Posts from: Business News, Tax News
Startup costs: Book vs. tax treatment
New businesses, which are vital to a healthy economy, usually incur costs before they begin active conduct of their intended business operations. These costs are frequently generically referred to as startup costs of a business. For financial accounting... (more...)
Make these last-minute moves to qualify for important retirement savings tax breaks
The end of the year has a variety of retirement planning deadlines you need to meet in order to qualify for tax deductions and credits. Retirees also need to take action by specific dates to avoid retirement account penalties. Here are some of the retirement... (more...)
Federal Tax Day – year 2016 Inflation Adjustments for Pension Plans, Retirement Accounts Released.
The 2016 cost-of-living adjustments (COLAs) that affect pension plan dollar limitations and other retirement-related provisions have been released by the IRS. In general, many of the pension plan limitations will change for 2016 because the increase in... (more...)
IRS eyes payroll tax avoidance tactics via S corporations
Payroll tax collection continues to vex the Internal Revenue Service despite several court cases that have resulted in rulings favorable for the IRS regarding unreasonably low compensation. A recent high profile case was David E. Watson, P.C. v. United... (more...)
IRS finds widespread noncompliance by colleges and universities
The IRS published its final report concerning its Colleges and Universities Compliance Project, finding compliance issues related to unrelated business taxable income (UBTI) and compensation practices. The IRS conducted the study to find out why colleges... (more...)
IRS offers new method for home office deductions
Working at home has come a long way from the days when employers were most concerned that they would not get their money’s worth if they allowed employees to do so. Instant communication, improved internet access, and more stable virtual network connections... (more...)
Form 1099-K
Information reporting for payment card and third party network transactions on Form 1099-K, Payment Card and Third Party Network Transactions is due to the IRS on the last day of February of the year following the transactions. If filing electronically,... (more...)
California—Corporate Income Tax: Timely Filed by Suspended
Corporation that filed notices of appeal while its corporate powers were suspended for nonpayment of its California corporation franchise taxes could proceed with the appeals after those powers were revived, even if the revival occurred after the time... (more...)
All 2012 tax returns can now be filed with IRS
The IRS on Monday announced that it finished updating its processing systems and is now accepting all returns that include the 29 forms that were delayed by the late passage of the American Taxpayer Relief Act of 2012, P.L. 112-240. On Sunday, the IRS... (more...)
Nevada Corporate Income Tax
A California superior court has issued a temporary and proposed statement of decision holding that a Nevada corporation was entitled to a refund of California corporation franchise taxes paid for the tax years in question because the corporation met its... (more...)
California—Personal Income Tax: Supplemental Documentation Did Not Substantiate Claimed Deduction Amounts.
Supplemental documentation provided by taxpayers regarding their claimed California personal income tax deductions for ordinary and necessary expenses paid or incurred in carrying on a trade or business was not sufficient to overcome the presumption that... (more...)
Corporate Income Tax: Nexus Established Due to Employee’s In-State Activities
The FTB advises a taxpayer that its corporate subsidiary, which had a single employee located in California, was doing business in the state during pre-2011 tax years and therefore was subject to corporation franchise and income taxes during those years... (more...)
California—Personal Income Tax: FTB Contacting Nonfilers
The California Franchise Tax Board (FTB) is contacting more than 1 million people who did not file a 2011 state income tax return. The deadline to file was October 15, 2012. The FTB compares its records of filed tax returns with the more than 400 million... (more...)
Rental real estate offers tremendous tax advantages
Rental real estate offers tremendous tax advantages and opportunity for tax planning. Taxpayers, such as you, can depreciate property far exceeding your actual investment, deduct interest on borrowed capital, exchange rather than sell properties to defer... (more...)
Tax-Free IRA Distributions
The American Taxpayer Relief Act of 2012 (2012 Taxpayer Relief Act) extends through 2013 the provision which allows individuals who are at least 70½ by the end of the year to exclude from gross income qualified charitable distributions up to $100,000... (more...)
2012 Resolves Many Uncertainties
2012 Resolves Many Uncertainties, Creates Others; Sets Stage For Future Tax Reform. Uncertainty during 2012 over what tax laws would govern in 2013 and beyond because of the expiring Bush-era tax cuts clearly was the most significant development of the... (more...)
3.8 Percent Medicare Tax on Investment Income
The health care reform package (the Patient Protection and Affordable Care Act and the Health Care and education Reconciliation Act of 2010) imposes a new 3.8 percent Medicare contribution tax on the investment income of higher-income individuals. Although... (more...)
2012 Year-End Tax Planning for Businesses
In recent years, end-of-the-year tax planning for businesses has been complicated by uncertainty over the future availability of many tax incentives. This year is no different. In 2010, Congress extended many business tax incentives for one or two years.... (more...)
Taxpayers who did not establish insolvency must recognize COD income
Taxpayers who settled a credit card debt for $4,412 less than they owed in 2008 had to include that amount in income because they did not prove they were insolvent under Sec. 108(a)(1)(B) at the time of the debt discharge (Shepherd, T.C. Memo. 2012-212).... (more...)
Self-employed can deduct Medicare premiums
Explaining a recent reversal of a long-held IRS stance, the Office of Chief Counsel advised IRS attorneys on Friday that self-employed individuals may deduct Medicare premiums from their self-employment income. Chief Counsel Advice (CCA) 201228037 clarifies... (more...)
Married Taxpayer Filing Separately Not Entitled to Full Deduction
Married Taxpayer Filing Separately Not Entitled to Full Deduction of $1.1 Million for Mortgage Interest. A taxpayer who elects married filing separately is limited to a deduction for interest paid on $500,000 of home-acquisition indebtedness plus interest... (more...)
California—Corporate and Personal Income Taxes
California—Corporate, Personal Income Taxes: Enhanced Electronic Installment Agreement Application Announced,(Jul. 17, 2012). The Franchise Tax Board (FTB) has enhanced its electronic installment agreement (eIA) application to pay outstanding California... (more...)
Business and Tax News
President Signs Highway/Student Loan Bill (Jul. 9, 2012). President Obama on July 6 signed the Moving Ahead for Progress in the 21st Century Act (MAP-21) (HR 4348 ), which raises $20.4 billion in revenue and reauthorizes the fuel and ticket excise taxes... (more...)