IRS practice & procedure

TOPICS / TAX

November 1, 2000

Tip Compliance Programs Widened

TAX NEWS The IRS expanded its voluntary tip compliance programs from the food and beverage, gaming and hairstyling industries to all those in which tipping is customary (announcements 2000-19 and 2000-23; notice 2000-21). In exchange for an employer’s or employee’s participation, the IRS agrees to refrain from tip examination. Employers

November 1, 2000

Is a Contingent Attorney’s Fee Includible in Plaintiff’s Income?

gnes, a 64-year-old resident of California, successfully sued her ex-employer in 2000 for wrongful termination; a jury awarded her $2 million. Agnes paid her attorney $800,000, 40% of the award, in accordance with their contingent fee agreement; thus, her net proceeds from the suit were $1.2 million. In March

November 1, 2000

Expensing Corporate Activities

TAX CASE One of the most difficult questions a company faces is whether it must capitalize an expenditure or whether it can deduct it. Minor variations in the facts can greatly affect the answer to the question. American Stores Co., a corporation that filed consolidated tax returns, owned and operated

November 1, 2000

Last Known Address Program Delayed

TAX NEWS Last year the IRS announced that, effective May 1, 2000, a new program would allow it to update taxpayers’ addresses using the U.S. Postal Service’s national change of address (NCOA) database. Previously a taxpayer’s “last known address,” although not defined by statute or regulation, had been determined by

November 1, 2000

Donating Excess Inventory to Charity

TAX NEWS CPAs may want to remind clients with excess inventory that they can earn a federal tax deduction when the product is donated to charity. Corporations with a fiscal year ending December 31 should be urged to check their inventory levels now. Clients that have difficulty finding an organization

September 1, 2000

Auditing 2

The Big Five accounting firms agreed to participate in an SEC-sponsored retrospective review program. Under the agreement, the firms will report certain instances, during a specific period, in which they did not adhere to the new proposed independence rules limiting financial interests in audit clients by firms, auditors and some

September 1, 2000

Valuing Closely Held Stock for Estate and Gift Tax Purposes

PAs who work with estates know that, if a decedent owned stock of a closely held business at his or her death, the value of the stock generally must be determined if an estate tax return will be filed. The value for such purposes is the date-of-death fair market value

March 1, 2000

Public Disclosure Requirements for Public Charities

lthough many public charities, as exempt organizations, technically have been subject to public disclosure requirements for a long time, Congress recently changed the law to make this information much more accessible to the public. An exempt entity must disclose and make available two sets of documents: Its exemption applications, all

July 1, 1999

What a PEO Can Do for You

EXECUTIVE SUMMARY MORE THAN EVER BEFORE, BOTTOM-LINE-CONSCIOUS companies are outsourcing HR functions by making use of professional employer organizations. PEOs perform a wide variety of tasks ranging from payroll management and employee benefit design and administration to tax filings and compliance with state and federal workplace legislation. GIVEN THE MYRIAD

June 1, 1998

The banking industry is taking action to reduce year 2000 problems associated with …

Checking Vendors for Y2K Compliance The banking industry, which has taken action to reduce its own year 2000 (Y2K) risks, now requires its vendors to do the same. Bank regulatory agencies issued guidance on how banks can ensure that service providers and software vendors are prepared for computer-related problems or

May 1, 1998

Surviving An Employment Tax Audit

In recent years the IRS has examined closely the status of workers classified as independent contractors and whether they should instead be considered employees. The results of these examinations: Hundreds of thousands of workers were reclassified as employees and their employers were assessed hundreds of millions of additional tax dollars

April 1, 1998

Derivatives: Time to Take Sides

In the classic Japanese film Seven Samurai , seven soldiers defend a village against a much larger force and refuse to back down. As large businesses, banks, Fed chairman Alan Greenspan and both houses of Congress continue to take ever-stronger steps to limit the power of the FASB, its seven

April 1, 1997

What to expect

What to expect from the IRS this year. From The Tax Adviser: Examining the 1997 Examination Program T he Internal Revenue Service, like most other government agencies, has to tighten its budget while trying to achieve more goals and objectives. CPAs and their taxpayer clients can get an idea of

FROM THIS MONTH'S ISSUE

4 ways solo practitioners can stand out

Five years ago, a grieving Angel Zhen started his own CPA firm with no clients and no revenue. Today, he has 300 clients, $600,000 in revenue and 12 weeks of annual vacation. In this JofA article, he shares how he set up his firm and how you could do the same.