Tuesday, January 21, 2014

IRS Embraces New Web-Ready Tax-Filing Process

Capital Press

By Dallas Lawyer Joe Garza

All the time, tax laws change, get more complicated, and oscillate in order to assist (and disappoint) different taxpayers. In 2014, you will likely to see many new additions to federal income tax, including inflation adjustments to dozens of tax items, new regulations for same-sex partners, and even drawbacks for {not buying health insurance through either the government or with a private insurer. One defining part of the '14 legislationtax season will be its several-week postponement, something that can be attributed to the infamous government shutdown last year. Still, 2014 will also initiate the beginning of a totally new kind of tax change — not only in terms of how we ultimately pay, but also how we file.

The 'Improved' Federal IRS Tax Guide

A few weeks ago, the IRS issued a “newly revised comprehensive tax guide,” or, as some call it, Publication 17: a resource that will help Americans file their taxes better during the new year. Publication 17 touts its interactive features and in-depth review of “tax-saving opportunities.” Among the additions made to the IRS guide is educational material on the American Opportunity Tax Credit, affecting enrolled college kids and their guardians, as well as Earned Income Tax Credit and Child Tax Credit.

Distributed by the Internal Revenue Service since the 1940’s, the new tax guide still features material on reporting earnings, capital gains and losses, IRA’s and basic educational material. But, at a whopping 292 pages, it seems unlikely that the average tax-payer will have time to read through Publication 17. Also, considering the increasing complexity of Federal income tax, it is no surprise that the IRS would reveal updates to the instructions almost daily.

Fewer In-Person Help Resources

Publication 17 proves a major shift from in-person interaction, with a larger amount of digital tools created to help people get through tax season.

Tighter IRS budgets — as a result of sequestration 2013 — mean that there are far fewer resources for in-person tax submission assistance. Rather than having a human representative, taxpayers will be referred to a multitude of online referential materials, including nearly 13,000 official partnering (volunteer) sites, and resources on IRS.gov - like the IRS 'Free File' program. Even basic help requests will now be answered with online resources or via various hotlines. With such a big emphasis on online assimilation, it's reasonable that a branch of the government would start offering more of its info on the web.

A Larger Emphasis on Web Content

While the lack of walk-in assistance will undoubtedly be frustrating for many taxpayers, many others will be glad to know they can take care of more tax-related problems online than ever. Tax payers can now view and complete their tax forms on the web. Additionally, the IRS will also continue to give Employee Identification Numbers through IRS.gov. Finally, to avoid fielding inquiries about the status of income tax refunds over the telephone, the IRS now handles all related questions on IRS.gov .

Thursday, January 2, 2014

Joe B Garza Remarks on Halliburton Supreme Court Case

Oil company Halliburton Co has requested that the Supreme Court review a seminal case, Erica P. John Fund v. Halliburton - To clarify, Erica P. John Fund is among the oil company's shareholders. EPJ's years-old litigation with the oil company is based on the accusation that the company misrepresented important info concerning Halliburton's shareholder operations, for instance, exaggerating income and reducing perceived liabilities. Because of this, the Fund is attempting to have its legal action against Halliburton in the form of a class action - a lawsuit that is enacted on behalf of a group suffering from similar injuries. A class action lawsuit would allow Erica P. John Fund to litigate on behalf of all shareholders of Halliburton stock, therefore increasing the capital on the table in the litigation.

NY Times just released an astute analysis of the question the Supreme Court will be faced with in the case, if it agrees to hear the case. The New York Times article explains how many lawsuits like the Halliburton case rely on the idea of “reliance”, meaning that the shareholders acted in reliance of the allegedly criminal operations of the company. Historically, the Court has a broad interpretations of "reliance". To prove reliance, an involved shareholder doesn't need to read a prospectus and the fraudulent statements it contains. Rather, courts consider any allegedly criminal statement(s) made by a corporation that is also publicly acknowledged that affects its financial value and is incorporated into the total price of the its securities. The court justifies this view on the basis that markets always price securities through the use of all information that is currently available, an idea that is largely encouraged in the field of finance. Nevertheless, although most shareholders do not critically analyze financial statements and prospectuses released by the companies in which they invest; they can still demonstrate “reliance” provided that they have purchased securities with the business. As more and more shareholders are able to prove their reliance, these types of suits become easier.

In defense's official request to review the case, Halliburton hinted that it will proceed to contest that the court is defining reliance too loosely. Halliburton co. will insist that the Court should define reliance as requiring shareholders to do more than just purchase securities; for instance, requiring plaintiffs in the CAL to review a financial statement/fraud. prospectus. This kind of an argument could definitely get strong backing from the greater business community.

As the Times piece indicates, '12 in an unrelated case, four members of the Court stated that they would be willing to overrule the conventional, nebulous interpretation of “reliance.” If the Halliburton case ultimately makes it to the court, the main question will be about whether they can find a decisive fifth vote on the Court.

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