Since golf is a sport (?) that some of you engage in, you’ll be interested to know that Søren Hansen, the Danish linkster, may be going to jail for tax fraud.
He’s not banging everything that moves or shilling for an accounting firm, he just hates taxes. Just like you!
Hansen owes the Danes 9.6 million kroner which is about $1.75 million. That puts him a shade below Nas tax trouble.
Denmark is claiming that Hansen is a resident but he says that he kicks it in Monaco 24/7. Apparently he summers up in the motherland so this thing is a toss-up at best. If he’s found guilty of failing to pay the taxes he could wind up paying a fine of 10 million kroner and “an unspecified prison term”.
We don’t have any idea what a Danish prison would be like although we’re sure it’s rotten.
A recent IRS study shows that S corporation return filings (Form 1120S) increased dramatically and continue to be the most prevalent type of corporation filing. For Tax Year 2006, almost 2/3rds of all corporations filed a Form 1120S. The total number of returns filed by S corporations for Tax Year 2006 increased to nearly 3.9 million, from nearly 3.2 million reported in Tax Year 2002 and 722,444 in 1985. In 2006, there were 6.7 million S corporation shareholders. S corporations became the most common corporate entity type in 1997.
According to IRS data, about 68% of S corporation returns filed for tax years 2003 and 2004 (the years data were available) misreported at least one item. About 80% of the time, misreporting provided a tax advantage to the corporation and/or shareholder. The most frequent errors involved deducting ineligible expenses. Even though a majority of S corporations used paid preparers, 71% of those that did were noncompliant.
Reasonable compensation still an issue for S corporations – The GAO report also focused attention on the loophole that allows shareholders to reduce payroll taxes by reducing wage compensation. The IRS admitted that their efforts to enforce the adequate compensation rules for S corporation shareholders have been limited. For fiscal years 2006 through 2008, the IRS examined less than half of one percent of S corporations who filed.
Misreporting of shareholder basis is also a common problem, permitting shareholders to claim excess losses averaging $21,600 per taxpayer based on IRS audits for the period 2006 to 2008.
(Note: The above information was excerpted from Vern Hoven’s manual used in CPE Link’s Federal Tax Update: Part 4 webcast.) Webcasts are scheduled November-January. In Part 4, you’ll get an update on all corporate changes, partnership changes, and IRS audit issues.
Nicolas Cage is keeping his reputation as a tax scofflaw intact, as he currently owes the IRS $6.2 million due to a lien the Service slapped on his house in New Orleans. Last September, Cage settled with the Service for the diabolical sum of $666,000 after he improperly deducted $3.3 million in personal expenses, including must-haves like limo service and a Gulfstream.
Our advice to Cage would be to seriously consider going full frontal in his next film, Bad Lieutenant, Port of New Orleans. If not out of pure artistic principal and respect for the original version, do it for the extra scratch, man. A johnson shot has got to be worth, what, a couple mil? Nicolas Cage Hit with $6.2 Million Tax Lien [Web CPA]
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