President Barack Obama released his proposed FY 2014 budget on Wednesday. In it, he aims to raise approximately $580 billion in revenue through new taxes, limits on deductions, and other tax proposals. The revenue-raising portion of the proposed budget generally mirrors the president’s proposals made during the fiscal cliff negotiations
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TOPICS / TAX
Individual income taxation
Survey shows how Americans plan to use tax refunds this year
Americans have some decidedly unsexy plans for their tax refunds this year. Forget about impulse buys or impromptu holidays. These days, taxpayers expect to use the money for the basics: savings, day-to-day expenses, and paying down debt. A new survey conducted for the AICPA by Harris Interactive found that 46%
Appeals court reverses $2.6 million penalty against tax shelter promoter
The Fourth Circuit Court of Appeals reversed and remanded a district court decision because the lower court permitted the jury to hear evidence of a taxpayer’s failure to file his personal income tax returns and to pay his taxes as evidence of his bad acts in determining whether he should
Individual health care mandate rules proposed
The IRS released proposed rules for 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 (the controversial “individual mandate”) (REG-148500-12). Separately, the IRS also issued final regulations defining affordable coverage for purposes of the premium
Release of dependency exemption trumps child support
In two recent cases, the Tax Court ruled on the validity of a dependency exemption release to a noncustodial parent. Taken together, the cases illustrate how a properly executed and filed Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent, is the key to releasing
Identity theft, phishing top IRS’s “Dirty Dozen” tax scams
The IRS issued its “Dirty Dozen” list of tax scams Tuesday, highlighting fraudulent schemes commonly committed by and upon taxpayers. The annual warning, released to coincide with tax filing season, emphasizes the most egregious schemes involving filing false returns or return items, but it also advises yearlong vigilance against practices
Taxpayers filing delayed forms get late-payment penalty relief
On Wednesday, the IRS announced that it will waive the penalty normally assessed for late payment of income tax, for taxpayers who have requested an extension of time to file their return and who are filing one of the 31 forms that were delayed until March because of the last-minute
Tax filing resources—Tax year 2012
This is the one-stop shop for all the updates you need to know for this year’s tax filing season. Find resources from the Journal of Accountancy, plus tax return checklists and tax savings tips from the AICPA, categorized by tax topic. INDIVIDUAL TAX All 2012 tax returns can now be
Tax reform prospects good, say veterans of 1986 reform
Developments since the 1986 Tax Reform Act was signed favor a successful outcome for the current reform effort, said two experts who worked for congressional committees producing the earlier legislation. But they also agreed that a tax reform bill probably won’t be enacted until next year. Don Longano and Mel
Flight attendant cannot claim foreign earned income exclusion for wages earned in international airspace and U.S.
On Wednesday, the Tax Court held that a flight attendant who was a resident of Hong Kong and a U.S. citizen could not claim 100% of her wages were excludable under the Sec. 911 foreign earned income exclusion (Rogers, T.C. Memo. 2013-77). The court also upheld an accuracy-related penalty under
Sequestration will lead to IRS cuts in services, enforcement, and tax-related payments
Now that sequestration has taken effect, the IRS has announced the following reductions in tax-related payments as a result of the Budget Control Act of 2011, P.L. 112-25. These reductions are effective beginning on March 1, 2013, until either the end of the government’s fiscal year (Sept. 30, 2013) or
Donating and sharing paid time off
Hurricane Sandy highlighted the role of programs that allow employees to donate the value of their unused paid time off (PTO) from work or share it with fellow employees. Following are the main types of programs and their tax treatment. Standard PTO Charitable Donation Programs In this type of program,
Stockpiled delayed returns to be accepted on Sunday, online filing to start next week
Late Wednesday, the IRS announced that it will begin accepting from e-file transmitters stockpiled returns containing the 29 forms for which acceptance was delayed beginning on Sunday, March 3, at 7 a.m. ET (Quick Alerts for Tax Professionals (2/27/13)). E-file transmitters have been holding returns submitted with the delayed forms
2013 automobile depreciation limits released
The IRS on Monday issued the 2013 inflation adjustments to the depreciation limitations and lease inclusion amounts for certain automobiles under Sec. 280F (Rev. Proc. 2013-21). For passenger automobiles (other than trucks or vans) placed in service during calendar year 2013 to which 50% first-year bonus depreciation applies, the depreciation
AICPA raises concerns about delayed, compressed tax season
Jeffrey Porter, chair of the AICPA’s Tax Executive Committee, sent a letter to Steven Miller, acting commissioner of the IRS, on Friday raising concerns about the “very compressed and difficult filing season” AICPA members and their clients are facing, due to the ongoing delays in the IRS’s acceptance of certain
Depreciation and education credit forms can soon be filed with the IRS
The IRS announced on Friday that it will soon be able to accept tax returns that include Form 4562, Depreciation and Amortization, and/or Form 8863, Education Credits (IR-2013-18). The IRS will start processing returns with Form 4562 on Sunday, Feb. 10, and will start processing returns with Form 8863 on
Court upholds injunction; IRS reopens PTIN system
The IRS announced on its Return Preparer Office Facebook page on Saturday that it has reopened its preparer tax identification number (PTIN) system for new applications and renewals. The announcement follows a clarification from the district court that struck down the IRS’s return preparer registration program, saying that the injunction
Don’t neglect to elect, part 4
As a fourth installment in an occasional series, here are additional tax elections for estates, partnerships, and individuals. ESTATES Election to treat a revocable trust as part of an estate. Sec. 645 allows for an election to treat a qualified revocable trust (QRT) as part of a decedent’s estate for
Tax cliff averted
Pulling back from the “fiscal cliff” at the 13th hour, Congress on New Year’s Day preserved most of the George W. Bush-era tax cuts and extended many other lapsed tax provisions. The new law brings a multitude of changes affecting both 2012 returns and, for the new year, tax planning,
Stopping tax identity theft: Practical advice for CPAs and clients
Tax return and other tax-related identity theft is a growing problem that CPAs can help their clients with—both in taking preventive actions and in correcting problems after an identity thief has struck. Tax return identity theft occurs when someone uses a taxpayer’s personal information, such as name and Social Security
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SPONSORED REPORT
Preparing clients for new provisions next tax season
As the 2025 filing season approaches, H.R. 1 introduces significant tax reforms that CPAs must be prepared to navigate. These legislative changes represent some of the most comprehensive tax updates in recent years, affecting both individual and corporate taxpayers. This report provides in-depth analysis and guidance on H.R. 1.
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