Proposed regulations issued by the IRS on Friday answer a number of questions regarding the Sec. 5000A “individual mandate” under 2010’s health care reform legislation, including the definition of those government programs that do not provide minimum essential health care coverage (REG-141036-13). They also provide a hardship exemption for individuals
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TOPICS / TAX
Individual income taxation
District court says premium tax credits are available in federal health care exchanges
In a decision that aids the implementation of a key provision of 2010’s health care reform legislation, the federal district court for the District of Columbia held that the Sec. 36B premium tax credit is available to taxpayers who purchase health insurance through the 34 state health care exchanges that
Engagement letters for the individual tax practitioner
Follow best practices in this crucial document for any tax engagement.
Buckle up for tax season
For taxpayers and their CPA return preparers, now is the time to power their way through filing season, hopefully with a minimum of hassle. Plus: The JofA’s annual Quick Guide, a printable card that contains dollar thresholds, tax tables, standard amounts, credits, and deductions to keep at your fingertips during tax season.
Calculating the health care individual mandate penalty
The shared-responsibility payment by applicable individuals, better known as the “individual mandate” penalty for failure to have qualifying health insurance coverage, was at the heart of the litigation over the Patient Protection and Affordable Care Act of 2010, P.L. 111-148 (PPACA), that culminated in the U.S. Supreme Court’s upholding the
IRS announces automation of taxpayer resources, start of business filing season
The IRS announced on its website that, beginning in 2014, it will stop providing a number of taxpayer assistance services in person or over the phone and will shift those services online. The move is designed to free up IRS employees to help taxpayers deal with issues, such as identity
Guidance issued on tax treatment of National Mortgage Settlement payments
The IRS issued guidance on the correct tax treatment of payments taxpayers receive under the National Mortgage Settlement when their house is foreclosed on (Rev. Rul. 2014-2). The National Mortgage Settlement is an agreement reached in 2012 between the U.S. government and the attorneys general of 49 states and the
IRS reveals start date for 2014 tax filing season
The IRS has finally announced an official start date for the 2014 filing season: It will start accepting returns on Jan. 31. This date is 10 days later than the originally planned starting date of Jan. 21. “The late January opening gives us enough time to get things right with
Standard mileage rates go down slightly in 2014
Optional standard mileage rates for use of a vehicle will go down by one-half cent per mile for 2014, the IRS announced (Notice 2013-80). Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile. For business use of a car, van, pickup truck,
Numerous provisions expire at year end
Taxpayers and practitioners breathed a sigh of relief in January when Congress passed the American Taxpayer Relief Act of 2012 (ATRA), P.L. 112-240, at the last minute, bringing some certainty to a host of provisions that had been uncertain. Many expired and expiring provisions were extended by ATRA, including the
Final and proposed regs. issued on 3.8% net investment income tax
Late on Tuesday, the IRS issued final and proposed regulations giving guidance on the application and computation of the 3.8% net investment income tax imposed by Sec. 1411 (T.D. 9644 and REG-130843-13). The final regulations adopt, with changes, proposed regulations issued late in 2012. Starting in 2013, Sec. 1411 imposes
Tax return preparers suspected of filing inaccurate EITC claims to be targeted by IRS
The IRS announced in an email to tax practitioners that it will send letters in November and December to return preparers “suspected of filing inaccurate EITC [earned income tax credit] claims” (Quick Alerts for Tax Professionals, Nov. 6, 2013). According to the IRS, the letters will explain “critical issues identified
All legal same-sex marriages recognized for tax purposes
In the wake of the Supreme Court’s Windsor decision (Sup. Ct. Dkt. No. 12-307 (6/26/13)), which invalidated a portion of the Defense of Marriage Act (DOMA), P.L. 104-199, the Treasury Department and IRS announced in late August that “same-sex couples, legally married in jurisdictions that recognize their marriages, will be
Final rules issued on individual health care mandate
The IRS released final regulations on the Sec. 5000A shared-responsibility payment—the penalty or tax imposed on individual taxpayers who do not obtain minimum essential health care coverage beginning in 2014 (known as the “individual mandate”). The final rules adopt the proposed regulations issued in January with a few clarifications (REG-148500-12).
Before you sign: Natural gas lease tax issues
The practice of extracting natural gas from shale through hydraulic fracturing, commonly referred to as “fracking,” is becoming more widespread throughout the country. It is essential for practitioners to understand the tax issues that could arise for clients who own property with shale gas deposits. From 2001 to 2011, Americans
Government farm payments subject to SE tax
The Tax Court held a taxpayer’s net income from payments received under the U.S. Department of Agriculture’s Conservation Reserve Program (CRP) was self-employment income under Sec. 1402(a). During 2006 and 2007, Rollin Morehouse, a resident of Minnesota, received “CRP annual rental” payments as consideration for agreeing to set aside from
IRS releases inflation adjustments for 2014
On Thursday, the IRS issued the annual inflation adjustments for 2014 for more than 40 tax provisions and the tax tables for 2014 (Rev. Proc. 2013-35). Among the inflation-adjusted amounts that have increased are the personal exemption, which increased from $3,900 in 2013 to $3,950 for 2014, and the standard
Filing season will be delayed, IRS says
The IRS announced on Tuesday a delay of one or two weeks in the start of the 2014 filing season as a result of the 16-day government shutdown to allow adequate time for the IRS to prepare and test systems. The return filing start date was originally going to be
Final regs. clarify who is subject to 50% limit on meal and entertainment expenses
The IRS issued final regulations clarifying which party is subject to the 50% limit on deductible meal and entertainment expenses under Sec. 274(n) (T.D. 9625). The final rules adopt proposed regulations (REG-101812-07) issued in July 2012 without substantive change. As the IRS emphasized in the preamble to the earlier proposed
IRS updates special per diem rates for 2013–2014 travel expenses
On Wednesday, the IRS issued its annual update of special per diem rates for use in substantiating certain business expenses taxpayers incur when traveling away from home in 2013 and 2014 (Notice 2013-65).The notice provides the transportation industry meal and incidental expenses rates, the rate for the incidental-expenses-only deduction, and
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