Stuart A. Bronstein <spamtrap[at]sbcglobal.net> wrote:
- quote -

And it's perfectly legal for the taxpayer to lose the
receipt, right?

So in the underlying case (negative tax bracket), would your
advice be to include the deduction on the return, and ask
for an audit? The auditor will disallow the deduction
without proof, and lower the taxes as a result.

Seth

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sethb[at]panix.com (Seth Breidbart) wrote:
- quote -

As I recall, the advice was something like, "if you're
audited the deduction will probably be denied, but I think
it's legally justified anyway.

- quote -

The issue is proof. As far as I'm concerned if you really
made the expense you can take the deduction, even if you
lost the receipt. The problem will be to convince anyone
else you really paid.

Stu

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Stuart A. Bronstein <spamtrap[at]sbcglobal.net> wrote:
- quote -

How similar? Was the advice to leave off deductions?

Suppose the taxpayer spent the money, but lost the receipt;
now they can't prove the deduction, so they're no longer
entitled to it, right?

Seth

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Dick Adams wrote:

(snipped...)

- quote -

Thanks for the kind words, Dick. A brief answer to your
question: Circular 230 would not apply to "Go see Joe Smith
down the street;" It would apply to "he can get you a
higher refund (than I am allowed to.) There are some
practitioners in our country who may even encourage a former
client (for whatever reason!) to go see Joe. Two reasons;
get rid of a PITA client, and make your competition's life
more hellish.

I would like to throw this out however. In determining net
profit for a business (schedule c, 1065, 1120S) which is
reported as a part of GROSS INCOME on page 1, it is
necessary to consider all expenses.

However deductions on schedule a, other credits on page 2,
even the educator's 250$ "allowance" and other adjustments
are granted "by the grace of congress", and thus not
required to be taken.

ChEAr$,
Harlan Lunsford, EA n LA

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Dick Adams <rdadams[at]smart.net> wrote:

- quote -

Well, I know three lawyers who were indicted for tax fraud
in Chicago for giving advice very similar to that.

- quote -

Because now it's our problem.

Stu

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- quote -

the source of these problems have been amended and revised
over the years, so there are a lot more than 535 nitwits in
DC who created this problem.

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Without naming names (excpet Harlan's later on):
Someone wtote:
- quote -

Some have disagreed and one wrote:
- quote -

I was somewhat surprised that such a disagreement existed.
While mumbling outloud, my child bride asked me what the
problem was. I explained it from both the AMT viewpoint and
the EITC viewpoint. To wit she said "Aren't you the one who
said that the AMT is the kind of thing that has historically
created armed conflict and revolutions and that EITC was a
welfare scam written into the tax code? And now you're
complaining because 'the chickens have come home to roost'."

And I can't disagree with her for the simple reason that she
is right. Both of these abominations were bound to cause to
problems. I am compelled by common sense and professional
ethics to side with Harlan and his Circular 230 argument.
BUT does Circular 230 apply to unpaid advice such as "Go see
Joe Smith - he can get you a higher EITC payment? {sarcasm}

535 nitwits in DC created this problem. I see no reason we
should fix it for them - maybe just yell at them about it.

Dick

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