Personal Representation to Ensure Justice: Lynn Linne, Masha Yevzelman and Ben Tozer

LYNN LINNÉ

MASHA YEVZELMAN

BEN TOZER

Just as it is difficult to make your case to the IRS, it is also difficult to be caught in a dispute with the state’s Department of Revenue without an advocate. Lynn Linné worked with Masha Yevzelman and Ben Tozer on behalf of two organizations to ensure that both a for-profit business and a nonprofit organization were not unjustly penalized by mistakes by the Department.

In the first case, Lynn and Masha assisted a minority-owned catering company that prepares meals for a senior association. After an audit of the company’s records, the Minnesota Department of Revenue assessed the catering company $34,000 in sales and use tax on prepared foods it sold to residents of the senior living facility. However, the association is tax exempt and does not charge a sales tax on the meals sold to the senior residents. This also means the catering company should not charge any sales tax on the meals that it prepared and served to the association. Lynn and Masha assisted the company in appealing the Department’s Order. As a result of the appeal, the Minnesota Department of Revenue agreed to reduce the company’s tax liability by over 70 percent. The client was very happy and relieved with the reduction, without which they may have had to cease operations.

Lynn and Ben represented a minority-owned Ethiopian restaurant after the Minnesota Department of Revenue issued an Order assessing it approximately $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.