Pietro Canestrelli is a tax attorney and former IRS attorney who helps business owners and taxpayers protect their hard-earned money. As the founder of the Law Office of Pietro Canestrelli and author of America's Tax Defender, he focuses on getting the IRS out of your life as fast as possible.
In this episode, Pietro breaks down the three areas of tax work: compliance, proactive planning, and tax defense. He explains why being audited is actually a "badge of success," why CPAs don't do proactive tax planning, and shares underutilized strategies like R&D tax credits and cost segregation that could save business owners tens or hundreds of thousands of dollars.
Want to learn more about Pietro's work? Check out his website at https://ietaxattorney.com/.
Connect with Pietro on LinkedIn at https://www.linkedin.com/in/pietro-canestrelli-18032a21.
Key Points & Timestamps
- 00:00:51 - Pietro Canestrelli introduced: Former IRS attorney, author of America's Tax Defender, helps business owners with tax planning and defense
- 00:01:15 - "My job is to get the IRS out of your life as fast as possible"
- 00:02:41 - The three sections of taxes: compliance, proactive planning, and tax defense
- 00:03:04 - Proactive tax planning: mapping out strategies during the year to save tens or hundreds of thousands
- 00:04:26 - Tax defense and controversy: from audit level to US Tax Court litigation
- 00:05:52 - Why auditors prefer working with tax attorneys: speaking the same language
- 00:06:33 - The importance of having representation during an audit (like having an attorney when questioned by police)
- 00:11:25 - Being audited is a "badge of success" - it means you're doing well
- 00:17:49 - Why CPAs don't do proactive tax planning: their business model is compliance and filing returns
- 00:22:03 - Two underutilized strategies: R&D tax credit and cost segregation on real estate
- 00:25:10 - What NOT to do: pretending you didn't make income or guesstimating business deductions
- 00:30:28 - About Pietro's book "America's Tax Defender": contrasts IRS bureaucracy with passionate client advocacy
- 00:34:50 - How to reach Pietro: ietaxattorney.com or Amazon for his book
Transcript
[00:00:05]
Craig Andrews
I was in a coma for six weeks while the doctors told my wife I was going to die. When I woke up, she told me the most fantastic story. My team kept running the business without me. Freelancers reached out to my team and said, we will do whatever it takes. As long as Craig's in the hospital. I consider that the greatest accomplishment in my career.
[00:00:30]
Craig Andrews
My name is Craig Andrews and this is the Leaders and Legacies podcast where we talk to leaders creating an impact beyond themselves. At the end of today's interview, I'll tell you how you can be the next leader featured on this show.
[00:00:51]
Craig Andrews
Today I went welcome Pietro Canestrelli. He is the founder of the Law Office of Pietro Canestrelli . He's also the author of America's Tax Defender. He was a IRS attorney and now he's focused on helping business owners and taxpayers protect their hard earned money.
[00:01:10]
Craig Andrews
Let me play a little more directly. Something,
[00:01:13]
Craig Andrews
Pierre just said in the green room.
[00:01:15]
Craig Andrews
He said his job is to get the IRS out of your life as fast as possible. And,
[00:01:22]
Craig Andrews
from a legal aspect, legal approach. Pietro, welcome.
[00:01:28]
Pietro Canestrelli
Hey. Good morning. Great to be on. Yeah. Thank you for having me.
[00:01:33]
Craig Andrews
I've been looking forward to this. And we,
[00:01:35]
Craig Andrews
you know, we almost had started a few weeks ago, and then there were some tech issues, and. Yeah,
[00:01:40]
Craig Andrews
I was so glad to see you back on the schedule and the chance for us to talk.
[00:01:45]
Craig Andrews
You know, and, I'm not sure what you're going to bring, but let me let me kind of launch him with a story that,
[00:01:52]
Craig Andrews
from some I, I know I have,
[00:01:53]
Craig Andrews
you know, a mentor of mine, as a, obviously as a CPA, but he has a tax attorney that works for him as well.
[00:02:02]
Pietro Canestrelli
Right.
[00:02:03]
Craig Andrews
And the IRS, mark man. What's that?
[00:02:06]
Pietro Canestrelli
Smart man.
[00:02:08]
Craig Andrews
Yeah, well, the IRS showed up one day with an audit saying that he owed the IRS $40,000. He's like, oh,
[00:02:16]
Craig Andrews
let me call. Let me call my attorney. And his attorney came over and started sitting down with the IRS agent. And before he knew it, when he owed the IRS $40,000, the IRS owed him $40,000. Now. And I think there was an IRS agent that went away crying that morning and was humiliated and mocked when he got back to the office.
[00:02:34]
Pietro Canestrelli
Yeah, yeah, that is what an, and a tax attorney brings to the table.
[00:02:41]
Pietro Canestrelli
Taxes is really divided up into three sections. What we're used to is what I call tax compliance that is preparing and filing correct tax returns. And that is a job,
[00:02:55]
Pietro Canestrelli
as a CPA or a other type of preparer and a that, that sort of thing, they, they do compliance and they do it very well.
[00:03:04]
Pietro Canestrelli
What a tax attorney does is really focuses on the other two areas. The first is proactive tax planning, meaning not the rush in December to buy equipment or a car to to get the deduction, but to actually sit down with you during the year and map out strategies that could save you tens or even hundreds of thousands, sometimes millions of dollars in taxes, depending on your situation.
[00:03:34]
Pietro Canestrelli
If you do, if you plan and you do your business, a certain way instead of doing it a you do it. B you could save a lot of taxes because there's all sorts of ways to do that within the tax code. That's perfectly legal.
[00:03:50]
Pietro Canestrelli
But you have to not make up stuff. You have to actually have planning and actually do the type of transactions you need to do.
[00:03:59]
Pietro Canestrelli
And then lastly, where I shine and where I come from and, and kind of the stuff I love the most is tax defense tax controversy. And that is starts at the audit level. But that could be US tax court litigation. That could be federal Tax court, federal court litigation refund suit. That's when you really are arguing the law.
[00:04:27]
Pietro Canestrelli
And you have to, you know, one of our main mottos in our firm is we change the asymmetry of,
[00:04:37]
Pietro Canestrelli
knowledge about taxes into your favor. Remember, when you're sitting down with an IRS auditor, that auditor, she does this all day, every day, and she knows what to do.
[00:04:52]
Pietro Canestrelli
What to ask you to make you answer the questions she and get the answers she wants you.
[00:04:59]
Pietro Canestrelli
Even if you haven't, you've probably haven't been through an audit. You don't know how it works. You want to get out of there as quickly as possible. You're very stressed. You're very scared. You. You think there might be issues that you don't want to talk about, so you're trying to get it done as quickly as possible and just tell her what she wants to hear.
[00:05:19]
Pietro Canestrelli
That's the opposite approach you should take. You should have a tax attorney that actually knows the law better than the auditor, because these are trained attorneys. The auditors are not attorneys. They work out of handbooks. And when I was with the IRS, I helped prepare those handbooks. And I don't want to say they're a dumbed down version of the law, but they are a simplified version of the law because we're not dealing with attorneys, and their job is to make an assessment.
[00:05:52]
Pietro Canestrelli
So they're going to stretch it any way they can to, to have you owe 40,000. At the end of the day.
[00:06:01]
Pietro Canestrelli
But a tax attorney is going to say, hey, wait a minute, you got the law wrong here. And and look at this. And oh, it turns out there's a 40,000 refund coming. So yeah, I could that happens in our business all the time.
[00:06:18]
Craig Andrews
You know, as you're describing that the thing that hits me is, you know, I've kind concluded if I'm ever being questioned by the police for any reason. Yeah. I'm going to say I want an attorney here. Yes.
[00:06:33]
Pietro Canestrelli
Right, right.
[00:06:34]
Craig Andrews
And it hit me as as you're talking, it's like if you're ever going through an audit, it's kind of the same thing. They. Yes, they they have a playbook and we've seen, you know, certainly within the FBI, it's not about innocence or guilt. It's about being able to get a conviction. They figure out how to get you to say things like that, leave you trapped, even if you're not guilty.
[00:06:57]
Pietro Canestrelli
You're you're absolutely right. You're absolutely right. And that they know how to do this. You have no clue. And if you could have somebody show up and and a lot of audits, our attorneys are the ones that are speaking to the,
[00:07:15]
Pietro Canestrelli
the auditor directly, meaning we have all the material, we have all the documentation that the auditor needs.
[00:07:22]
Pietro Canestrelli
And we're going to go through it with the auditor and not have the client, the business owner there.
[00:07:29]
Pietro Canestrelli
Now, we may have to get specific information from the business owner, but we don't want him sitting down and talking to the auditor. We want I.
[00:07:39]
Craig Andrews
Could see scenes. I can see scenes where you're sitting there shoulder to shoulder with your client. Right? And you're like, in and put a gag on your client, say, shut up. Quit saying that stuff.
[00:07:48]
Pietro Canestrelli
Right, right. And so I'd rather not even have them there. What the. The other thing is, if we bring is we could look at your what the IRS is asking for and we'll know what their what they're getting that really quickly because it's pretty standard. It's it's substantiation of expenses. It's underreporting of income. Most audits are I don't want to say simple, but those are the issues.
[00:08:18]
Pietro Canestrelli
Or they're looking at a particular complex transaction and whether you did it properly. So those are always the issues. And it's easy for us to diagnose where you're weak, where you're strong. You know how we're going to set the narrative with the auditor, you know. Oh yeah. We we might have,
[00:08:39]
Pietro Canestrelli
you know, on this bank statement, it looks like we underreported income.
[00:08:43]
Pietro Canestrelli
But in reality, that was winter. It was a loan. It was,
[00:08:48]
Pietro Canestrelli
some transfers. It really isn't taxable income. So we could I and I personally think auditors,
[00:08:55]
Pietro Canestrelli
for the most part, there are some holdouts, but for the
[00:08:58]
Pietro Canestrelli
for the most part, I think auditors prefer to work with us too, because they're, they're we're speaking the same language.
[00:09:06]
Pietro Canestrelli
Right. We know if they ask for something they don't have to explain to us what they're asking for and why they're asking for it. So I think a lot of times now, sometimes they don't, sometimes they get mad when the attorney shows up.
[00:09:22]
Pietro Canestrelli
But I think it's less most IRS person. It's more about apathy versus, you know, revenge or anger or anything like that.
[00:09:35]
Pietro Canestrelli
Most IRS and I spent six years with the IRS, those IRS personnel, they they just don't care,
[00:09:44]
Pietro Canestrelli
more than they they're angry at a particular taxpayer or they're they're trying to get a particular taxpayer.
[00:09:52]
Pietro Canestrelli
Remember, it's the government. There's no they don't get any bonus based upon how successful they are in the audit. They're supposed to do a good job.
[00:10:05]
Pietro Canestrelli
But and especially now with all the hires, new hires, they've had a couple of years back, these people aren't even really trained all that well. So I don't. And I don't think the manager meant as pushing them. So it really is. You don't want them to care. You want them to be in that kind of government bureaucracy, state
[00:10:30]
Pietro Canestrelli
that they don't care about that.
[00:10:33]
Pietro Canestrelli
The worst thing is to to insult them and be nasty to them. And I've had that cases where a taxpayer just flips out, then we got to calm everybody down.
[00:10:44]
Pietro Canestrelli
And, and let's not scream and yell and cuss at the auditor. She's doing her job.
[00:10:50]
Pietro Canestrelli
Let's get a professional and to help you. And we'll get through this.
[00:10:55]
Pietro Canestrelli
Let's not take a six months process and drag it out to two, three years and spend twice the money on it. Then we have to let let's deal with it at their level. But and protecting your rights. And let's not blow this up into something bigger and uglier than it needs to be. If you're a successful business owner, I'm sorry.
[00:11:18]
Pietro Canestrelli
If you're a successful business owner, one badge of your success is you're going to be audited.
[00:11:25]
Craig Andrews
Yeah, yeah. And I think, I mean, that's a really good point. A a a badge of success. I you know, it's funny, I tell people years ago,
[00:11:37]
Craig Andrews
I was with a company, we were marketing a new product for a semiconductor product for mobile phones. And the sales guys came to me and they said,
[00:11:46]
Craig Andrews
Craig, the competition's saying horrible things about it to the customers.
[00:11:50]
Craig Andrews
And I said, that's wonderful news. And they looked at me like I had two heads. And they were like, why you say, that's wonderful? I said, we've earned the right to be bashed. Right? And so what you're saying is if you're getting audit, it, that's a badge of success. That means you're doing really well and you recruit.
[00:12:11]
Pietro Canestrelli
You should be proud. You should be. This is part of doing business in the US. And the other the other great thing is you do have a huge amount of rights, more than any developed country. Let alone underdeveloped country.
[00:12:28]
Pietro Canestrelli
You have a huge amount of rights as a taxpayer in this country. And now exerting them is is the key.
[00:12:35]
Pietro Canestrelli
And having the right people to do that for you is the key.
[00:12:40]
Craig Andrews
And I won't jump back to something you said a minute ago about not getting emotional and not getting bombastic. I just think that's, you know, good advice all around.
[00:12:51]
Craig Andrews
Yeah. It's I mean, I know it works in the movies where somebody yells and screams, you know, but I think on this side of the silver screen and in real life, I, I think it always works out better when you can dial down the emotions rather than dial up.
[00:13:08]
Pietro Canestrelli
Right. That's not going to, you know, ultimately,
[00:13:13]
Pietro Canestrelli
a tax court judge is going to make a decision on a case, you know, and tax court judges are not interested in yelling and screaming and pounding tables. No nobody is. And yeah, it makes for great television. But it's all about facts and numbers and narrative and legal analysis and pointing out stuff.
[00:13:40]
Pietro Canestrelli
And do you really want to go to trial? And one of the advantages a taxpayer has in court is that they can't they're ethically bound not to take crazy stances,
[00:13:56]
Pietro Canestrelli
really aggressive stances in the law.
[00:13:59]
Pietro Canestrelli
But we can't,
[00:14:01]
Pietro Canestrelli
if we're if we're representing a private,
[00:14:03]
Pietro Canestrelli
a private party, you know, a taxpayer, we can take legal stances that are a little bit off the path, so to speak, that we think we could convince a judge.
[00:14:15]
Pietro Canestrelli
But the IRS is bound by their decisions in the past, and they're they're not supposed to be vindictive and have these new,
[00:14:29]
Pietro Canestrelli
legal theories that they're going to use against you. So that's another advantage that a taxpayer should be using. And I don't understand the table pounders. I've I've had in my past, I've had some,
[00:14:45]
Pietro Canestrelli
private litigation like in probate where the guy was extremely aggressive and it didn't get him anywhere.
[00:14:52]
Pietro Canestrelli
I wasn't intimidated by him because he was talking, you know, aggressively. I was like, you're you're just wrong. And I don't understand why you're taking this position. Are you trying to intimidate us? It's it's not going to work. So I don't understand it either. But some people go to that. I think it's it's a tactic, but it's not going to work on me.
[00:15:18]
Craig Andrews
Well, I remember,
[00:15:20]
Craig Andrews
I remember the worst I was ever chewed out ever. And let me just give some framework. I spent six years in the Marine Corps. I know what the chewing out looks like. Yeah, but the worst ever got chewed out was by a senior director at Siemens over in, Germany. And he used three slides that just ripped me to shreds.
[00:15:44]
Craig Andrews
I had, you know, contacts. I had a, I worked for a guy that would go promise things to the Germans that he knew at the time we couldn't deliver. And my job was to go tell the Germans we weren't going to deliver it. And, and this and they were, I have to say that the Germans,
[00:16:00]
Craig Andrews
there were wonderful people.
[00:16:02]
Craig Andrews
I really enjoyed working with them. They were very gracious towards us. All right.
[00:16:06]
Craig Andrews
But this guy is about regret. Came in and in three slides. It was fine when he walked in the room. The rest of the team, you saw him, like, sit up in their seats. I'm like I commanded respect, right? He came in and he was just so nice.
[00:16:18]
Craig Andrews
He's like, sorry to interrupt.
[00:16:20]
Craig Andrews
You know, do you mind if I give a short presentation? I'm like, of course, Mr. Riker. And in three sides. I've never felt like I wanted to crawl under a rock more. He didn't yell, he didn't scream. He just presented the facts. Slides one and two were on this day. You promised this, but you did this.
[00:16:38]
Craig Andrews
On this day. You promised this, but you did this, right. Slide three was here's what we expect from our suppliers. It was all calm. It was all reasonable. I've never felt so crummy in my life.
[00:16:48]
Pietro Canestrelli
Right, right. Yeah, exactly. That's the way to go. That's the way to present a tax case. This is why you are wrong. Factually. Here is the facts that you got wrong. And here's the documentation that proves it legally. This is why you're wrong. Here's the code. Here's case law. You're wrong about this. And this is how you present a case.
[00:17:12]
Pietro Canestrelli
And I'm not trying to have a pissing contest about it. It's just this is what it is. We could get it done at this stage. We could go to tax court. We could go to appeals. It's up to you.
[00:17:28]
Pietro Canestrelli
We're not going to accept this audit.
[00:17:31]
Craig Andrews
Yeah. Let's,
[00:17:33]
Craig Andrews
let's pivot a little bit. You know, one of my frustrations has been that I'm the one going to my CPA saying, hey, I heard about this tax strategy. It's like, oh yeah, that's out there. I'm like, why am I telling you?
[00:17:49]
Pietro Canestrelli
Because his business model and I have enormous respect for CPAs. But CPAs and other preparers, they do compliance. That is their business model. Their their business
[00:18:01]
Pietro Canestrelli
model is I'm going to make a portfolio of returns. I file every year, and I'm going to have a high retention rate. I'm going to have a retention rate of 95%. And I'm going to get X amount of more returns every year.
[00:18:19]
Pietro Canestrelli
So I'm going to build my business till I'm doing, you know, a couple thousand returns every year. I know how much money I'm going to make. I know I'm going to have to work really hard in March and April and then take a month long vacation in May and then work really hard in extension season. And
[00:18:39]
Pietro Canestrelli
I know I could build a business and be extremely successful doing that.
[00:18:44]
Pietro Canestrelli
I am not interested in doing proactive tax planning, because that is something that I'm going to have to take time and effort. It takes a huge amount of time and effort to learn how to file those tax returns and report the taxes correctly, and all the different forms and all the nuances to that. There's a lot of nuances.
[00:19:05]
Pietro Canestrelli
You could take a deduction here, or you could take a deduction on this part of the return. A lot of nuances, a lot of updates. Every single year that you have to learn. So I'm not really interested in doing proactive tax planning. And this is probably 90, 95% of CPAs are not interested in doing this because that means I have to learn a whole nother thing.
[00:19:28]
Pietro Canestrelli
And how am I going to charge my client? Am I going to charge him more
[00:19:32]
Pietro Canestrelli
for the return if I do this? And how do I know if the client is actually doing what he needs to do to take this deduction?
[00:19:44]
Pietro Canestrelli
So that's where tax planning with the attorney tax attorney comes in and that we meet with you in least quarterly during the year.
[00:19:53]
Pietro Canestrelli
Some clients weekly, we meet monthly. We make sure they're on track to take the research and credit,
[00:20:01]
Pietro Canestrelli
development credit to do a cost segregation study on their building, all those things you need to be doing during the year. The CPA is not interested in monitoring you. No, he doesn't know how to monetize this, doesn't know how to charge for it, doesn't know how to.
[00:20:19]
Pietro Canestrelli
He doesn't have the system set up where you have an attorney assigned to each one of these client who's doing this regular cadence of meetings, who has that list of deliveries already did the analysis of what we're going to do this year has that list of deliverables that we're given to the client, and then
[00:20:39]
Pietro Canestrelli
that the client has to,
[00:20:41]
Pietro Canestrelli
give to us.
[00:20:43]
Pietro Canestrelli
And we're making sure everything is happening correctly and we're checking where he is tax wise during the year. Now, you're still going to know about $100,000 of taxes. Maybe we'll think about doing this in the third quarter. And I don't doubt a lower rate. Oh, you're having an even better year.
[00:21:05]
Pietro Canestrelli
Fourth quarter. Let's look into some, you know, oil and gas, credit investments, that sort of thing.
[00:21:14]
Pietro Canestrelli
You have to pay for that. You remember, you're paying for your return and the the preparer does want to do your return every single year because he knows it's margin on that return. And he makes money on it. He doesn't know what how he's going to make money doing tax planning. So yeah you need a tax attorney.
[00:21:38]
Pietro Canestrelli
There's going to be a lot more helpful in this situation. Now some CPAs do proactive tax planning, but not not many. Not as many as you think would be.
[00:21:50]
Craig Andrews
You know, and that's been a big lesson for me with
[00:21:54]
Craig Andrews
let me ask this. What are a couple examples of,
[00:21:58]
Craig Andrews
tax strategies that most business people should be using but probably aren't?
[00:22:03]
Pietro Canestrelli
Well, I just mentioned a couple of them. One is the research and tax credit in the OB, the one big beautiful bill, the tax provisions, the research and development credit is really worth 3 or 4 times what it worth before that,
[00:22:20]
Pietro Canestrelli
that that bill became law and most,
[00:22:25]
Pietro Canestrelli
business owners don't realize that they probably qualify for at least a small,
[00:22:30]
Pietro Canestrelli
relatively small credit.
[00:22:31]
Pietro Canestrelli
Most people think research and development is for high tech firms or manufacturers. But constructions, medical
[00:22:39]
Pietro Canestrelli
construction,
[00:22:40]
Pietro Canestrelli
medical, even like service based companies may be eligible for,
[00:22:48]
Pietro Canestrelli
research and development credit. And that's a dollar for dollar tax credit versus a deduction. The other thing that I don't know why more people don't know this, but, you know, the cost segregation,
[00:23:04]
Pietro Canestrelli
on real estate.
[00:23:05]
Pietro Canestrelli
And that's when you buy an investment property.
[00:23:09]
Pietro Canestrelli
It could be commercial. It could be residential. And instead of having that 42 year depreciation schedule, you could segregate the cost between the real estate and the personal property like fixtures and, and carpet and that sort of thing, and get frontload the deductions,
[00:23:33]
Pietro Canestrelli
the depreciation deductions.
[00:23:35]
Pietro Canestrelli
And that is something that if, if you're investing in real estate, you really should be doing,
[00:23:44]
Pietro Canestrelli
that and the nice thing about cost seg, you could really time that deduction for a year that you have income to offset.
[00:23:52]
Pietro Canestrelli
So those are two that people don't take enough advantage of, especially the R&D. The R&D is a lot broader than most people think. And now the problem is most of the R&D specialty shops that, you know, focus on this, they're not looking for the small, what I call the small business center, which is, you know, $1 million of revenue to to 5 or $10 million of revenue.
[00:24:28]
Pietro Canestrelli
They're really looking at the ten, $20 million businesses, and they're marketing towards those guys because those they know that, you know, there's going to be huge credits in that. So but where, you know, as part of our tax strategy, we we have a lot of tools in our toolbox to, to help, you know, be as tax efficient as possible and R&D and cost SEG or certainly really great tools.
[00:24:58]
Craig Andrews
So let me ask this. What is the most salacious tax deduction you've ever seen or salacious tax strategy?
[00:25:08]
Pietro Canestrelli
Let me tell you what
[00:25:10]
Pietro Canestrelli
tax strategy is how to do it wrong. And that is and this happens all the time because we represent these clients that is
[00:25:23]
Pietro Canestrelli
I'm going to owe a lot of taxes this year. You know, I'm going to pretend I didn't make as much income, and I'm going to pretend that I have a lot more business.
[00:25:35]
Pietro Canestrelli
I'm going to guesstimate my business deductions. And that is things that,
[00:25:44]
Pietro Canestrelli
you know, you know, always have the personal, trying to be pushed into the business as a business expense. The, you know, the, the trips to Cancun and you could go to Cancun, make sure there's a convention that the convention there that is part of your industry.
[00:26:04]
Pietro Canestrelli
You know, you could go to Hawaii, you could go to Vegas. There's all sorts of conventions all over the place.
[00:26:10]
Pietro Canestrelli
Make sure that it's part of that and that you're spending time and you're actually logging in the time of what? And grabbed the brochures of the convention, the the seminars you had to sit through, you know, between all time, you could push those into business.
[00:26:30]
Pietro Canestrelli
But when you're, you know,
[00:26:32]
Pietro Canestrelli
a lot of the one here that I, I cringe because I, I see this on TikTok and other social media is like in California, we have a use tax, we have a sales tax and a use tax. Meaning if you buy equipment from another state and you're using it in California, you you owe used tax to the California,
[00:26:57]
Pietro Canestrelli
authorities.
[00:26:58]
Pietro Canestrelli
And a lot of people are like, I live in California. California has a really high,
[00:27:03]
Pietro Canestrelli
vehicle license. So what I do, I go to Nevada, I buy my vehicle there, I pay, you know, 25% of what California is. And I bring it here and it's like you do. No. You sign a penalty of perjury against perjury statement on your income tax returns for California saying that you didn't do this and then that if they ever audit you, you owe taxes and penalties.
[00:27:33]
Pietro Canestrelli
This is illegal. What you're doing, it is not legal. So stop telling people to do that.
[00:27:41]
Craig Andrews
You know what?
[00:27:42]
Craig Andrews
Do you know what state is one of the top states for registering exotic vehicles?
[00:27:47]
Pietro Canestrelli
Probably Texas, maybe. I don't know.
[00:27:49]
Craig Andrews
Montana.
[00:27:51]
Pietro Canestrelli
Oh of course. Yeah. Yeah, that makes sense. They probably charge, you know, $15. I'm sure I know I'm like Calvin. I know for a fact, when my,
[00:28:02]
Pietro Canestrelli
oldest son moved to Florida, his registration, it went from like $700 in California to 150 in Florida. Same vehicle a year older. But yeah, there's there's huge savings. But my son actually lives in Florida.
[00:28:24]
Pietro Canestrelli
Yeah. That's it. Live in California. You got to follow the rules. And yeah, there's you know, you could you could pretend that the rule doesn't exist, but it it will catch up with it one day. They're they're very aggressive here in California. They have their rules and they're, they have a lot of resources to enforce those rules.
[00:28:47]
Craig Andrews
And if you're a millionaire, you just moved to Texas or Florida, which they're doing.
[00:28:52]
Pietro Canestrelli
Yes. Yeah. There's a huge exodus. There has been for a while. But now with the proposed wealth tax,
[00:29:01]
Pietro Canestrelli
a lot of people are shifting and long term, long term, anyone who can move, why pay, you know, 10 to 13%
[00:29:15]
Pietro Canestrelli
more in taxes then you have to. Yeah. If you could live in Florida or some other state that doesn't have an income tax, why do that?
[00:29:26]
Pietro Canestrelli
Why not now? Florida has beaches to,
[00:29:30]
Pietro Canestrelli
you know, Texas has beaches sort of to.
[00:29:33]
Craig Andrews
Yeah, their beaches suck. I'm been down South Padre. Beaches suck.
[00:29:37]
Pietro Canestrelli
Yeah.
[00:29:37]
Craig Andrews
But no, there's there's a podcast called The Island Podcast. And,
[00:29:42]
Craig Andrews
two of the members of that podcast have moved to Austin in the last year. Yeah. Bird is meeting with is,
[00:29:49]
Craig Andrews
meeting with a broker trying to find a property here in Austin.
[00:29:52]
Pietro Canestrelli
Yeah. And you actually have to move. You can't, you know, buy some real estate in Texas, but live still live in,
[00:30:03]
Pietro Canestrelli
in, in California and just pretend that you live in now you have to actually move because the California franchise Tax Board is not going to take your word for it, shockingly. And
[00:30:15]
Pietro Canestrelli
they're going to want you to show, you know, the receipts.
[00:30:21]
Craig Andrews
But, Peter, let's,
[00:30:22]
Craig Andrews
let's wrap up by talking about your book, America's Yes, Defender. Watts, tell me a little bit about that book.
[00:30:28]
Pietro Canestrelli
Yeah, it's.
[00:30:29]
Craig Andrews
A little higher a little bit higher. There you go.
[00:30:32]
Craig Andrews
Cool. What's it about?
[00:30:33]
Pietro Canestrelli
So it is a book, and it really,
[00:30:36]
Pietro Canestrelli
highlights my time with the IRS as a young attorney, starting out as an IRS attorney in Washington, DC, and kind of contrasting that with the way we practice law in my firm. And, you know,
[00:30:52]
Pietro Canestrelli
the IRS, you know, my time with the IRS,
[00:30:55]
Pietro Canestrelli
very educational. I learned a lot about taxes.
[00:30:59]
Pietro Canestrelli
I think the people I work with were were awesome people. I like them a lot intelligent, smart.
[00:31:06]
Pietro Canestrelli
But the system is so government, so bureaucratic, so non rewarding.
[00:31:14]
Pietro Canestrelli
Doing a good job, not punishing of doing a bad job. It was kind of soul crushing. I did not like. And the other thing, I was not helping anyone.
[00:31:25]
Pietro Canestrelli
When you're writing regs and you know doing helping in litigation, you're not helping anywhere. You're helping the government, I guess, in theory. But the government never says thank you or or you saved my life or you saved me so much money, and now I can have my life back. And you know, I don't have to move to Texas.
[00:31:48]
Pietro Canestrelli
Now, what does I think? Because,
[00:31:52]
Pietro Canestrelli
you saved me so much money and I didn't realize I needed that,
[00:31:56]
Pietro Canestrelli
when I first started out. But I hated working for the IRS.
[00:32:01]
Pietro Canestrelli
I don't think they're evil, but I do think that for me, it wasn't rewarding. Having that individual that, you know, is, you know, a lot of our clients, they have a huge tax bill because something happened in their life, meaning they got a divorce, they have substance abuse issues and they went downhill and they have this giant tax bill, and now they want their life back, or their fiance wants to marry them, but not their tax bill.
[00:32:35]
Pietro Canestrelli
And helping those type of people get their life back is is so hugely rewarding. Helping business owners that this audit could destroy our business if it goes bad and and being there for them and making sure that, hey, we're going to mitigate the damages of what this is and you're going to be able to still run your business at the end of it, that that is so rewarding.
[00:33:07]
Pietro Canestrelli
The IRS and other taxing agencies, they just don't care. That's not their function. And it's nice that, you know, we practice law was passion and compassion, educating and advocating for our tax clients every day. And that is such a rewarding thing in and of itself. And and just helping people.
[00:33:29]
Pietro Canestrelli
One of the stories from my book is,
[00:33:32]
Pietro Canestrelli
that kind of highlights what goes on at the IRS is the
[00:33:36]
Pietro Canestrelli
head of our division.
[00:33:37]
Pietro Canestrelli
One time,
[00:33:38]
Pietro Canestrelli
he needed a new secretary, so they picked the secretary with seniority. And this Sally, miss Sally was 80 years old. She's sweetest lady, but she really had no desire to actually work.
[00:33:55]
Pietro Canestrelli
And nobody thought that was a problem. Now she just kind of sat at the desk, and they had to bring in another secretary from one of the the the branches to do her work while she read her Harlequin romances all day.
[00:34:13]
Pietro Canestrelli
And nobody thought that was the least bit weird. Or what can we do? You know, they they figured out a workaround and everybody was happy. And Sally got her paycheck every two weeks and and it was like to me that, you know, as business as a business owner now for ten years, it's like, that is so insane that they're willing to to do that.
[00:34:39]
Pietro Canestrelli
But that that's government. Yeah, that's government.
[00:34:43]
Craig Andrews
Well, this has been really fascinating. And I feel like we could talk for hours.
[00:34:47]
Craig Andrews
Yeah. Yeah. So how can people reach you?
[00:34:50]
Pietro Canestrelli
Yeah. So I have a website,
[00:34:52]
Pietro Canestrelli
and tax attorney.com I e Inland Empire. That's the part of California I'm at. I'm at. And then my book is available on Amazon. Just search America's tax defender or my name and you will find it.
[00:35:10]
Craig Andrews
All right. Well, thanks for coming.
[00:35:11]
Craig Andrews
Leaders and legacies.
[00:35:12]
Pietro Canestrelli
Well, thank you for having me.
[00:35:21]
Craig Andrews
This is Craig Andrews. I want to thank you for listening to the Leaders and Legacies podcast. We're looking for leaders to share how they're making the impact beyond themselves. If that's you, please go to Ally's for me.com/guest and sign up there. If you got something out of this interview, we would love you to share this
[00:35:43]
Craig Andrews
episode on social media.
[00:35:45]
Craig Andrews
Just do a quick screenshot with your phone and text it to a friend, or posted on the socials. If you know someone who would be a great guest. Tag them on social media and let them know about the show, including the hashtag leaders and legacies. I love seeing your posts and suggestions. We are regularly putting out new episodes and content to make sure you don't miss anything.
[00:36:08]
Craig Andrews
Please go ahead and subscribe. Your thumbs up. Ratings and reviews go a long way to help promote the show. It means a lot to me.
[00:36:16]
Craig Andrews
It means a lot to my team. If you want to know more, please go to Ally's for me.com. Or follow me on LinkedIn. Thanks for listening. We'll see you next time.
Resources Mentioned
- Law Office of Pietro Canestrelli
- Pietro Canestrelli on LinkedIn
- America's Tax Defender (book on Amazon)
