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Questions Answered by D. Mathew Blackburn
1 Answer | Asked in Tax Law for Colorado on
Q: State tax obligation for K-1 form 1041

We have to amend our 2018 taxes because we received a schedule K1 form 1041 after we had already filed our tax returns and received our refund. ( my husband’s mother passed away and she had a trust out of New York) The question I have is since we are Colorado residents do we have to pay Colorado... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 29, 2020

A distribution from a trust is not an inheritance. The K-1 should only include your allocable trust income, not a distribution of trust corpus. The amounts originally placed in trust are not taxable on distribution; only the income of the trust distributed to you is taxable to you. Most accountants... Read more »

2 Answers | Asked in Tax Law for Texas on
Q: We had Obamacare in 2018 & we didn't qualify. Now the IRS wants us to pay the diff. Can a tax lawyer help lower the amt?

We qualified in 2017 for Obamacare and just kept paying.

When we first signed up, I was told that we qualified due to the insurance at my place of employment being too high and my husband being unemployed at the time.

Even though he started a new job the next year, my insurance... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 28, 2020

I would say to setup a consult with an attorney to review the return and figure out if you actually owe. If you do they can add that amount to your current IA before it's terminated.

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1 Answer | Asked in Real Estate Law and Tax Law for Georgia on
Q: I sold a house in Georgia for a loss. What is the tax implication? Do I have to file? I am not a resident of Georgia.

The house was my primary residence until I moved out of Georgia over 10 years ago. Unfortunately, the house fell into disrepair, so I sold it for a loss of about $30,000.

What are my tax implications? Do I even need to file in Georgia (given that it's a loss)? I'm only asking about my... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 28, 2020

No income on sale due to the loss, no deduction on loss since it's personal property.

You should file a non-resident return just in case the state has a copy of the 1099-S.

If they do and you don't file they'll send you a bill for tax on the gross sales proceeds.

Kind of...
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1 Answer | Asked in Tax Law for Maryland on
Q: IS A PSE ABLE TO REPORT INCOME ON A 1099-K THAT THEY DID NOT TRANSFER TO YOU IN A PAYMENT SETTLEMENT YET?

I AM A SINGLE OWNER LLC SMALL BUSINESS FILING AS DIREGARDED ENTITIY WHO RECEIVES A 1099-K FROM AMAZON FOR RETAIL SALES TRANSACTIONS. AMAZON "A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 28, 2020

Yes. They're your funds, even though you haven't received them yet you have a right to them so they're reportable.

2 Answers | Asked in Admiralty / Maritime and Tax Law for Georgia on
Q: I’m a resident of GA but work on a cruise ship full time (8 months of the year). Do I need to pay GA taxes?

They automatically take out federal taxes but since it’s office is based in Miami, they don’t take out any income tax.

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 28, 2020

Yes, your resident state will tax all your income worldwide.

Obviously you can still take foreign exclusionary or credits as allowed, but you will need to file a GA return and calculate tax owed.

I would contact HR and find out why tax is not being taken out and sent to GA....
Read more »

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1 Answer | Asked in Tax Law for Ohio on
Q: Had shared custody of two kids. Ex gave up custody this past Oct. He doesn't have half the time, pays child support.

He wants to still claim one child on his taxes because it is in our agreement. Can he legally do that still?

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 27, 2020

Under IRS rules you have to fill out and sign a form to allow him to deduct the child. This is because the IRS defines you as the custodial parent.

However, you also have a court order that says he gets to claim the child.

So if you don't send over the form and you deduct the child...
Read more »

1 Answer | Asked in Tax Law for Texas on
Q: I am being sued by the city for back taxes. What is the best thing to do?

Last week a policeman gave me a notification from the city that I and my brother (who lives in Oak Cliff with our elderly father, who has dementia) are being sued for almost $4000 in back taxes. The main thing is that we do not have the money to pay that all at once, yet I am required to answer in... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 27, 2020

Hire a professional to represent you.

1 Answer | Asked in Estate Planning, Real Estate Law and Tax Law for Tennessee on
Q: my father quit claimed his home to me in Nov. 2019. We are trying to sell the home, due to he lives with me now. can i

quit claim it back to him? Would this avoid capital gain at sale? he has lived there for 30 years and out for 3 months

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 25, 2020

You can. As long as it was his primary residence for 2 of the last 5 years the first $250k of gain will be excluded.

You still have a gift to you then a gift back, then a sale with a lump sum of cash. So your going to need to look at gift tax returns, likely no tax owed, and potential...
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1 Answer | Asked in Estate Planning, Probate and Tax Law for Colorado on
Q: I had shares in my family farm that has been handed down for 4 generations. My brother bought my shares of the farm.

Do I have to pay taxes on the money I got from my farm inheritance?

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 24, 2020

You don't pay tax on inherited property. But it sounds as if you inherited the property then sold it which is different.

You would need to determine the basis in the shares when you received them and compare that to the sales price to determine if any gain exists.

1 Answer | Asked in Business Formation for Georgia on
Q: Is it legal to open a distillery in Georgia for whisky? And if so hat are the licences needed?
D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 23, 2020

Yes you can legally open a distillery in GA. Here's a good resource for general information http://georgiadistillers.org/

I would suggest finding an attorney in the county where you're planning to open.

1 Answer | Asked in Tax Law and Social Security for North Carolina on
Q: My company had my social security number wrong for a number of years. Do I need a lawyer to fix this?
D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 22, 2020

You are not required to hire an attorney to fix the problem but it would be a lot simpler.

1 Answer | Asked in Criminal Law, Tax Law, Business Formation and Business Law for Texas on
Q: How does a non-profit change leadership and what happens to the EIN when a new owner comes and the old leaves?

I am the founder of a Texas non-profit corporation (Corporated in the State of Texas) and also Chairman/CEO. I applied for the EIN being used under my own info (Name, SSN) on the IRS site. I’m stepping down completely from operations due to conflict of interest with the board and need help in how... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 22, 2020

Non-profits don't have owners. They a board of directors and officers. When you applied for the EIN you listed yourself as a responsible party that can be changed by filing a form 8822-B or by filing Form 990.

You can't establish a non-profit under your SSN so you may have an unqualified...
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1 Answer | Asked in Tax Law for California on
Q: Is a non-California LLC making just passive (interest) income in California liable for California income tax?

I am a Texas resident who lives in Tijuana, Mexico. I am the manager and sole member of a single-member Wyoming LLC that only makes passive (interest) income from a loan and bank account interest in the state of California. Is my LLC subject to California income tax on this income? I have not... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 22, 2020

California considers you to be “doing business” if you meet any of the following:

Engage in any transaction for the purpose of financial gain within California

Are organized or commercially domiciled in California

Your California sales, property or payroll exceed...
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1 Answer | Asked in Tax Law, Business Formation and Business Law for California on
Q: Hello, I dissolved a corporation back in September and I'm not receiving notices from the Calif. Franchise Tax Board

Hello, I dissolved a corporation back in September and I'm not receiving notices from the Calif. Franchise Tax Board that I owe in excess of $900 for back "taxes" in 2018, which I think is the $800 annual fee. Am I still responsible to pay this? or can I ignore these notices since the corporation... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 22, 2020

Generally you're not personally liable for the franchise fees.

It may be worth having a professional take a look and write a letter to the franchise board.

1 Answer | Asked in Tax Law for Arizona on
Q: Can a state (for example, California) in which I owe taxes, file a lien against real property in a different state (AZ)?

If I owe taxes on California, can the state of California file a lien in Arizona against any property that I own?

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 21, 2020

Generally no. They are limited to the real and personal property within the state.

1 Answer | Asked in Tax Law for New York on
Q: Can New York state seize my car if I owe back taxes and I've been on social security for the last 15 years

I started out on Social Security Disability because I am hearing disabled. 15 years ago.

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 20, 2020

Yes. Once a tax warrant has been filed the state can, and will, seize non-exempt property and auction it to pay your tax debt.

If you call them and setup a payment plan they'll pause collections activity.

You'll also want to check to see if you're driver's license has been...
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1 Answer | Asked in Tax Law for Oregon on
Q: Why is it no one can question the IRS on fictious liens they place on deceased persons the IRS is a blight on humanity.
D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 18, 2020

Who said you can't question the IRS. That's really bad news for my career if it's true. Which it's not. Hire a professional if you have an issue with a government agency and challenge their position. It's literally what lawyers are for.

2 Answers | Asked in Real Estate Law, Tax Law and Gov & Administrative Law for Oregon on
Q: The lien is not on the deeds it's on the owner's name that attaches to his assets who owned multiple real properties

The owner is deceased and his probate is a limited judgment the PR can't sell or transfer the titles without court approval. There are co-owners on one title that can't sell their interest due to this limited judgment on one probate co-owner. The probate refuses to dismiss the co-owners need relief... Read more »

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 18, 2020

Sounds like you should hire someone to help you with that.

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1 Answer | Asked in Tax Law for New Jersey on
Q: In may of 2015 a Federal Trustee in Newark discharged my indebtedness by way of a Chapter13 Bankruptcy which included

Monies owed to the Internal Revenue Service According to IRS I owe $5,000 for year 2012 on January 22, 2020 I will be 65 years old . They take a percentage of my partial social security. At age 65 are they still allowed to collect arrearages and what is the procedure to stop this payment

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 16, 2020

2012 taxes would not be discharged in a 2015 bankruptcy. That return would have been due 4.15.13 and the three year period for discharging income tax would not have passed until 4.15.2016. Also, the IRS is a preferred creditor in a 13.

If you want them to stop the SS levy you have to setup...
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1 Answer | Asked in Tax Law for Oklahoma on
Q: In the decree my ex gets half of my 503b. Do I half to pay a tax penalty? I'm not trying to early withdraw.

I only agreed to the 50% for him because my atty said it would be from the date I moved out, not from the day he finally signed the divorce papers (3 yrs after I filed for divorce- I left in August 2016- divorce paper signed Dec 2019).

D. Mathew Blackburn
D. Mathew Blackburn answered on Jan 15, 2020

You have to use a Qualified Domestic Relations Order (QDRO). Transfers subject to a domestic relations order are not subject to penalties but you have to do it correctly. Once the account rolls over to the other party if they then distribute money or anything else it's just like nay other... Read more »

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