IRS Warns of Cyber Fraud - Be Sensible and Sensitive ... Don't be Caught by Tax Phishing Scams!

By Lester B. Law

More and more, emboldened cyber scammers attempt to abscond with taxpayers' funds and information by posing as IRS representatives (or as representatives of some other legitimate agency or private company).  This illegal cyber activity is referred to as "phishing".  In a recently published report, the IRS alerts practitioners to advise their clients about recent phishing e-mails. This Client Alert summarizes the IRS' advice regarding keeping your sensitive information private, and advises about the tax implications regarding such losses.

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Durable Powers of Attorney

By Richard S. Franklin and Lester B. Law

A DPOA is a device used to authorize another person (the "Agent") to manage the financial affairs of the person granting the power of attorney (the "Principal").  Without using this tool (or other similar tools), in the event that the Principal becomes incapacitated, an expensive and invasive, court-monitored guardianship proceeding may be neeed to authorize someone to act on the Principal's behalf.

 

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D.C. Estate Tax Exemption Will Increase . . . But When?

By Michelle L. Evans

The presumably permanent federal estate tax exemption of $5,000,000, as indexed for inflation, has created an increased focus on state estate taxes.  In order to remain attractive to individuals concerned about estate tax exposure, some states have recently passed legislation to increase their estate tax exemptions.  For example, Maryland enacted a new law that gradually increases the Maryland estate tax exemption each year until it matches the federal estate tax exemption in 2019.  The District of Columbia recently enacted the Tax Revision Commission Implementation Amendment Act of 2014 (the "TRC ACT"), which became law on February 26, 2015, and makes several changes to the D.C. estate law.

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Executor Held Personally Liable for Estate's Unpaid Taxes

By Richard S. Franklin

In the recent case of United States v. Stiles, the United States District Court for the Western District of Pennsylvania found the executor for the Estate of Julia Stiles personally liable for the payment of the estate's unpaid income taxes.  This case illustrates that an executor's poor management of an estate may result in the IRS collection of the outstanding taxes from the executor's personal assets.  It's a cautionary tale and one that illustrates some of the hidden complexities associated with the settlement of a decedent's estate.

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