Even ‘Real Housewives’ pay taxes – learn from Teresa’s windfall of mistakes
Jeffrey S. Freeman, J.D., LL.M
The IRS cares not what TV channel your family appears or if you’ve topped the New York Times Bestseller’s list multiple times. They care that you honestly file and pay your taxes. Simple, right? Reading the reports and watching the sentencing of Teresa Giudice, star of Bravo’s ‘Real Housewives of New Jersey’, and her husband Joe was a startling. The numerous misses and mistakes made by the couple was alarming. Conscious or not, they must now pay for their crimes. But, you can take a moment and learn from their mistakes.
File your taxes – Not filing your taxes is never a good option. Joe Giudice failed to file their 2004 tax return. The IRS rarely grants a free pass to those who do not file or pay and Teresa and Joe are paying in both time and money. If you owe taxes and don’t file you are going to pay a 5% monthly fee on the taxes owed, with a maximum fee of 25%. Additionally, if you wait 60 days to file you’ll be charged a $135 fine or 100% of the taxes owed, whichever is smaller. The penalties continue to grow, stay ahead of the April 15th deadline and always file your taxes.
Report all your income – Honesty is always the best policy. Reporting all your income earned and any earnings from foreign sources is equally important. Joe pleaded guilty to not filing taxes on approximately $1 million income between 2004 and 2008. The IRS has been very clear that regardless of legality, your income is still taxable. From casual poker night to scalping tickets keep documentation. However you pay your bills the IRS still wants a cut.
Disclose your assets – You might not be the starring in a reality TV series where your possessions and shopping trips are broadcasted to the world, but you still need to disclose your assets. Teresa Giudice made this mistake more than once by failing to admit numerous assets in bankruptcy court and again by failing to disclose all assets in the presentencing report. Not just small items, but several cars and three ATVs were omitted and she claimed she owned jewelry. In addition, Teresa stated that her luxurious $3 million home contains a mere $25,000 worth of furniture. Whether in court or on official tax documents you are certifying that you are stating the truth, including what you own.
Learn from Teresa’s sad situation. In September 2013 she shared her emotions with Bravo’s host Andy Cohen saying “Why? Why is this happening to me?” Taxes was just one piece of her crumbling, now you know what not to do.
About Freeman Tax Law
Freeman Tax Law (FTL) is a boutique law firm consisting of a multi-disciplinary team of tax professionals including tax attorneys, CPAs and a professional staff that have vast experience with foreign tax compliance and regulatory matters for financial institutions. FTL consults with both FFIs and USFIs with regard to Foreign Account Tax Compliance Act (FATCA) and related regulatory matters and assists them developing procedures on how to comply with these laws. FTL provides a multidisciplinary approach for filing offshore voluntary disclosures. Working to help clients prevent future tax headaches we offer a complete wealth management and estate planning team. As an experienced firm with wide reach, Freeman Tax Law provides immediate assistance to our clients planning for and resolving all tax related challenges.
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