The IRS issued updated rules for substantiating the amount of ordinary and necessary business expenses paid or incurred while traveling using the per-diem rates.
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TOPICS / TAX
Individual income taxation
Use of standard mileage rate, other rules are updated for TCJA
The IRS updated its rules concerning the use of standard mileage rates and to reflect the current suspension of miscellaneous itemized deductions and moving expense deductions.
Like-kind exchanges and personal property
A recent law change invites new strategies.
Alimony tax gap swells to $3.2 billion, TIGTA finds
The difference resulted in $248 million of tax underreporting.
Taxpayers may deduct casualty losses in prior years
The IRS finalized regulations permitting taxpayers to deduct disaster losses in the prior tax year and removed the related temporary regulations that were issued in 2016.
IRS clarifies the tax treatment of cryptocurrency ‘hard forks’ and ‘airdrops’
The IRS ruled that a taxpayer does not have gross income as a result of a hard fork of a cryptocurrency if the taxpayer does not receive units of a new cryptocurrency, but does have gross income as a result of an airdrop of new cryptocurrency after a hard fork if the taxpayer receives units of the new cryptocurrency.
Purported family loans were not bona fide, Tax Court holds
The bank deposit method supports an IRS underpayment assessment.
IRS issues 2019 to 2020 per-diem rates for traveling away from home
The IRS issued its annual notice specifying the special per-diem rates, including the transportation industry meal and incidental expenses rates, the rate for the incidental-expenses-only deduction, and the rates and list of high-cost localities for purposes of the high-low substantiation method.
Safe harbor allows QBI deduction for rental real estate businesses
The IRS issued a revenue procedure describing the requirements taxpayers have to meet to be a rental real estate business that qualifies for the safe harbor to be treated as a trade or business in order to qualify for the Sec. 199A qualified business income deduction.
Final regs. loosen 401(k) hardship distribution requirements
The IRS issued final regulations governing hardship distributions from Sec. 401(k) plans, eliminating the requirements that participants obtain a loan from the plan if available and that suspend participants’ ability to make contributions to the plans for six months after taking a hardship distribution.
IRS offers expatriate tax relief
The IRS announced procedures to allow certain individuals who have renounced their U.S. citizenship to get into compliance with their US tax obligations and obtain relief for back taxes.
Taxpayer allowed a deduction under claim of right
A divorced spouse could deduct her indirect repayment of an amount previously included in her and her former husband’s jointly reported income.
Child dependency claims by noncustodial parents
Practitioners can help taxpayers avoid common miscues under the special rule of Sec. 152(e).
Proposed regs. govern maximum automobile values
The IRS issued proposed rules that provide maximum automobile values for the cents-per-mile and fleet-average valuation rules used to determine the amount to include in an employee’s gross income for personal use of an employer-provided vehicle.
Alimony tax gap swells to $3.2 billion, TIGTA finds
Discrepancies between the amount of alimony deducted by payers and reported as income by its recipients increased by 38% in six years, the Treasury Inspector General for Tax Administration reported.
The QBI deduction for rental real estate activity
Optimal treatment under Sec. 199A eludes any one-size-fits-all solution.
Broadened definition of Sec. 152 dependents
The Tax Cuts and Jobs Act of 2017 greatly increased the availability of the child tax credit. Find out the definition of dependent for those purposes and for taking advantage of “surviving spouse” status.
Casualty loss deduction from drug-induced gambling is disallowed
The Tax Court declines to expand ‘other casualty’ beyond one sustained with respect to tangible property.
‘Parsonage’ exclusion ruled constitutional
Reversing a district court, the Seventh Circuit upholds the Sec. 107 housing exclusion for ‘ministers of the gospel.’
IRS changes maximum-vehicle-value rule
The IRS revised its maximum-vehicle-value rule for personal use of an employer-provided vehicle for 2019 for both the cents-per-mile rule and the fleet-average-valuation rule.
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