• Inflation-adjusted 2018 figures for various civil penalties

    Inflation-adjusted 2018 figures for various civil penalties

    Failure to file tax return. For 2018, the minimum penalty under Code Sec. 6651(a) for failure to timely file a tax return is $215 (up from $210 for 2017).

    Failure to file certain information returns, registration statements, etc. For 2018, the following penalty amounts under Code Sec. 6652 apply.

    (1) For failure to file an annual return required under Code Sec. 6033(a)(1) (for exempt organizations) or Code Sec. 6012(a)(6) (for political organizations):

    (a) for an organization under Code Sec. 6652(c)(1)(A), $20 per day (same as for 2017), subject to a $10,000 maximum (same as for 2017);

    (b) for an organization with gross receipts exceeding $1,048,500 (up from $1,028,500 for 2017): $100 per day (same as for 2017) subject to a $52,000 maximum (same as for 2017); for managers under Code Sec. 6652(c)(1)(B), $10 per day (same as for 2017) subject to a $5,000 maximum (same as for 2017); for public inspection of annual returns and reports under Code Sec. 6652(c)(1)(C), $20 per day (same as for 2017) subject to a $10,000 maximum (same as for 2017); and for public inspection of applications for exemption and notice of status under Code Sec. 6652(c)(1)(D), $20 per day (same as for 2017) with no maximum (same as for 2017).

    (2) For failure to file a return required under Code Sec. 6034 (for certain trusts) or Code Sec. 6043(b) (relating to terminations, etc., of exempt organizations):

    (a) for an organization or trust under Code Sec. 6652(c)(2)(A), $10 per day (same as for 2017) subject to a $5,000 maximum (same as for 2017);

    (b) for managers under Code Sec. 6652(c)(2)(B), $10 per day (same as for 2017) subject to a $5,000 maximum (same as for 2017);

    (c) for split-interest trusts under Code Sec. 6652(c)(2)(C)(ii), $20 per day (same as for 2017) subject to a $10,000 maximum (same as for 2017); and

    (d) for any trust with gross receipts exceeding $262,000 (up from $257,000 for 2017) under Code Sec. 6652(c)(2)(C)(ii), $100 per day (same as for 2017) subject to a $52,000 maximum (up from $51,000 for 2017).

    (3) For failure to file a disclosure required under Code Sec. 6033(a)(2):

    (a) for a tax-exempt entity under Code Sec. 6652(c)(3)(A), $100 per day (same as for 2017) subject to a $52,000 maximum (up from $51,000 for 2017); and

    (b) for failure to comply with written demand under Code Sec. 6652(c)(3)(B)(ii), $100 per day (same as for 2017) subject to a $10,000 maximum (same as for 2017).

    Other assessable penalties with respect to the preparation of tax returns for other persons For 2018, the following penalty amounts under Code Sec. 6695 apply:

    (1) For failure to furnish a copy to taxpayer under Code Sec. 6695(a), failure to sign return under Code Sec. 6695(b), failure to furnish identifying number under Code Sec. 6695(c), failure to retain a copy or list under Code Sec. 6695(d), $50 per return or claim for refund (same as for 2017) subject to a maximum penalty of $26,000 (up from $25,500 for 2017).

    (2) For failure to file correct information returns under Code Sec. 6695(e), $50 per return or item in return (same as for 2017) subject to a $26,000 maximum (up from $25,500 for 2017).

    (3) For negotiation of check under Code Sec. 6695(f), $520 per check with no limit (up from $510 for 2017).

    (4) For failure to be diligent in determining eligibility for earned income credit under Code Sec. 6695(g), $520 per return or claim for refund with no limit (up from $510 for 2017).

    Failure to file partnership return. For 2018, the dollar amount used to determine the amount of the penalty under Code Sec. 6698(b)(1) is $200 (same as for 2017).

    Failure to file S corporation return. The dollar amount used to determine the amount of the penalty under Code Sec. 6699(b)(1) is $200 (same as for 2017).

    Failure to file correct information returns. For 2018, the penalty amounts under Code Sec. 6721 are:

    (1) For persons with average annual gross receipts for the most recent three tax years of more than $5 million, for failure to file correct information returns:

    (a) under Code Sec. 6721(a)(1)’s general rule, $270 per return (up from $260 for 2017) subject to a $3,282,000 calendar year maximum (up from $3,218,500 for 2017);

    (b) if corrected on or before 30 days after the required filing date under Code Sec. 6721(b)(1), $50 per return (same as for 2017) subject to a $547,000 calendar year maximum (up from $536,000 for 2017); and

    (c) if corrected after the 30th day but on or before August 1 under Code Sec. 6721(b)(2), $100 per return (same as for 2017) subject to a $1,641,000 calendar year maximum (up from $1,609,000 for 2017).

    (2) For persons with average gross receipts for the most recent three tax years of $5 million or less, for failure to file correct information returns:

    (a) under Code Sec. 6721(d)(1)(A)’s general rule, $270 per return (up from $260 for 2017) subject to a $1,094,000 calendar year maximum (up from $1,072,000 for 2017);

    (b) if corrected on or before 30 days after the required filing date under Code Sec. 6721(d)(1)(B), $50 per return (same as for 2017) subject to a $191,000 calendar year maximum (up from $187,500 for 2017); and

    (c) if corrected after the 30th day but on or before August 1 under Code Sec. 6721(d)(1)(C), $100 per return (same as for 2017) subject to a $547,000 calendar year maximum (up from $536,000 for 2017).

    (3) For failure to file correct information returns due to intentional disregard of the filing requirement (or the correct information reporting requirement):

    (a) under Code Sec. 6721(e)(2)(A), for a return other than a return required to be filed under Code Sec. 6045(a), Code Sec. 6041A(b), Code Sec. 6050H , Code Sec. 6050I, Code Sec. 6050J, Code Sec. 6050K, Code Sec. 6050L , per-return penalty equal to the greater of $540 (up from $530 for 2017) or 10% of the aggregate amount of items required to be reported correctly with no limit;

    (b) under Code Sec. 6721(e)(2)(B), for a return to be filed under Code Sec. 6045(a), Code Sec. 6050K, or Code Sec. 6050L , per-return penalty equal to the greater of $540 (up from $530 for 2017) or 5% of the aggregate amount of items required to be reported correctly with no limit;

    (c) under Code Sec. 6721(e)(2)(C), for a return required to be filed under Code Sec. 6050I(a), per-return penalty equal to the greater of $27,350 or the amount of cash received up to $109,000 (up from $26,820 and $107,000 for 2017); and

    (d) under Code Sec. 6721(e)(2)(D), for a return required to be filed under Code Sec. 6050V, per-return penalty equal to the greater of $540 (up from $530 for 2017) or 10% of the value of the benefit of any contract with respect to which information is required to be included on the return with no limit.

    Failure to furnish correct payee statements. For 2018, the penalty amounts under Code Sec. 6722 are:

    (1) For persons with average annual gross receipts for the most recent three tax years of more than $5 million:

    (a) under Code Sec. 6722(a)(1)’s general rule, $270 penalty per return (up from $260 for 2017) subject to a $3,282,000 calendar year maximum (up from $3,218,500 for 2017);

    (b) if corrected on or before 30 days after the required filing date under Code Sec. 6722(b)(1), $50 per return (same as for 2017) subject to a $547,000 calendar year maximum (up from $536,000 for 2017); and

    (c) if corrected after the 30th day but on or before August 1 under Code Sec. 6722(b)(2), $100 per return (same as for 2017) subject to a $1,641,000 calendar year maximum (up from $1,609,000 for 2017).

    (2) For persons with average annual gross receipts for the most recent three tax years of $5 million or less:

    (a) under Code Sec. 6722(d)(1)(A)’s general rule, $270 per return (up from $260 for 2017) subject to a $1,094,000 calendar year maximum (up from $1,072,500 for 2017);

    (b) if corrected on or before 30 days after the required filing date under Code Sec. 6722(d)(1)(B), $50 per return (same as for 2017) subject to a $191,000 calendar year maximum (up from $187,500 for 2017); and

    (c) if corrected after 30th day but on or before August 1 under Code Sec. 6722(d)(1)(C), $100 per return (same as for 2017) subject to a $547,000 calendar year maximum (up from $536,000 for 2017).

    (3) Where failure is due to intentional disregard of the requirement to furnish a payee statement (or the correct reporting requirement):

    (a) under Code Sec. 6722(e)(2)(A), for a statement other than one required under Code Sec. 6045(b), Code Sec. 6041A (in respect of a return required under Code Sec. 6041A(b), Code Sec. 6050H(d), Code Sec. 6050J(3), Code Sec. 6050IK(b), or Code Sec. 6050L(c), per-return penalty equal to the greater of $540 (up from $530 for 2017) or 10% of the aggregate amount of items required to be reported correctly with no limit; and

    (b) under Code Sec. 6722(e)(2)(B), for a payee statement required under Code Sec. 6045(b), Code Sec. 6050K(b), or Code Sec. 6050L(c), per-return penalty equal to the greater of $540 (up from $530 for 2017) or 5% of the aggregate amount of items required to be reported correctly with no limit.

  • Obvious and Subtle Signs of Elder Abuse and Neglect

    If you or your loved one is in a special seeds facility (SNF), it’s important to look out for signs of abuse and neglect. Some signs are obvious, while others are very subtle.

    Unfortunately, abuse and neglect can occur when SNFs try to cut corners to save money. This results in bad outcomes for the patients. SNFs become understaffed which leads to overworked employees who are frustrated with low pay and high stress, and some employees grow indifferent to the care of their patients. Additionally, by trying to save money, some SNFs will fail to purchase safety equipment like floor mats and bed alarms. All of these things equal a recipe for patient abuse and neglect.

    There are laws in place to protect your loved ones from abuse and neglect, including the Elder Abuse and Dependent Adult Civil Protection Act (EADACPA), Title 22 of California Code of Regulations, policies, and procedures created by the SNF itself, and a patient’s bill of rights. However, proving abuse and neglect is a tough road.  You must prove by clear and convincing evidence that the facility is guilty of something more than negligence. You’ll also need to prove the facility has been guilty of recklessness, oppression, fraud or malice in the commission of the abuse, in order to receive punitive damages.

    So how is physical abuse and neglect defined? And what are the signs an SNF may be committing such acts?

    Physical Abuse

    The EADACPA defines physical abuse as assault, battery, assault with a deadly weapon, unreasonable physical constraint, sexual assault, and physical or chemical restraint for any purpose not authorized by the physician and surgeon

    The more obvious signs of physical abuse you should look for are bruising on a loved one or other patients, especially if the bruising is frequent. You should also watch out for bone fractures. Sometimes a patient will have a broken bone and the facility won’t notice due to neglect, so keep an eye out for signs of fractures.

    The more frequent type of abuse is physical or chemical restraint.

    An example of physical restraint is the SNF keeps the side rails up on the patient’s bed to prevent the patient from falling off the bed at night. Unfortunately, patients will still try and get out of bed, which means they’ll climb over the rails and possibly fall to the floor. This has resulted in injury and even death. Rather than using the rails, the SNF should put floor mats on the side of the bed. However, it’s easier and cheaper for the facility to put rails up instead of purchasing a floor mat, which unfortunately increases the risk of injury to your loved one.

    An example of chemical restraint is when a patient has dementia but is still a functioning individual. However the SNF doesn’t want to deal with the patient, so the patient is sedated to the point of becoming an individual who merely sits and drools.

    Pay attention, communicate, and don’t let an SNF take the easy way out in its treatment of your loved one.

    Neglect

    The EADACPA defines neglect as either of the following:  (1) The negligent failure of any person having the care or custody of an elder or a dependent adult to exercise that degree of care that a reasonable person in a like position would exercise, or (2) The negligent failure of an elder or dependent adult to exercise that degree of self-care that a reasonable person in a like position would exercise.

    The most common signs of neglect you should watch out for are pressures sores and bedsores

    Forms of neglect include failure to assist your loved one with personal hygiene, failure to protect your loved one from health and safety hazards, and failure to prevent malnutrition or dehydration. Another major form of neglect is the lack of supervision. When an SNF fails to supervise your loved one, the following can happen: falling, wandering and getting lost and injured, sexual assaults by other patients, fights between patients, and neglect of signs and symptoms of serious diseases. Sometimes the SNF won’t provide a patient with a shower for weeks, which can result in infections. Unfortunately, the culmination of neglect can lead to wrongful death. It’s crucial for the safety of your loved one to keep an eye out for any signs of these situations.

    As mentioned earlier, winning a lawsuit against an SNF for elder abuse or neglect is a tough battle to win. The litigation periods are long, and these cases are aggressively defended by insurance carriers and counsel. However, protection of your loved one’s rights to safe treatment at a facility is paramount and facilities shouldn’t get away with any form of abuse or neglect.

    If you believe your loved one is abused or neglected, contact an experienced attorney today.

  • Inflation-adjusted 2018 figures for transfer tax and foreign items

    Inflation-adjusted 2018 figures for transfer tax and foreign items

    Unified estate and gift tax exclusion amount. For gifts made and estates of decedents dying in 2018, the exclusion amount will be $5,600,000 (up from $5,490,000 for gifts made and estates of decedents dying in 2017).

    Generation-skipping transfer (GST) tax exemption. The exemption from GST tax will be $5,600,000 for transfers in 2018 (up from $5,490,000 for transfers in 2017).

    Gift tax annual exclusion. For gifts made in 2018, the gift tax annual exclusion will be $15,000 (up from $14,000 for gifts made in 2017).

    Special use valuation reduction limit. For estates of decedents dying in 2018, the limit on the decrease in value that can result from the use of special valuation will be $1,140,000 (up from $1,120,000 for 2017).

    Determining 2% portion for interest on deferred estate tax. In determining the part of the estate tax that is deferred on a farm or closely-held business that is subject to interest at a rate of 2% a year, for decedents dying in 2018, the tentative tax will be computed on $1,520,000 (up from $1,490,000 for 2017) plus the applicable exclusion amount.

    Increased annual exclusion for gifts to noncitizen spouses. For gifts made in 2018, the annual exclusion for gifts to noncitizen spouses will be $152,000 (up from $149,000 for 2017).

    Reporting foreign gifts. If the value of the aggregate “foreign gifts” received by a U.S. person (other than an exempt Code Sec. 501(c) organization) exceeds a threshold amount, the U.S. person must report each “foreign gift” to IRS. (Code Sec. 6039F(a)) Different reporting thresholds apply for gifts received from (a) nonresident alien individuals or foreign estates, and (b) foreign partnerships or foreign corporations. For gifts from a nonresident alien individual or foreign estate, reporting is required only if the aggregate amount of gifts from that person exceeds $100,000 during the tax year. For gifts from foreign corporations and foreign partnerships, the reporting threshold amount will be $16,111 in 2018 (up from $15,797 for 2017).

    Expatriation. For 2018, an individual with “average annual net income tax” of more than $165,000 (up from $162,000 for 2017) for the five tax years ending before the date of the loss of U.S. citizenship will be a covered expatriate. Under a mark-to-market deemed sale rule, all property of a covered expatriate is treated as sold on the day before the expatriation date for its fair market value. However, for 2018, the amount that would otherwise be includible in the gross income of any individual under these mark-to-market rules will be reduced by $713,000 (up from $699,000 for 2017).

    Foreign earned income exclusion. The foreign earned income exclusion amount will increase to $104,100 in 2018 (up from $102,100 in 2017).