The Beanie Baby Fortune Is Safe
In the early 1990’s, toy company Ty Warner, Inc. began producing tiny stuffed animals known as beanie babies. The product’s popularity quickly took off, and the toys became an instant collector’s item. The company produced only a few of each design, and shipped limited quantities to retailers. This strategy helped make collecting the toys a valuable enterprise. And, it didn’t hurt the bottom line for the company either, with sales of beanie babies accounting for a large portion of the company’s profit margin.
In recent years, headlines have focused not so much on the value of a beanie baby, but on the company’s owner. Ty Warner has made news lately regarding his fortune, and the taxes that go along with the fortune. The story goes like this:
- Warner placed more than $100 million in a Swiss bank account, allegedly to avoid taxation in the US.
- An investigation by federal prosecutors culminated in tax evasion charges against the billionaire, and a Court recently ruled Warner would not go to jail for his actions, but will pay $16 million in back taxes and interest and a $53.5 million penalty.
- Mr. Warner’s sentence without jail time is the most recent in a continuing trend of mercy shown to taxpayers who attempt to rectify past mistakes through voluntary disclosure.
This story shows the benefits of voluntary disclosure to the IRS when you perceive a tax problem. When it comes to taking on the IRS, you must be aware of the ins and outs of the tax laws, and how they apply to your particular situation. No two cases are the same, but every case deserves careful analysis. We have the experience necessary to pinpoint the nuances of your case, and make arguments that work best for you. Call our office today to talk about your case, and together we will develop a strategy that fits.