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According to the Financial and Accounting Women’s Alliance, women represent 50% of all full time staff at CPA firms, but make up just 27% of partners and principals. Even though more and more women are entering the tax and accounting professions, women in finance are still vastly underrepresented in management and leadership roles. What will it take to buck that trend?

There are many women in finance these days, but there’s still a huge gap in the amount of women in leadership roles.

In today’s episode of the Taxgirl podcast, Kelly is joined by Kathryn Kaminsky to discuss the gap of women in tax and accounting leadership. Kathryn is Vice-Chair and Trust Solutions Co-Leader at PwC. In this role, she leads the combined Tax and Assurance business. She is a partner with over 25 years of experience serving the financial services industry. Kathryn was recognized in Crain’s 2019 list of Notable Women in Accounting and Consulting. In that role, she focuses on the advancement of female and diverse professionals in the firm, and she regularly speaks at universities, conferences, and PwC functions regarding career development and women in leadership.

Listen to Kelly and Kathryn talk about women in finance in leadership roles:

  • The power of opening up to colleagues about your life and how doing so can form stronger bonds.
  • Building strong relationships in business requires empathy and compassion.
  • Many women feel like they’re unable to ask for help in their work environment.
  • The importance of providing yourself “a moment to breathe” outside of being everyone’s counselor. 
  • Balancing work and family time can look different for everyone; there shouldn’t be any judgment.
  • What advice would Kathryn give to younger women about finding a mentor in their workplace?
  • Nurturing relationships with your allies and mentors at work.
  • Kathryn’s experience taking tax and accounting classes after graduating with a History degree during undergrad.
  • The joy of truly loving the work and client relationships in tax and accounting.
  • Did Kathryn feel any pushback as a woman in leadership?
  • Whether women and POC in leadership roles feel like they have to be the “voice” of their entire demographic.
  • How are Diversity and Inclusion initiatives progressing and evolving?
  • Tax and accounting firms have traditionally been resistant to change; does that create additional hurdles for Diversity and Inclusion programming?
  • Kathryn’s hope for PwC and women in finance and accounting in the future?
  • The impact of sharing support and experiences with family.
  • Normalizing letting the next generations see that there are many paths to success.

More about Kelly:

Kelly Phillips Erb created and hosts the Taxgirl podcast, your home for tax news, tax info, and tax policy. In each episode, she shares conversations about taxes, money, and the choices we make. Kelly is a tax attorney who works with taxpayers and tax practitioners like you every day. She helps folks out of tax jams, and hopefully, keeps others from getting into them.

You can find out more about Kelly here and you can follow her on Twitter, Facebook, Instagram, and Linkedin.

To subscribe to the podcast (it’s free!) using Apple, Spotify, or your favorite listening app, click here.

Kelly’s Website: Taxgirl

Kathryn S Kaminsky: PwC

Kathryn S Kaminsky: LinkedIn

Tax + Trust: Understanding The New Expectation for Business: Kathryn S Kaminsky’s Bloomberg article (6/22/2021)

Have Empathy, Respect Boundaries and Priorities, Be an Ally: Kathryn S Kaminsky’s Bloomberg article (3/23/2021)

Everyone understands the IRS is responsible for collecting taxes but those aren’t the only IRS jobs that exist. The IRS generates approximately 96% of the funding that supports the federal government’s operations, playing a massive part in everything from Homeland Security to helping disadvantaged citizens. But what is it like to work for the IRS?

IRS jobs can be varied and rewarding.

On this episode of the Taxgirl podcast, Kelly is joined by Robin Bailey Jr., the Human Capital Officer at the IRS to discuss what it’s like working for the IRS. Kelly and Robin discuss his experience working for the IRS, where you can find a wide variety of IRS jobs, and how the IRS can be a great place to work.

Listen to Kelly and Robin talk about IRS jobs:

  • Robin’s background and joining the IRS
  • Why you should work for the IRS
  • How the IRS helps disadvantaged youth
  • How to find IRS jobs
  • IRS Forward program — What it is and the requirements
  • How many people the IRS is looking to hire
  • IRS jobs training
  • Diversity and inclusion hiring practices
  • International hiring
  • Remote working for the IRS
  • How the IRS is trying to be better connected to applicants throughout the hiring process
  • IRS ambassador program
  • Lateral moves within the IRS
  • IRS orientation process
  • What working for the IRS means

More about Kelly:

Kelly Phillips Erb created and hosts the Taxgirl podcast, your home for tax news, tax info, and tax policy. In each episode, she shares conversations about taxes, money, and the choices we make. Kelly is a tax attorney who works with taxpayers and tax practitioners like you every day. She helps folks out of tax jams, and hopefully, keeps others from getting into them.

You can find out more about Kelly here and you can follow her on Twitter, Facebook, Instagram, and Linkedin.

To subscribe to the podcast (it’s free!) using Apple, Spotify, or your favorite listening app, click here.

Kelly’s Website: Taxgirl

IRS jobs website

One of the biggest fears right now for students and recent grads is being able to find a decent job. Job opportunities drastically vary based on the economy. The projected job outlook for 2018-2028 was expected to be a relatively healthy 6%. However, now the numbers are expected to be altered even more due to COVID. Where do we stand today with employment growth and opportunities? The unknown might leave many employees and employers in fear. Kelly invites a master’s student, Ryan O’Keefe, who is currently interning in the tax and accounting field. Ryan shares an inside look at how things are currently operating during this unique time.  

How Ryan Continues to Build His Career During The Pandemic  

Ryan O’Keefe is studying for his master’s in tax and accounting and is also currently interning an eight-week contract with Rubin Brown. Ryan is living the experience of seeking new opportunity and building his career in tax and accounting, all the while the economy and career realm are unknown and constantly being altered. Tune into this week’s episode to hear what Ryan is currently experiencing, how he handles it and what his hopes and expectations are moving forward with his career.  

  • How Ryan Gravitated to Tax and Accounting  
  • Ryan’s College Experience 
  • Ryan’s Internship with Rubin Brown Las Vegas  
  • CPA Exams Affecting Hire  
  • Dealing with Anxiety of the Current Unknown Employment Opportunities  
  • Will School Uptick Due to Employment Pauses  
  • Relocating for Job Opportunities  
  • Pros and Cons of Virtual Learning and Zoom Conferences  
  • Networking and Staying Involved During Covid-19 
  • Pressure of Working During Pandemic as a New Employee 

About Kelly: 

Kelly Phillips Erb created and hosts the Taxgirl podcast, your home for tax news, tax info, and tax policy. In each episode, she shares conversations about taxes, money, and the choices we make. Kelly is a tax attorney who works with taxpayers and tax practitioners like you every day. She helps folks out of tax jams, and hopefully, keeps others from getting into them.

You can find out more about Kelly here and you can follow her on Twitter, Facebook, Instagram, and Linkedin.

To subscribe to the podcast (it’s free!) using Apple, Spotify, or your favorite listening app, click here.

Kelly’s Website: Taxgirl

Ryan’s Internship: Rubin Brown

Taxgirl Jobs Board: Job Listings

The interview was going fairly well. I was feeling confident, even in my borrowed suit, having fielded a number of questions about law school and my internship in the estates department at the Internal Revenue Service. I even passed an impromptu pop quiz about the Tax Code with flying colors, all while keeping my nerves at bay. My first “real” job in the legal world was a big deal to me and I didn’t want to blow it. I was prepared for almost anything. Until this question: “So are you planning on having any kids?”

I blinked. I stammered a little bit. And then I answered truthfully, saying that as one of three children, I always assumed that I would have kids of my own. I quickly added that I remained committed to being a lawyer, that I didn’t have a set time frame for having children, and that I knew that, when the time came, I would be able to manage the demands of the legal practice with motherhood. I felt pretty good about my answer.

But it wasn’t long before I was asked the same question again.

It turns out that while it’s inappropriate – and perhaps unwise – to ask questions about plans for having children, it’s not illegal (though making a hiring decision based on that question is illegal). And it happens. A lot more than you’d think.
You see, the decision to have a child has always been painted as a private one. But realistically, it’s always been more than that. Whether and when to have children is easily a talking point for our friends, our own parents, our neighbors – and even potential employers. We whisper about it in coffee shops and discuss it on talk shows. We gobble up celebrity parenting stories online and watch entire television shows about the likes of Kate Gosselin and Honey Boo-Boo.

But if discussions about whether to have a child were actually private, we wouldn’t have had that cover story on Time magazine touting “The Childfree Life.” Or this story in the Guardian about smart women not having kids. Or a day like last Thursday, when both CBS and NBC led their morning coverage with stories about mothering and careers.

The reality is that we like talking about it. But I’m not sure that we’re talking about it in the right way. We like sound bites and pithy anecdotes and snippets of statistics but those things tell just half a story.

Last week, I surveyed a number of women about their perceptions and thoughts on motherhood. The number of answers that I received blew me away: it was the largest response I’ve ever had for a story. Women really do want to talk about this issue. And they want to talk about it honestly. As I sorted through the hundreds of emails and messages, I started thinking about much of what’s been missing from our dialogue on motherhood. With that in mind, here are thirteen understatements, half-truths & misunderstandings – some serious and some light-hearted – that our society has about motherhood:

1. You get maternity leave. Folks talk about maternity leave as if it’s a paid vacation. Let’s just get something out of the way from the get-go: your employer may be required to grant you time off under the Family Medical Leave Act (FMLA) but it’s unpaid leave. And not all employees qualify: you only qualify if your employer is a public agency (think government employees) or a private employer with 50 or more employees. Some employers may also offer short-term disability insurance which covers pregnancy: if that’s the case, you may be able to get partial pay for approximately six weeks after you have a baby. That money will come in handy because, well, see #2.

2. Raising kids is expensive. Of course it is. But we don’t talk about how expensive. For a typical middle-income family in America, the U.S. Department of Agriculture estimates (downloads as a pdf) that it will cost nearly $300,000, adjusted for inflation, to raise a child from birth to age 17, or more nearly $20,000 per child – that doesn’t include the cost of private education or the cost of college. Housing is the single most expensive cost attributable to raising a child, accounting for 30% of the total. For kicks, I entered my information into the USDA calculator (you can give it a whirl here) to find out more based on my children’s ages, our income bracket, and our geographic area. The USDA kindly advised that taking into account all expenses including health care, food, clothing, housing and transportation, I would likely spend $54,647 on costs associated with my three children each year. I’m beginning to think they need to do more around the house.

3. Your entertainment choices are limited. I’m not going to lie to you: there’s some really bad kid TV out there. And even though you tell yourself that as an educated, grown person, you will not subject yourself to bad children’s TV, you will. There’s practically no parent out there who hasn’t both seen – and complained incessantly about – Caillou. And now, all of those same parents have that theme song stuck in their head (sorry!). It happens. But it’s not all bad: you have a good excuse to see all of the good Pixar movies in the theatre and even wear the kooky 3D glasses if you want. And yes, there’s “real” culture, too. We’ve seen the Nutcracker at the ballet and Wicked on stage – as well as the London edition of Les Miserable on DVD more than anyone should have to, really, but who could say no to Nick Jonas in 18th century French costuming?

4. You get the benefit of a tax deduction. Admit it. Those little onesies that proclaim “Mother’s Little Tax Deduction” are adorable – if slightly flawed. You see, if your child is a “qualifying child” for tax purposes (and in most traditional family situations, that would be the case), you would be entitled to claim an exemption amount for a dependent. It’s not exactly the same thing as a deduction – and you don’t have to itemize in order to claim it. It is, in simple terms, the amount that you can exclude from taxable income; the exemption is $3,900 for 2013. That sounds pretty great, right? That means that I can reduce my taxable income by $11,700 in 2013 simply for having children. But see #2. Those kids are simultaneously reducing my real income by much more.

5. You don’t sleep. You do sleep. Statistically, you actually sleep a little more in the beginning of motherhood than the average person. A 2005 Sleep in America poll found that, on average, adults in America report sleeping an average of 6.9 hours per night when considering both weekday and weekend sleep. New moms get a bit longer average sleep: 7.2 hours. But here’s the rub: it’s “highly fragmented” sleep which can be likened to the same kinds of disturbed sleep as you experience with, say, sleep apnea. Your sleep gets regularly disrupted throughout the night, meaning that there is little in the way of quality of sleep. That can make you cranky and contribute to lack of concentration – and other fatigue-related problems which could affect your daily activities, like, oh, say, your job performance. So see #6.

6. Having a child reduces your chances of getting a promotion and moving up the career ladder. In the 2009-2010 class, women made up 47.2% of J.D. students. About that same rough percentage – 45.4% of associates – were women in 2011. However, only 23% of all federal judgeships were held by women. At top law firms for women, 10% of firm chairpersons were women, 12% of the firms had women managing partners and 19% of the equity partners were women. I cite those statistics because I’m a lawyer and that’s the world that I know. I also happen to know that while some of those numbers are attributable to motherhood (you try being coherent for 80 hours a week at the office and still remember all of the words and moves to ‘Head and Shoulders, Knees and Toes’), it’s not a matter of simply connecting the dots. There are clearly other factors at play, including your run of the mill gender discrimination and the curious notion of why anyone would want to remain in the law.

Of the women I surveyed, about half of those who had children predicted that they would have been in the same place, career-wise, without children; about the same percentage of those who didn’t have children estimated that they would be in the same place if they did have children. The answer to the question, however, appeared to vary more by career choice than motherhood. Penney Mizell Brooks, who works as a Human Resource Policy Training Specialist, indicated that she “would have made different, more drastic, more risky career choices if not for being a parent.” Many chimed in similarly, saying that they might have gone back to school or tried for management positions.

Others, however, aren’t so sure that motherhood played a role in their current position, saying that their career path is exactly as they assumed it would be. Still, others believe that women may use motherhood as a crutch, with a successful freelancer telling the story of a competitor who volunteered that “she would be as successful as me if she didn’t have children, but I think that’s just an excuse.”

7. It’s easy to work outside of the home since you can put your kids in childcare. It is true that a lot of parents opt to pay for childcare. In order to accommodate work schedules for parents, nearly 11 million children under age 5 are in some type of child care setting for an average of 35 hours each week; by the numbers, that works out to just under the population of the state of Ohio. In 40 states and the District of Columbia, the cost of child care for an infant exceeds 10% of state median income for a married couple. Depending on where you live, that actual out of pocket attributable to putting your infant in childcare ranges from $4,600 to $15,000 per year. Compare those numbers to the salary for a person making minimum wage in 2013: he or she would earn just $14,500 annually, pre-tax.

To offset the cost of child care, taxpayers may qualify for the child and dependent care credit. To qualify, you must pay qualified costs for qualifying children under age 13, or for dependents of any age who live with you for more than half of the year and who physically or mentally cannot take care of themselves. The credit can be up to 35% of your qualifying expenses, depending upon your adjusted gross income (AGI): as you make more money, the credit decreases. For 2013, you may use up to $3,000 of expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit; largely, child care expenses exceed those caps. If you do the math, it means that those at the bottom struggle simply to pay for child care and those at the top are dinged for paying.

So does that mean that the cost of childcare is driving women out of the workplace? Clearly not, if you consider the number of children still in child care. That said, almost all of the moms I surveyed who did quit work after they had children cited the cost and worries over quality child care as a primary reason. That typically happened not after the first child, when child care was still manageable, but after the second or third, when the costs and in some cases, hassles, of paying for child care made it unrealistic to continue.

8. Your diet will necessarily turn into the stuff of school cafeteria nightmares. Yes, things change. But let’s be clear on this one: my life is not a rotating smorgasbord of chicken nuggets and Happy Meals. I like to cook. I like to eat out. I always have. And having kids didn’t change that. While it’s true that we now have industrial-sized boxes of Pepperidge Farm Goldfish in our home, as well as enough juice boxes to carry a small town through a nuclear disaster, we’ve made a conscious decision to introduce our kids to all kinds of food. My kids eat dim sum and sauerkraut and naan and every kind of vegetable on the planet. In fact, they’ll try almost anything: over the weekend, they even tried bone marrow at nearby Wyebrook Farms.

And while I realize the folly of dragging them into a quiet BYO (nobody wants to have a romantic dinner with my kids at the next table), that doesn’t mean that we’re relegated to terrible eateries. We go to real restaurants where I expect them to act like human beings – quite frankly, they’re often better behaved than many of the adults.

In our family, I think it’s important not to buy into the stereotype that kids are de facto picky eaters. I have a pantry filled with chutneys and chili peppers that would say different.

9. Women must sacrifice their own education in order to have children. The Guardian article that garnered so much recent press focused on research that Satoshi Kanazawa performed indicating that “maternal urges drop by 25% with every extra 15 IQ points.” Kanazawa lamented that smart women were no longer having children, a notion that he claimed was antithetical with the survival of our culture since fewer intelligent moms should mean fewer intelligent kids. If we keep that up, he posited, we’ll end up with a nation filled with dunderheads (I might have paraphrased him a bit there).

While there is some data to suggest that women with advanced degrees are less likely to have children, it’s mostly old data that’s a little bit skewed. According to a fairly recent Pew Study, a higher level of education is associated with lower rates of motherhood except for women who pursue the most advanced degrees. In other words, women with professional degrees and Ph.D.’s are actually more likely to have children than their counterparts with lesser degrees. In terms of tipping the bus, I’m firmly on the professional degree with children side.

What could cause these kinds of numbers? Claudia Goldin has suggested that certain of the fields that require the most education may also be those fields that allow a healthy work-family balance. Whatever the reasons, almost across the board, responses from the women I’ve surveyed seem to suggest that most women are still pursuing the level of education they intended whether they have children or not.

10. You have to drive a mini-van. Before we had children, we had an awesome car. It was a little bit of death trap but it was beautiful: a 1976 Fiat Spyder convertible. We still have it though it’s mostly relegated to the garage for very practical reasons: it has lap belts only, no airbags and it doesn’t have a proper back seat. Nowadays, however, car seat laws and other state and federal safety regulations mean that you have to be somewhat practical. Safety matters. No, you don’t have to buy the mini-van, even though many of my friends swear by them, but the fun little two-seater is definitely out. At least for 15 or so years.

11. Paying for your child’s education will bankrupt you in your golden years. The College Board reports that the cost of an education at an in-state public college for the 2012–2013 academic year averaged $22,261; for a private college, the average cost was $43,289. Those are big, big numbers and they cause many sleepless nights for a lot of parents. But here’s a big secret: you don’t have to lose your shirt over your kid’s education. You don’t have to spring for the most expensive school; even if you do, financial aid in the form of grants and scholarships may be available. And some folks have suggested that it might be a good idea not to pay for your child’s education in the first place: there’s nothing that says you have to. I know it sounds terrible but, to be fair, my parents didn’t pay for me to go to college. I relied on scholarships, work, and borrowing to finance my education and despite how terrible making your kids pay their own way may be painted in the press, it didn’t kill me. In fact, I’m still paying for my education now – and I consider it an investment.

But even if you do opt to pay your child’s way through college, you don’t have to break the bank. You can invest as you go through qualified tuition plans, such as 529 plans and Coverdell Education Savings Accounts. Additionally, when the time comes to write the check, there are education tax credits, including the American Opportunity Credit, and deductions, such as the above-the-line tuition and fees deduction and the student loan interest deduction, available to help offset those costs.

12. You won’t ever go anywhere interesting ever again. That picture of that couple lying on the beach on the cover of Time touting “The Childfree Life” has attracted quite a bit of attention. My vacation photos never look like that. Of course, they never really looked like that before I had kids either. But it was the case that vacations were easier before kids. I used to be the kind of girl who could be packed and ready in five minutes. Now, I can’t even get the kids with their pre-packed suitcases out of the door in five minutes. But that doesn’t mean that every vacation has to be a stop at an amusement park. While I’m not as bad as my dad – who used to drag us to the cemetery to do grave-rubbings for his genealogy project (which, to be honest, we thought was pretty awesome) – I take my kids to places that I want to go within reason. So no, they didn’t go to Vegas with me and my husband and I didn’t take them to Cooperstown for our anniversary. But I have run a 5k with my daughter on Bald Head Island and taken a pedicab through New York City’s Time Square with my son. We’ve been to state parks and small-town fairs. My kids have scrambled over rocks in Maine and gone digging for clams in the sounds of North Carolina. It’s more difficult to travel with kids. Airfare is crazy-expensive. Hotels are meant for families of four. And day passes at amusement parks for all five can run roughly the cost of our mortgage. But we’ve made it work.

Interestingly, however, when I asked mothers to name one thing they wished they had done differently, it wasn’t careers or sleep or education that most cited. The number one regret? Not traveling enough before having children.

13. Everybody else is doing it. When I was a kid, it went without saying that I was going to be a mom. And my mom before that. And her mom before that. But that’s not true anymore. The birthrate in the U.S. at an all-time low: about 80% of women become mothers now, compared with 90% just forty years ago. While it’s true, then, that statistically more women are still opting into motherhood, it’s no longer a given that being female equals having children. So even if you were inclined to keep up with the Joneses, it’s hard to know what that means any more.

I don’t think that there was ever a moment when I thought that I wasn’t going to have children. I just knew that I was going to be a mom. I will confess, however, that every now and again, I imagine that it would be amazing to have those moments of quiet thoughtfulness. A day where no one asks me for a snack or follows me to the bathroom. A day where I don’t have to break up an argument about who gets to put the lightning bug in a jar or who gets the purple crayon first. A day where I could just plop down and click on the television to watch something completely indulgent. But that isn’t the life I chose.
And that’s the bit that I think is hard to reconcile in all of this press that we’ve been seeing popping up. Having children is a choice. And not having children is a choice. And just like any important choice, you should arm yourself with the facts. But then, it’s up to you.

According to the Weather Channel, it feels like 92 degrees right now. I firmly believe that it should never feel like 92 degrees in the evening in Philadelphia.

On the plus side, after a grueling day gardening in the heat (hey, it had to be done), I now have the opportunity to sit down, check email and sift through the taxgirl mailbag. It’s surprisingly full for summer so if you’ve sent me a question, please be patient if you don’t see your answer.

And do me a favor, okay? I know summer can be busy but please take an extra couple of minutes to check on your fellow living things – those with four legs as well as two legs. Pets and kids get hot quickly inside a car, so be super careful. And wander across the street to check on your elderly neighbors this time of year. Got it? Good! Now to the mailbag!

Taxpayer asks:

I am a rising 2L in California. I am seriously considering a career as a tax attorney.

My law school does not offer an LLM in Taxation. They do, however, give students the opportunity to participate in a Low-Income Taxpayers Clinic. The business school associated with the university also has a year-long accounting program that would give me the necessary credits to take the CPA exam, if I was so inclined.

I was told my one tax attorney that doing “monkey work,” or preparing tax returns over and over under the direction of a tax attorney would be very beneficial.

What opportunities would you recommend I pursue while in law school? Would you ever recommend an online LLM in Taxation program?

Taxgirl says:

I don’t think you can overstate the value of practical experience when it comes to being a tax attorney. So if you are really interested in tax law, by all means, participate in the Low-Income Taxpayer Clinic. You’ll learn a lot not only about taxes but about how to work with clients and the IRS. Even better? You’re doing a good thing.

I also highly recommend taking advantage of other opportunities such as internships and mentorship programs.

That said, don’t stack up on taxes as a 2L if you’re not sure (and it sounds like you’re not). Why not take a couple of other classes in topics that you think you might find interesting – just to see what’s out there? If you know my story, you’ll know that I fell into tax law quite by accident when running away from litigation. I found that I loved it and stayed. My best advice is to find something that you enjoy and stick with it. If that’s tax, then by all means, sign up for everything tax-related that you can manage. But if you’re still looking, consider law school a great opportunity to try things on for size. I think you’ll find in practice that it’s very hard to switch gears; it’s rare (though admittedly, it happens) that you will change disciplines once you start practicing.

With respect to the LLM in Taxation, I don’t think you need a degree for the sake of getting a degree. If you are interested in a program that offers you a tangible benefit, then I think an LLM in Taxation is a great idea. But don’t sign up for a program just so that you can say you have it. Your time and your money are far too valuable.

As to the online component, I don’t know even to judge. I have taught courses for paralegals online and I do think online education has a place but I don’t know how comfortable I am saying that extends to sophisticated tax matters. Perhaps one of my colleagues could weigh in?

Taxpayer asks:

I’m an international student who arrived to the US 2 years ago. In my immigration process, I listed myself as (economic) dependent of my parents, who live in Mexico and cannot claim me as a tax dependent.

My brother, who just finished his master here at the US, currently started working and he might be able to claim me as a tax dependent. However, we don’t know whether I would have a problem or not in my immigration issues because I did not include him as a sponsor or anything while getting my student visa.

I hope you could ask is question because not even my international advisors could give me an answer.

Thank you very much.

Taxgirl says:

I don’t do immigration law – and that’s really what this question is about. From a tax perspective, if you meet the criteria as a qualifying relative, then your brother can claim you. There are four tests that must be met for a person to be your qualifying relative. The four tests are:

  1. Not a qualifying child test,
  2. Member of household or relationship test,
  3. Gross income test, and
  4. Support test.

Briefly, a child is not your qualifying relative if the child is your qualifying child or the qualifying child of any other taxpayer (sounds like that’s the case here).

To meet the member of household or relationship test, a person must either live with you all year as a member of your household, or be related to you in one a number of ways as determined by IRS (and yes, brother works with that one).

To meet the gross income test, the dependent’s gross income for the year must be less than $3,700 (if you’re here on student visa, this shouldn’t be a problem).

Finally, to meet the support test, your brother generally must provide more than half of your total support during the calendar year (some exceptions apply here – especially if your parents are also providing support).

So that’s the tax bit.

The immigration bit is more complicated. I asked my husband, Chris Erb, who practices business immigration law to chime in on this issue. Basically, when you applied, we’re going to assume that you and your parents provided documentation that you had the financial means to pay for your stay in the U.S. So long as you pay your bills, it shouldn’t make a difference whether your brother is helping you out (again, keeping in mind the tax criteria). As Chris sees it, the bigger risk is if you did not disclose on your application that you had a brother in the U.S. Failure to have made that disclosure could raise concern about whether you intend to leave the country which, as you know, is a condition of your student visa (“non immigrant intent”).

Hopefully, that helps.

Taxpayer asks:

Hi Taxgirl. Glad to find you here. I’m hoping you can offer clarification or a referral. I’ve talked to a financial planner and the IRS and neither can give me a clear answer. They both said I need a tax advisor, but of course funds are tight.

My question: how can I determine with any certainty whether I qualify for a penalty-free withdrawal from an IRA? I currently have a 401k through my former employer but was told that the hardship withdrawal option only applies to employees (of course if I did not get laid off, I would not need the hardship withdrawal.) The financial planner told me if I roll over to a traditional IRA that I MAY qualify for a penalty free withdrawal. The IRS could not tell me whether I would qualify and I don’t want to roll over if it gives me no additional options for withdrawal.

A follow up question is: if I do not qualify for a penalty free withdrawal, then is there an option applicable to 401ks to withdraw penalty free within 6 months of loss of employment or file a return amendment, similar to an employee IRA?

Hope you can help. Thanks for your efforts.

Taxgirl says:

I think your financial planner got it backwards. You can take distributions from your IRA at any time. If you make a withdrawal before ago 59 1/2, you may be subject to an additional 10% tax (penalty). There is no need to show a hardship in order to take a distribution because there is no hardship exception to the penalty. Under the code at Section 72(t), there are exceptions to the penalty which include medical expenses, the costs of higher education, QDROs and buying your first home.

You can it make a hardship withdrawal from a 401k if you meet the hardship criteria because of an “immediate and heavy financial need” for which the amount of the distribution is sufficient to resolve (you can’t take more out than you need). However, as you noted, that applies to employees. If you are no longer an employee, you may be able to take a penalty-free withdrawal from your 401k in the year you turn 55, or later OR if you have set up a payment schedule to withdraw money in substantially equal amounts over the course of your life expectancy. This is sometimes referred to as the 72(t) exception.

It sounds like you might need to consult with another financial planner or perhaps your HR folks to work through this. It can be tricky and, as you noted, you don’t want to do the wrong thing here since the consequences can be costly.

Taxpayer asks:

Hello tax Girl,

We presented a sales incentive rebate program to a prospective customer. He liked it but asked to be paid in gift cards instead of receiving checks.

If we honored his request we would still be obligated to provide him with a 1099 at the end of the year, correct? So his rather obvious attempt to avoid paying taxes will not work unless we were dumb enough to facilitate his plan by not sending him a 1099.

Please answer this one.

Thanks for your help.

Taxgirl says:

Yep. If you’re paying in gift cards, you’re paying in cash or cash equivalent. If you were required to issue a form 1099 while paying by check, you’re required to issue one if paying in gift cards.

You’re right to question something that feels like it’s too clever by half. While there are techniques for saving on taxes, it’s rare that it can be had simply by switching a tax form or changing the manner of payment. If you’re not sure, always ask a tax professional.

Well, that’s a wrap for this edition of the Sunday mailbag. Thanks so much for reading! I love getting mail from my readers. But there are rules – there are always rules. Be sure to read my disclaimer… Remember, I’m a lawyer and we love disclaimers. But you know who loves them more? My malpractice carrier. Consider yourself warned.

If you still have a question, check out these tips before you “ask the taxgirl.”

The upside of a down economy: as Congress puts more emphasis on tax collections, the Internal Revenue Service (IRS) needs more workers. Voila. Increased employment.

And no need to worry about expensive promotional materials or classified ads that might get overlooked. The IRS has gone all modern on us, using YouTube as a recruiting tool. A new series on its YouTube channel called “Working at the IRS” now promotes a look at some of the job opportunities available at IRS. Here’s a peek at one of the videos:

The IRS has more than 100,000 full-time and seasonal employees across the country. It’s a number that may continue to grow as audits and collections matters

For more information, you can check out the IRS’ jobs website at www.jobs.irs.gov.

The employee plans division of the Internal Revenue Service (IRS) has hired two law student interns this year, the first time ever for this division. If all goes well, the plan may be expanded.

The two students are from the John Marshall Law School in Chicago but will work in the IRS Washington office for three months this summer. The students won’t be paid or receive a stipend (fairly normal for an internship) but will get school credit (also normal for an internship).

The IRS points out that law interns have worked in other parts of the IRS in the past. This is true. Count me as one of them. I interned at the Philadelphia office of the Estates Tax Audit Division in my final year of law school. Talk about getting some hands-on training…

In this economy, this is a great opportunity for these students. As the IRS points out, it’s the best place to get exposure to the whole regulatory process, from the legislative start to the implementation of regulations in the field. You can’t get that kind of experience at any law firm.

The IRS is hopeful that this program might lead to further recruiting for the Service. I wouldn’t be surprised. In terms of IRS attorney positions, competition is tough – and in this economy, I’ll bet it’s even more difficult. When I was at IRS, we were told very frankly that the IRS basically tosses any resumes for the tax attorney positions from those without an LLM Taxation.

It appears, though, that the positions which the IRS hopes to woo may not be “attorney” jobs per se. The Service is already looking for revenue agents and tax law specialists. Agents who serve in such positions may have a law degree, but not all positions require one.

This is such a step in the right direction for the IRS. Rather than continue a culture of government employees getting government jobs, why not start poking around more in the private sector? Getting students enthusiastic about working for the IRS in law school will go a long way towards building up the pool of talent at the IRS. Maybe more tax students will see it as a first step rather than a last resort…

Taxpayer asks:

As a newly minted lawyer that is now doing contract work, I was wondering if Bar exam prep classes are tax-deductible? Or any licensing fees, occupation state taxes, or expenses related to GETTING a law license are tax-deductible. There is a thread on JDU on this but no one seems to have a clear answer. Thanks!

Taxgirl says:

Ooh, as a newly minted lawyer, you’ll appreciate that my answer is yes – and no.

Easy one first: state and local taxes are deductible if you itemize your deductions. So, include any state occupational taxes on Schedule A.

Bar exam prep classes are not deductible to an individual taxpayer, nor are expenses relating to getting a law license. Some work-related education expenses can be deductible if they are required as a condition of continued employment (think CLEs, for example), but you cannot deduct work-related education expenses if they are needed to meet the minimum requirements to qualify you to work or if the expenses will lead to qualifying you in a new occupation. Bar prep fees are not deductible since they’re not required (!) as a condition of your employment. Bar application fees and the like don’t count since they are the minimum requirements to get you started in the profession – you can’t work as a lawyer without being admitted to the bar.

Dues for professional organizations, like bar associations, are deductible as miscellaneous expenses on Schedule A. Subscriptions to law journals and the like are similarly deductible.

Since a few folks raised the LLM as an issue on the thread that you linked to in your question, I’ll address that, too. The cost of an LLM is not automatically deductible: you must still meet certain criteria. For one, the LLM must be to maintain or improve skills required in your present work or it must be required by your employer or by law to keep your salary, status, or job. Even if you meet one of those criteria, you cannot deduct the expenses if the education is needed to meet the minimum educational requirements to qualify you in your trade or business (as with your JD), or is part of a program of study that will lead to qualifying you in a new trade or business.

As a tax lawyer, one of my first tax law jobs was contingent on my earning my LLM Taxation: that made my additional degree deductible.

(Editor’s note: see comments below.)

Similarly, if you decide to jump from one area of the law (say, trial work) to another (contract law, for example), you cannot deduct the cost of additional education to make that jump. Your additional educational expenses must be related to your present job in order to qualify, in most instances, as a work-related deduction.

(All of that said, the cost of an LLM may qualify for certain educational tax credits, like the Lifetime Learning Credit.)

So, some yes, some no. I hope that helps clear up the confusion!

Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.

Below is the list of tax jobs for this week.

(I had hoped to post them over the weekend but I was a wee bit busy… Yes, I’ll gloat. I ran my first ever competitive race this weekend, an 8k. I did okay for a first timer.)

1, Tax Manager – Madison, WI

2, Senior Tax Manager – Raleigh, NC

3, Senior Tax Specialist – Raleigh, NC

4, Tax/Estate Attorney – Worcester, MA

5, International Tax Specialist – Atlanta, GA

6, Expatriate Tax Senior – Philadelphia, PA

7, Business Tax Advisory-Diversified Tax Senior – Memphis, TN

8, Adjunct Instructor of Accounting – Coon Rapids, MN

9, Assistant Professor of Accounting – Alamosa, CO

10, Assistant/Associate Professor of Business Law – LaCrosse, WI

11, Seasonal Tax Positions – Various Locations (H&R Block)

12, International Human Resources Tax Team Expatriate Administrator – Montgomery Co, MD

13, Senior Tax Associate – Pittsburgh, PA

14, Director, Corporate Tax – Atlanta, GA

15, Senior Accountant, International – Burbank, CA

16, Senior Manager – Tax – Baltimore, MD

(Psst, I can’t vouch for these openings, so please exercise good judgment!)

If you’re looking to hire, send me the details via email and I’ll post the info in my next edition of Tax Jobs.

I know, I know, it’s tough out there. But on the plus side, tax season is coming! Here are some tax jobs that I’ve seen advertised as of late:

1, Senior Tax Accountant – Palm Beach County

2, Senior Tax Accountant – Philadelphia

3, Tax Accountants – East Norriton, PA

4, Tax Preparer – West Chester, PA

5, International Tax Specialist – Pittsburgh

6, Tax Preparation – Pittsburgh

7, Tax controversies attorney – NYC

8, Tax Attorney for Small Firm – Los Angeles, CA

9, Tax, Trusts & Estates (Paralegal) – NJ

10, Corporate Tax Attorney – Santa Clara, CA

11, Corporate Tax Manager – Boise, ID

12, Employee Benefits Tax Manager – Chicago, IL

13, Senior Tax Analyst – Portland, OR

14, Business Tax Advisory, Diversified Tax Senior – Greensboro, NC

15, Associate Level Tax Attorney, Greenberg Traurig – Denver, CO

16, Tax Analyst, IRS – Cincinnati, OH

(Psst, I can’t vouch for these openings, so please exercise good judgment!)

If you’re looking to hire, send me the details via email and I’ll post the info in my next edition of Tax Jobs.

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