ruling may hold that taxpayers can deduct certain automobile expenses.
A revenue procedure is an official statement of a procedure that affects the rights or duties of taxpayers or other members of the public under the Internal Revenue Code, related statutes, tax treaties and regulations and that should be a matter of public knowledge. It is also published in the Internal Revenue Bulletin. While a revenue ruling generally states an IRS position, a revenue procedure provides return filing or other instructions concerning an IRS position. For example, a revenue procedure might specify how those entitled to deduct certain automobile expenses should compute them by applying a certain mileage rate in lieu of calculating actual operating expenses.
Private Letter Ruling
A private letter ruling, or PLR, is a written statement issued to a taxpayer that interprets and applies tax laws to the taxpayer’s specific set of facts. A PLR is issued to establish with certainty the federal tax consequences of a particular transaction before the transaction is consummated or before the taxpayer’s return is filed. A PLR is issued in response to a written request submitted by a taxpayer and is binding on the IRS if the taxpayer fully and accurately described the proposed transaction in the request and carries out the transaction as described. A PLR may not be relied on as precedent by other taxpayers or IRS personnel. PLRs are generally made public after all information has been removed that could identify the taxpayer to whom it was issued.
Technical Advice Memorandum
A technical advice memorandum, or TAM, is guidance furnished by the Office of Chief Counsel upon the request of an IRS director or an area director, appeals, in response to technical or procedural questions that develop during a proceeding. A request for a TAM generally stems from an examination of a taxpayer’s return, a consideration of a taxpayer’s claim for a refund or credit, or any other matter involving a specific taxpayer under the jurisdiction of the territory manager or the area director, appeals. Technical Advice Memoranda are issued only on closed transactions and provide the interpretation of proper application of tax laws, tax treaties, regulations, revenue rulings or other precedents. The advice rendered represents a final determination of the position of the IRS, but only with respect to the specific issue in the specific case in which the advice is issued. Technical Advice Memoranda are generally made public after all information has been removed that could identify the taxpayer whose circumstances triggered a specific memorandum.
A notice is a public pronouncement that may contain guidance that involves substantive interpretations of the Internal Revenue Code or other provisions of the law. For example, notices can be used to relate what regulations will say in situations where the regulations may not be published in the immediate future.
An announcement is a public pronouncement that has only immediate or short-term value. For example, announcements can be used to summarize the law or regulations without making any substantive interpretation; to state what regulations will say when they are certain to be published in the immediate future; or to notify taxpayers of the existence of an approaching deadline.
- IRS Patrol:IRS Seeks New Issues for the Industry Issue Resolution Program (staciesmoretaxtips.wordpress.com)
- IRS Patrol: IRS Issues Guidance Explaining 2011 Changes to Flexible Spending Arrangements (staciesmoretaxtips.wordpress.com)
- IRS Patrol: IRS Announces Pension Plan Limitations for 2011 (staciesmoretaxtips.wordpress.com)
- 2011 Standard Mileage Rates (staciesmoretaxtips.wordpress.com)
- Tax delinquents include IRS contractors, federal employees (dontmesswithtaxes.typepad.com)
By Stacie Clifford Kitts, CPA
Seems like I am always reading someones top something… tax/accounting/business list and it always makes me wonder – just how does someone get on this list anyway?????
Like for example take Accounting Today/Tomorrow/WebCPA. This group publishes a top 100 most influential people in the accounting industry list. Every year I read it over and wonder – how do they decide who is “most influential” anyway? I mean really, is this a scientific thing? Are there compliance criteria – like a PPC guide “How to Determine the Most Influential People in Accounting” – we are talking about accountants here – I assume there’s a checklist?
I do hope its more scientific than just a bunch of journalists sitting around a conference table, sipping coffee and munching on donuts while someone writes names on a white board. Just picture it, a bunch of bored staff writers some twisting slightly in their chairs, some lounging about, others lazily calling out names. Then someone says, “hey cross off Sally Johnson, she was rude to me at blah blah conference. she doesn’t make it this year.” Yowser,I hope it doesn’t work like that!!!
Recently, I’ve been contacted by a “.com site” or two. These sites were letting me know that I could be listed on a top something list….so –be sure to mention it at Stacie’s More Tax Tips- wont you?
While I get how this whole quid pro quo thingy works, I have declined 100% of the “link to us, we’ll link to you” offers. I’ve even turned down click for payment offers because I didn’t think the link topics where appropriate for my my site.
But you know what, I’ve decided that gosh darn my blog is interesting.. And yes siree, I deserve to be on a top anything list.. And, it has absolutely nothing to do with quid pro quo. Nope, they of course see the genius that is my blog and feel compelled to share. So thanks to bschool.com for naming Stacie’s More Tax Tips in the 50 best Blogs to Get You Through Tax Season.
Oh by the way, the picture is of me and the grandbaby enjoying Christmas day with the family!
- Ping Your Way To a Successful Social Marketing Strategy – It’s A Whole Lot Better Than Being an A-Hole (staciesmoretaxtips.wordpress.com)
- 2010 in Review – The Health of Stacie’s More Tax Tips – I Feel Like Doing The Snoopy Dance! (staciesmoretaxtips.wordpress.com)
- Snubbed Again! And a Sincere Apology (staciesmoretaxtips.wordpress.com)
- Are You All a Twitter About Tax News? Now You Can Follow The IRS @IRSnews (staciesmoretaxtips.wordpress.com)
- IRS Presents:Ten Things Tax-Exempt Organizations Need to Know About the Oct. 15 Due Date (This is a how to on keeping your exempt status) (staciesmoretaxtips.wordpress.com)
- Accounting blogs for the kids (dontmesswithtaxes.typepad.com)
- Picking Apart the IRS’ Top 10 Tax Time Tips (staciesmoretaxtips.wordpress.com)
All though the IRS tax tip series is generally good, some tips are better than others. The following tip is one of the better ones.
Taxpayers with disabilities and parents of children with disabilities may qualify for a number of IRS tax credits and benefits. Listed below are seven tax credits and other benefits which are available if you or someone else listed on your federal tax return is disabled.
1. Standard Deduction Taxpayers who are legally blind may be entitled to a higher standard deduction on their tax return.
2. Gross Income Certain disability-related payments, Veterans Administration disability benefits, and Supplemental Security Income are excluded from gross income.
3. Impairment-Related Work Expenses Employees who have a physical or mental disability limiting their employment may be able to claim business expenses in connection with their workplace. The expenses must be necessary for the taxpayer to work.
4. Credit for the Elderly or Disabled This credit is generally available to certain taxpayers who are 65 and older as well as to certain disabled taxpayers who are younger than 65 and are retired on permanent and total disability.
5. Medical Expenses If you itemize your deductions using Form 1040, Schedule A, you may be able to deduct medical expenses.See IRS Publication 502, Medical and Dental Expenses.
6. Earned Income Tax Credit EITC is available to disabled taxpayers as well as to the parents of a child with a disability.If you retired on disability, taxable benefits you receive under your employer’s disability retirement plan are considered earned income until you reach minimum retirement age. The EITC is a tax credit that not only reduces a taxpayer’s tax liability but may also result in a refund. Many working individuals with a disability who have no qualifying children, but are older than 25 and younger than 65 do — in fact — qualify for EITC. Additionally, if the taxpayer’s child is disabled, the age limitation for the EITC is waived. The EITC has no effect on certain public benefits. Any refund you receive because of the EITC will not be considered income when determining whether you are eligible for benefit programs such as Supplemental Security Income and Medicaid.
7. Child or Dependent Care Credit Taxpayers who pay someone to care for their dependent or spouse so they can work or look for work may be entitled to claim this credit.There is no age limit if the taxpayer’s spouse or dependent is unable to care for themselves.
For more information on tax credits and benefits available to disabled taxpayers, see Publication 3966, Living and Working with Disabilities or Publication 907, Tax Highlights for Persons with Disabilities, available on the IRS website at http://www.irs.gov or by calling 800-TAX-FORM (800-829-3676).
- Publication 3966, Living and Working with Disabilities
- Publication 907, Tax Highlights for Persons with Disabilities
- Happy Valentines! A Gift of Tax Filing For Your Sweetheart (staciesmoretaxtips.wordpress.com)
- IRS Announces Earned Income Tax Credit Assistance (walletpop.com)
- YourNews: Volunteer Income Tax Assistance to observe tax credit awareness day (knoxnews.com)
- IRS opens doors Saturday to help EITC taxpayers (oregonlive.com)
By Stacie Clifford Kitts, CPA
Feb. 14 is the magic filing date.
Well, I guess the IRS finally figured it out and reprogrammed their computer system to accommodate the new tax changes.. If you file Schedule A that is you itemize, or you will take the hirer education tuition and fees deduction on Form 8917, or even the educator expenses deduction, you will be able to file your tax return (hopefully) starting on Valentines Day. How romantic, a gift of tax filing for your sweetheart.
Read on for more info:
WASHINGTON — The Internal Revenue Service plans a Feb. 14 start date for processing tax returns delayed by last month’s tax law changes. The IRS reminded taxpayers affected by the delay they can begin preparing their tax returns immediately because many software providers are ready now to accept these returns.
Beginning Feb. 14, the IRS will start processing both paper and e-filed returns claiming itemized deductions on Schedule A, the higher education tuition and fees deduction on Form 8917 and the educator expenses deduction. Based on filings last year, about nine million tax returns claimed any of these deductions on returns received by the IRS before Feb. 14.
People using e-file for these delayed forms can get a head start because many major software providers have announced they will accept these impacted returns immediately. The software providers will hold onto the returns and then electronically submit them after the IRS systems open on Feb. 14 for the delayed forms.
Taxpayers using commercial software can check with their providers for specific instructions. Those who use a paid tax preparer should check with their preparer, who also may be holding returns until the updates are complete.
Most other returns, including those claiming the Earned Income Tax Credit (EITC), education tax credits, child tax credit and other popular tax breaks, can be filed as normal, immediately.
The IRS needed the extra time to update its systems to accommodate the tax law changes without disrupting other operations tied to the filing season. The delay followed the Dec. 17 enactment of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which extended a number of expiring provisions including the state and local sales tax deduction, higher education tuition and fees deduction and educator expenses deduction.
- Filing Valentine from the IRS (dontmesswithtaxes.typepad.com)
- Taxpayers who itemize can start filing returns on Feb. 14 (usatoday.com)
- Some Tax Payers Will Need to File Their 1040 Later Rather Than Sooner This Coming Filing Season (staciesmoretaxtips.wordpress.com)
- Valentine’s Day marks start of tax season for many (sfgate.com)
- When can you file your 2010 tax return? (mnn.com)
HERE’S A LESSON IN QUESTIONABLE CUSTOMER SERVICE – DON’T MESS WITH SOMEONE WHO HAS A BLOG THAT PEOPLE ACTUALLY READ
By Stacie Clifford Kitts CPA
I just can’t help myself. I need to tell you because you are not going to believe what I am doing right now.
If you are familiar with popular tax and write-up software companies, i.e. you’re a CPA or tax professional, then you might recognize the number that’s showing on my phone in this picture.
Let me break down what you are looking at.
The 800 number showing on the screen represents the “customer service” number for my tax software provider. The bottom right hand number represents the time that has passed since I have been on the phone trying to resolve an issue with the software.
Now the first hour of time that is depicted reflects the time I spent with a technician who was trying to get my custom letterhead to work properly. The idea of adding your letterhead to the software is to save time. That is, when I print a tax return, the transmittal letter and filing instructions will print on my letterhead eliminating a processing step. Yeah for everyone because the less time I spend on a return theoretically the more savings I can pass onto my clients. Very cool – if it worked!
Anyway, the tech was very nice and told me he would call me back tomorrow when he had more time to figure out why it wasn’t working.
This is when I made my fatal mistake and asked to be transferred to a different department so I could resolve yet another problem with the software. The person who took this call was unable to assist me and asked if she could put me on hold to research the issue. As of the writing of this blog, I have been on hold for over 65 additional minutes (a total of 2 hours and 5 minutes of time on the phone with you know who).
What do you think? Is my friendly customer service rep who had no idea how to answer my question heading home, or maybe she’s already home getting ready for bed spending time with her family – while I languish on hold like a spurned desperate lover hoping someone will come back to the phone and resolve my problem.
That’s right loyal readers, she forgot about me. ***Ugh*** I feel like such a loser. 😦