Beware the ‘Dirty Dozen’

IRS has become known for annually itemizing its “Dirty Dozen” tax scams expected to be seen somewhere throughout the upcoming filing season.   This year’s list is out, and “abusive tax shelters” are again prominently included.

Such “schemes,” as IRS describes them, have evolved from foreign trust arrangements into sophisticated strategies which take advantage of the financial secrecy laws of some foreign jurisdictions.

If you’re into any of these (including some trust structures put forth by unscrupulous promoters) get ready for a call from the IRS Criminal Investigation Division, and get some legal advice right away.

Will You Sell Your Home in 2015?

house w_cherry treeIf you’ve been thinking about selling your house, the magic 8-ball may give you the go-ahead in 2015. At the very least, Kiplinger’s thinks this will be a good year in which to sell. Income and employment are on the rise, naturally driving up demand for housing. (See “Kiplinger’s Economic Outlooks.”) Interest rates shouldn’t rise too much, either, making mortgage loans accessible to a wide pool of buyers.

But you’ll want to act quickly. The spring season is usually the most advantageous for selling — flowers are blooming, families with children want to move in summertime so as not to disrupt the school year, and one “For Sale” sign just seems to lead to another.

So, it’s February already. How soon can you get a home on the market? Here’s how Carol Neil, a Berkeley-based broker with over 30 years of experience, explains it within Nolo’s latest book (fresh out in its first edition!), Selling Your House:

Two months is an ideal amount of prep time once you get an agent involved. Some houses don’t need that much time, and a good agent can whip things into gear in a matter of days — but I’ve also worked with sellers for over a year to get the place ready. The houses that tend to need the most prep are the ones that the seller has lived in for the longest time. They’ve lived with the problems and don’t see them.

Of course, there’s lots you can do even before getting an agent involved, as the book also discusses. There’s no time for decluttering like the present!

Minimum Wage in 2015: Are You Entitled to a Raise?

For gavel over money istockemployees in many states, ringing in the New Year also meant seeing an increase to their paychecks. The following 21 states – and the District of Columbia – will see an increase in minimum wage in 2015: Alaska, Arizona, Arkansas, Colorado, Connecticut, Florida, Maryland, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Jersey, New York, Ohio, Oregon, Rhode Island, South Dakota, Vermont, Washington, and West Virginia. While the majority of these minimum wage bumps took effect on January 1, a handful of states have their increases scheduled for later in the year.

With the changes to minimum wage in 2015, 26 states will have minimum wages that are higher than the federal minimum wage (currently $7.25 an hour). Massachusetts and Rhode Island both saw a full dollar increase to their minimum wages, bringing the rates from $8 an hour to $9 an hour. But South Dakota saw the biggest jump of $1.25, increasing the minimum wage from $7.25 an hour to $8.50 an hour.

In general, employees are entitled to the highest of three minimum wages: federal, state, and city. Employees who live in certain, large cities will also reap the benefits of higher local minimum wages in 2015. For example, Oakland’s minimum wage will increase to $12.25 on March 2, 2015, San Francisco’s minimum wage will increase to $12.25 on May 1, 2015, and Chicago’s minimum wage will increase to $10 on July 1, 2015.

As the cost of living increases in many parts of the country, this is welcome news to employees who are struggling just to make it by.  And, employees can look forward to more good news in the next few years. Several states, and some cities, have additional minimum wage increases scheduled for 2016, 2017, and 2018.

To check your state’s minimum wage, select it from the list at Nolo’s Your Right to Minimum Wage page.

If Immigration Law Is Federal, Why Are States Passing Immigration-Related Laws?

visa_imageThink what a mess it would be if every state in the country could decide who may (or may not) receive a tourist visa, a green card, or some other immigration benefit that no one has yet dreamed up.

That’s just one of the many reasons why only the U.S. federal government may set immigration law and policy. Immigration is one of the few areas of U.S. law that is nearly uniform across the 50 states. (Exceptions exist, but let’s not get into those now.) In fact, a lawyer who becomes a member of just one state bar can move to any other U.S. state and practice immigration law there.

So what accounts for the recent news from the Washington Post that “States passed 171 immigration laws last year“?  Only Montana, Texas, Nevada, and North Dakota held back from this flurry of legislating, and apparently only because they weren’t in session at the right times.

Well, none of these states are actually handing out visas or changing existing law. (In fact, I might quibble that the headline should have replaced the words “immigration laws” with “immigration-related laws,” or “laws affecting immigrants.”)

California, for example, authorized drivers’ licenses for undocumented immigrants —  reportedly the tenth state to do so. (California also passed 53 other laws, or in many cases, “resolutions” regarding what Congress should do about immigration matters.)

Attempting to augment federal enforcement of the immigration laws was also a biggie in a number of states, as it always is. And some of these laws will eventually wind up in court and possibly be struck down, as was a 2005 Arizona law that made smuggling immigrants into a state crime. The problem there was that the court  Arizona’s action was viewed as actually conflicting with federal law.

So what’s a conflict, and what’s a complementary law? No easy answers exist. For an in-depth analysis, see “Who is Responsible for U.S. immigration policy?” by Jennifer Chacon. As Chacon concludes, “although there is a uni­form federal immigration law, and although the Supreme Court has declared unequivocally for over a cen­tury that the federal government has the exclusive power to make and enforce that law, the policies and practices of state and local governments throughout the country continue to shape the lived experience of the immigrants within their jurisdiction.”

And lawsuits over state laws, policies, and practices will no doubt be the subject of arguments and litigation into the foreseeable future.


IRS Continues to Be Worked Up Over ID Theft

IRS recently released its annual “Dirty Dozen” list of tax scams, to alert taxpayers to be on guard.  And ID theft is prominently cited.

In fiscal 2014, IRS initiated 1,063 ID theft related investigations, and Criminal Investigation enforcement efforts resulted in 748 sentencings – an increase of 75% over the prior year.

In an effort to help victims, IRS has issued approximately 1.5 million Identity Protection PINs (IP PINS).  The IP PIN is a unique, six digit number that is assigned annually to victims of identity theft with resolved cases for use when filing their federal tax return.  The IP PIN will allow these individuals to avoid delays in filing returns and receiving refunds.

Go to for IRS Fact Sheet 2015-1 and Fact Sheet 2015-2 for more info.