More On Tax Planningfrom The Advisor's Professional Library
- Charitable Giving Charitable giving can reduce your clients’ tax liabilities. However, the general and verification rules for the deduction of charitable gifts must be understood in order to take full tax advantage of such gifts.
- Client Communication and Miscommunication RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communicationsto clients, from clients, and about client accounts. To comply with fiduciary obligations, communications must be thorough and not mislead.
Maybe Bill Romanowski took one too many hits to the head.
The former NFL linebacker, who capped his career by copping to his "hit man" reputation in a controversial “60 Minutes” interview, was on the losing end of a $4.75 million Internal Revenue Service judgment over horse-breeding expenses.
Romo (no relation to the Cowboys’ Tony), who took his apparent love of animals seriously by injecting himself with the cells of Scottish black sheep as part of his training regimen, isn’t used to losing. He played in a number of Super Bowl games over a 16-year career with the Denver Broncos, Oakland Raiders, San Francisco 49ers and the Philadelphia Eagles while inflicting the occasional illegal hit, kick or punch to the head of his opponents. He most famously punched teammate Marcus Williams (right) in 2003, breaking Williams' eye socket. Williams said the injury forced his retirement, and he was awarded $340,000 in a subsequent lawsuit.
The Wall Street Journal’s Total Return blog runs through the latest court's opinion, noting the Romanowskis invested about $13 million in programs sponsored by ClassicStar, a horse-breeding business, despite the objections of their longtime financial advisor, who worried that it was a tax-motivated scheme. Instead they relied on Rodney Atherton, an attorney with Greenberg Traurig, for tax advice concerning the investment, although he also advised the sponsors.
“The Tax Court judge, however, denied an IRS claim that the Romanowskis owed an additional $950,000 in accuracy-related penalties because they relied in good faith on Atherton’s advice,” the Journal reported. “Also yesterday, the Tax Court upheld a $2.4 million tax deficiency plus more than $480,000 in accuracy-related penalties for another couple who invested in horse-breeding programs with ClassicStar.”
It adds that the IRS has a long history of challenging deductions related to investments in horses and horse breeding.
All in a Day’s Work— Romanowski’s NFL Fines (via ESPN)
2002—Ripped helmet off of Eddie George $5,000
2001—Late hit on Roland Williams $7,500
1999—Illegal hit on Fred Taylor $15,000
1999—Illegal hit on Trent Dilfer $10,000
1999—Punched Tony Gonzalez in the head $10,000
1997—Spit on J.J Stokes $7,500
1997—Broke Kerry Collins jaw $20,000
1995—Kicked Larry Centers in the head $4,500
Check out these other stories related to Athletes at AdvisorOne: