Three Weeks and Counting

The Internal Revenue Service shut down on December 22, 2018. The vast majority of IRS employees turned off their computers, and cellphone and went home. Approximately 10,000 workers (out of over 80,000) were asked to continue working -most without pay- under the “protection of government property” (i.e., your tax dollars) exception. The Department of Treasury […]

Like-kind Exchanges Now Limited to Real Property

The Internal Revenue Service reminded taxpayers that like-kind exchange tax treatment is now generally limited to exchanges of real property. Like-kind exchange treatment now applies only to exchanges of real property that is held for use in a trade or business or for investment. An exchange of real property held primarily for sale still does […]

“Tax Transcript” email scam

The Internal Revenue Service and Security Summit partners today warned the public of a surge of fraudulent emails impersonating the ITS and using tax transcripts as bait to entice users to open documents containing malware. The scam is especially problematic for business whose employees might open the malware because malware can spread throughout the network […]

Treatment of Leave-Based Donation Payments

 The Internal Revenue Service will not assert that cash payments an employer makes to organizations in exchange for vacation, sick, or personal leave that its employees elect to forgo constitute gross income or wages of the employees if the payments are (1) made to the organizations for the relief of victims of Hurricane Michael; (2) […]

Business Owners Can Claim a Qualified Business Income Deduction

Eligible taxpayers may now deduct up to 20% of certain business income from domestic businesses operated as sole proprietorships or through partnerships, S-corporations, trusts, and estates. The deduction may also be claimed on certain dividends. Eligible taxpayers can claim the deduction for the first time on the 2018 federal income tax return they file in […]

The New 20% Deduction for Pass-through Businesses

Section 199A of the Internal Revenue Code provides many taxpayers a deduction for qualified business income. The deduction has two components: Eligible taxpayers may be entitled to a deduction of up to 20% of qualified business income from domestic business operated as a sole proprietor or through a partnership, S corporation, trust or estate. Eligible […]

Proposed regulations on new 20% deduction for passthrough businesses

The IRS issued proposed regulations today for a new provision allowing many owners of sole proprietorships, partnerships, trusts and S corporations to deduct 20 percent of their qualified business income. The new deduction- -Section 199A deduction- – is available for tax years beginning after December 31, 2017. Eligible taxpayers can claim it for the first […]

Tips for Extension Filers

For taxpayers who have not filed: Taxpayers can still e-file returns For taxpayers owed a refund, get it direct deposited Taxpayers who owe taxes should consider using IRS Direct Pay, using a computer or mobile device Members of the military and those serving in a combat zone generally get more time to file. Military members […]

Here’s what taxpayer’s should know about penalty relief

After receiving a notice stating the IRS assessed a penalty, a taxpayer should check that the information in the notice is correct. Those who can resolve the issue may get relief from certain penalties, which include failing to: File a tax return Pay on time Deposit certain taxes as required Types of Penalty Relief: Reasonable […]

IRS offers penalty, filing relief to new transition tax on foreign earnings

Section 965 of the Internal Revenue Code, enacted in December 2017, imposes a transition tax on untaxed foreign earnings of foreign corporations owned by U.S. shareholders by deeming those earning to be repatriated. Foreign earnings held in the form of cash and cash equivalents are taxed at a 15.5 percent rate, and the remaining earnings […]