Complex income or asset holdings can create overlapping tax obligations. Reviewing the applicable rules before filing can help identify required returns, records and planning considerations.

Blumsack & Canzano assists clients with tax questions involving income, investments, business activities and real estate, including issues that intersect with immigration or other legal matters.

Blumsack & Canzano has a broad-based tax practice that covers all aspects of federal, state, and local taxation, including partnership, corporate, real estate, and income taxation, as well as estate, gift, and generation-skipping taxation, and the formation of private foundations and other tax-exempt organizations. Our tax attorneys advise businesses and individuals with respect to all areas of tax law, monitor legislative developments, and advise clients with respect to the potential effect of pending legislation on their businesses and personal finances, and provide representation in tax controversies and litigation. 

Federal and state tax rules differ. Income taxes, other taxes, exemptions and filing requirements must be checked for the relevant tax year and jurisdiction; the absence of a general state income tax does not mean that no state taxes apply.

If you fail to file your tax return on time, you may face fines and interest. The Internal Revenue Service (IRS) encourages taxpayers to prepare as soon as possible, check their withholdings, collect their tax returns and tax documents such as W-2s, and confirm contact information with employers and banks.

Who needs to declare income tax?

1. U.S. citizens

A noncitizen may be a U.S. tax resident under the green card test or the substantial presence test. The latter generally requires at least 31 days in the current year and a weighted total of at least 183 days, counting all current-year days, one-third of the preceding year’s days, and one-sixth of the days in the second preceding year. Excluded days, treaty provisions and other exceptions may change the result. E or H status alone does not determine tax residency.

3. Those who are not residents of the U.S. but have a U.S. income (Nonresident Alien)

In addition to providing a wealth of experience and knowledge regarding the complicated tax aspects involved in structuring entities and complex business transactions, our tax practice encompasses a wide variety of other areas such as:

• Estate, gift, and generation skipping tax planning

• Charitable planning

• Mergers, acquisitions, and reorganizations

• Tax controversies and litigation

• Real estate transactions and real property taxation

• ERISA and employee benefits, including qualified and nonqualified retirement plans

• Bankruptcy, restructuring, and creditors’ rights

• State and local taxation, including sales & use tax and the Nevada commerce tax

Residents and nonresidents can face different rules for reporting income, deductions and foreign assets. Before preparing a return, determine the taxpayer’s status for the relevant year and review supporting records and required information returns.

Coordinating related legal issues

The contract price does not capture every financial consequence of a transaction. Income, payment and reporting questions should be considered alongside the transaction structure and allocation of responsibilities. The IRS business-startup resources help identify records requiring further review, while the appropriate treatment depends on the entity, transaction and relevant tax year.

When parties, assets or payments are located in different countries, identify where each relevant event occurred. Cross-border documentation and enforcement may need to be coordinated with foreign-income and tax-residency questions. The IRS international taxpayer resources provide a starting point for the U.S. tax issues, without establishing what another country’s law requires.

Immigration and tax questions should be evaluated separately when a person arrives, departs or changes status. Status and periods of stay are not the same issue as tax residency and filing obligations. Consult the IRS international taxpayer guidance for the tax analysis, and identify which questions require separate professional review before planning work, travel or asset transfers.

The label attached to a payment does not resolve every tax issue arising from property division, support or inheritance. Review financial provisions in family agreements alongside the relevant tax-year filings. Where an estate or gift is involved, the IRS estate and gift tax resources help identify questions about transfers, income and reporting that require separate attention.

Translate a claimed financial loss into records rather than a single unexplained total. Medical, income and other losses may need to be checked against payment and filing records. The Massachusetts Guide to Evidence helps frame proof issues. Distinguish projected expenses, amounts already paid and disputed estimates throughout the supporting materials.

Personnel issues can affect both business operations and individual rights. Pay, working-time and separation records should be considered alongside the employer’s policies and management arrangements. For federal wage questions, consult the Department of Labor’s FLSA guidance and separately review state requirements. A job title or the label chosen by the parties is not a substitute for examining the facts.

Identify the contracting entity and the authority of the person signing before evaluating a business commitment. Corporate governance and contract planning should be supported by checks of registration and authorization records. For a new venture, the IRS guidance on starting a business also helps organize tax preparation and recordkeeping without confusing the responsibilities of owners and the entity.

For a home or other estate asset, establish how it is held and who has authority to act. Estate administration may need to proceed alongside real estate transfer work. The Massachusetts probate resources help identify filings and records to examine, but assets should not be assumed to pass through a single procedure merely because they belonged to the same person.

Long-term planning for an owner should address access to records and authority after death or incapacity. Estate administration and asset authority need to be coordinated with ownership and governance documents. The Massachusetts wills and estates resources help frame the review, while beneficiary designations, jointly held property and business interests should each be examined separately.

Where estate or family assets are affected by debt, separate creditor demands, paid expenses and the asset inventory. Estate debts and distributions may require coordinated consideration of insolvency and debt procedures. The federal courts’ bankruptcy overview is a general framework, not a determination of the separate responsibilities of an estate, beneficiaries or other parties.

In a cross-border business arrangement, corporate decisions and personal immigration eligibility require separate review. Corporate structure and employment documents may support the factual record, but do not replace an employment-based eligibility assessment. Use the USCIS employment-based guidance to check whether the category fits the position, experience and business records.

Separate ownership and financing from the right to occupy a property. Real estate transaction documents may need to be reviewed together with leases, rent histories and repair records. The Massachusetts landlord and tenant resources are relevant to residential issues, while commercial arrangements require their own analysis of the governing contract and law.

When payment becomes difficult, distinguish secured obligations, unsecured debt and disputed amounts. Debt-relief and bankruptcy options need to be assessed alongside pending claims and judgments. The federal courts’ Bankruptcy Basics explains the procedural framework, but does not by itself determine whether a particular debt can be discharged or an asset retained.