$240,000 in tax, fraud penalty and interest, alleging that the owner was underreporting the businesses sales tax on purchases made at the restaurant. Proving that the Department’s assessment was incorrect was extremely difficult due to language barriers as the owner of the restaurant spoke little English and did not have complete documentation. However, after an extensive review of the Department’s audit file, Lynn and Ben discovered inconsistencies in the Department’s analysis that evidenced that what the Department classified as “deleted” transactions were actually “voided” transactions and not subject to sales tax. The team was able to leverage these inconsistencies during negotiations to achieve a settlement that reduced the total liability to $110,000, a reduction of approximately 55 percent. The owner of the business was extremely grateful for reducing the assessment to a manageable result.
JENNY PUSCH
Jenny Pusch represented a 21-year-old single mother who made less than $10,000 a year. She depended on working family and childcare credits that she could claim on her state taxes in order to make ends meet. However, she received notice from the Minnesota Department of Revenue that the Department had denied her childcare credit. The Department asserted that actual receipts from the childcare providers were “inadequate” documentation of her childcare expenses. The Department’s examiner refused the credit because the client had paid for the expenses using cash instead of a credit card or check. After Jenny was unsuccessful in working with the examiner to explain the validity of cash payments and paper receipts, she contacted the Minnesota Taxpayer Advocate. The Taxpayer Advocate was equally frustrated by the examiner’s unwillingness to accept the evidence. After Jenny explained the situation and laid out the case, the Advocate was able to help reverse the denial and provide the client with her much needed and rightful credit. 23
