Line items

Cost of internet domain names used in business must be capitalized

In Chief Counsel Advice (CCA) 201543014, the Office of Chief Counsel concluded that an internet domain name in the secondary market acquired for use in a taxpayer's trade or business is an intangible asset that must be capitalized under Regs. Sec. 1.263(a)-4. A generic domain name may be a customer-based intangible under Regs. Sec. 1.197-2(b)(6), and thus its capitalized cost may be amortized under Sec. 197 if the taxpayer acquired it to generate advertising revenue by selling space on its website or to increase its market share by providing goods or services through the website. A nongeneric domain name may similarly be a customer-based intangible or, if registered or functioning as a trademark, amortized under Regs. Sec. 1.197-2(b)(10).


OECD proposes rules to reduce global tax avoidance

The Organisation for Economic Co-operation and Development (OECD) in October issued its long-awaited package of proposals to reduce base erosion and profit shifting and harmonize global tax rules. The project is designed to eliminate gaps in existing rules that allow companies to shift their corporate profits to low-tax jurisdictions where little or no economic activity takes place. The OECD estimates that governments lose between $100 billion and $240 billion in tax revenue annually through such corporate tax-avoidance techniques.


TIGTA: Some PTIN holders noncompliant or unsuitable

Although it stated it would require preparers to pass a check of compliance with their own tax obligations to obtain a preparer tax identification number (PTIN) (see Notice 2011-6), the IRS in January 2015 identified 19,496 PTIN holders who potentially were not in compliance with their obligations, the Treasury Inspector General for Tax Administration (TIGTA) reported (Rep't No. 2015-40-075). Of those, more than 3,000 had failed to file required returns for one or more tax years, and eight had failed to file returns for five years. Similarly, although the IRS has said it would check applicants' suitability by asking questions such as whether they have been convicted of a felony in the previous 10 years (see News Release IR-2011-96), more than 3,000 PTIN holders had self-reported a felony conviction on their application, 87 of them reporting a conviction involving federal tax matters.


Year-end tax planning and what’s new for 2016

Practitioners need to consider several tax planning opportunities to review with their clients before the end of the year. This report offers strategies for individuals and businesses, as well as recent federal tax law changes affecting this year’s tax returns.


News quiz: Retirement planning, tax practice, and fraud risk

Recent reports focused on a survey that gauges the worries about retirement among CPA financial planners’ clients, a suit that affects tax practitioners, and a guide that offers advice on fraud risk. See how much you know with this short quiz.


Bolster your data defenses

As you weather the dog days of summer, it’s a good time to make sure your cybersecurity structure can stand up to the heat of external and internal threats. Here are six steps to help shore up your systems.