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Rules for Taxation of Life Insurance

Below are some quick and dirty rules for taxation of life insurance. Proceeds from a life insurance policy are excludable from gross income. Interest earned on life insurance proceeds is not excludable from gross income. If the TP receives both proceeds and interest, prorate each payment evenly, reporting only the portion of the payment that is interest. If […]

Penny Wise And Pound Foolish

Philip Wrigley had a problem. As the notoriously parsimonious owner of the Chicago Cubs in the 1970s, Mr. Wrigley did not want to spend big money to attract top players. But, as the savvy owner of a successful confectionary business, he also knew that no one would buy tickets to see a perennially second-division ballclub. […]

Antonin Scalia’s Legacy On And Off The Bench

If any lawyers you happen to see this coming week look a bit more depressed than usual, it may be due, at least in part, to the unexpected passing of Supreme Court Associate Justice Antonin Scalia. His sudden death was especially jarring for all of us who have ever experienced the completely unanticipated loss of […]

New Jersey Tax Court Procedure for State Tax Cases

Like it or not, taxes are the lifeblood of a nation. It helps fuel our government in order for it to function properly and efficiently. While paying taxes is one of our duties as citizens, there are always instances when the IRS or a State taxing authority overreaches. This may come in the form of […]

Sample Reasonable Cause Letter for Abatement of Form 941 Penalties & Interest

Attached is a sample reasonable cause letter in support of a client’s request that all penalties and interest arising out of his unintentional failure to file and pay Form 941 withholding taxes be waived. This is a heavily redacted version and should not be relied upon in any way, shape, or form in dealing with […]

Double Trouble! Employment Taxes & The Trust Fund Recovery Penalty

“Lord, hou schulde God approve that you robbe Petur and gif is robbere to Poule in ye name of Crist?” John Wycliffe, Selected English Works, c. 1380 In medieval England, the Christian Peter and Paul were two peas in a pod. They were both apostles and both martyred in Rome. They even shared the same […]

You Came Up Short

Governments will try to get away with almost anything during wartime. In the Civil War, President Abraham Lincoln suspended the writ of habeas corpus so federal authorities could lock up suspected Confederate sympathizers and throw away the keys. This action was more than mere ink on paper; it was very vigorously enforced, especially in Maryland […]

I’m Sorry

In 1811, President James Madison started the Federal Conscience Fund, which allows guilt-ridden Americans to surreptitiously atone for their financial sins. Over the years, generous benefactors have achieved various levels of catharsis. Typical donors range from guilty individuals, such as a Massachusetts woman who mailed in nine cents, because she re-used three postage stamps, to […]