The IRS and Treasury Department, along with two other federal departments, on Thursday further described planned guidance on provisions for employer-sponsored health coverage mandated by the Patient Protection and Affordable Care Act (PPACA), P.L. 111-148, scheduled to take effect in 2014. Treasury and the IRS issued Notice 2012-17 covering frequently
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Tax
Guidance issued on work opportunity credit for veterans
The IRS issued a notice on Thursday that gives employers guidance on two new tax credits for qualified veterans and provides extra time to comply with some of the credits’ requirements (Notice 2012-13). The Three Percent Withholding Repeal and Job Creation Act, P.L. 112-56, extended the work opportunity tax credit
Proposed FATCA regs. take comprehensive approach to foreign financial institution reporting
The IRS on Wednesday issued proposed regulations providing rules on information reporting by foreign financial institutions (FFIs) and withholding on certain payments to FFIs and other foreign entities (REG-121647-10). Under the Foreign Account Tax Compliance Act of 2009 (FATCA), part of the Hiring Incentives to Restore Employment (HIRE) Act of
TIGTA: Revise Form 1099-R to improve taxpayer compliance
In a report released on Tuesday, the Treasury Inspector General for Tax Administration (TIGTA) recommended the IRS change its Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., to improve taxpayer compliance with reporting and paying tax on this type of income (TIGTA, Opportunities Exist
Couples who filed joint returns must now file separate powers of attorney
Starting March 1, the IRS will no longer accept old versions of Form 2848, Power of Attorney and Declaration of Representative, and will accept only the version released in October 2011. The new version of the form requires a husband and wife who filed a joint tax return to each
IRS, Labor Department proposals aim to increase retirement options and transparency
Federal initiatives designed to broaden options and increase transparency in retirement plans were announced Thursday. The IRS issued proposed regulations that would make it easier for defined benefit pension plans to offer combinations of lifetime income and single-sum cash payments (REG-110980-10). Other proposed regulations released on Thursday would relax the
Prop. regs would ease required minimum distribution rules for older retirees who purchase certain annuities
The IRS issued proposed rules (REG-115809-11) that would permit IRA participants to enter into contracts for annuities that begin at an advanced age (often called longevity annuities), using a certain amount of their account balances without having these amounts count for calculating required minimum distributions from the IRAs under Regs.
Individuals who are eligible for medical services at IHS facilities may still participate in HSAs
The IRS on Wednesday explained that people who are eligible to receive medical services at Indian Health Service (IHS) facilities are not automatically disqualified from making tax-free contributions to health savings accounts (HSAs) (Notice 2012-14). Under Sec. 223(c)(1), an eligible individual for HSA purposes is, for any month, an individual
Help clients choose the right charities
Many nonprofits operate with tight resources, and some are struggling to survive in the slow economy. Here are ways to determine if the charities your clients support are effectively governed, accountable and fiscally responsible. —By Betsy Brill (betsy@stratphilanthropy.com), MBA, founder and president, and Susan Winer (susan@stratphilanthropy.com), senior vice president–Business, both
Grantor retained interests clarified
The IRS issued final regulations providing guidance on the portion of property (held in trust or otherwise) includible in a grantor’s gross estate if the grantor has retained the use of the property or the right to an annuity, unitrust, graduated retained interest or other payment from the property for
Congress repeals 3% withholding, enacts worker credit for veterans
On Nov. 21, President Barack Obama signed into law an act (P.L. 112-56) that repeals a 3% government contractor withholding requirement. The act removes Sec. 3402(t), which required withholding of 3% of payments by the federal or state governments or their instrumentalities or subdivisions (including multistate agencies) to any person
Interest-netting relief allowed to consolidated group member
The Court of Federal Claims ruled that a member of a consolidated group is “the same taxpayer” for purposes of interest-netting relief both before and after becoming a member of the consolidated group. The IRS assessed a tax deficiency of $9,953,525 against Magma Power Co. with respect to its tax
Preparer fingerprinting delayed
The IRS will delay and reconsider its fingerprinting requirement for tax return preparers, IRS Commissioner Doug Shulman told the AICPA National Tax Conference in November. “We have decided to hold off fingerprinting while we consider issues that have been raised and have further discussions with interested parties,” Shulman said during
All in the family
CPAs do their best to keep up to date with tax developments. However, much of their job involves dealing with family dynamics, requiring skills related more to understanding and communication than technical expertise. Three principles should guide practice management when families are involved: – Understand the perspective of each family
Restricted stock awards and taxes: What employees and employers should know
The use of restricted stock awards to compensate employees is growing in popularity in place of the much-maligned stock option. One of the reasons for the shift to restricted stock is the reduced charge against income provided by restricted stock awards as compared to stock option grants. Restricted stock is
Disallowed deduction equals change in accounting method
The Fifth Circuit Court of Appeals upheld a Tax Court decision that a change in accounting method occurred when the IRS disallowed an accrual-basis taxpayer’s deduction for inventory purchased on account from a related-party cash-basis taxpayer. Therefore, the taxpayer was required to include amounts erroneously deducted in closed tax years
First-time homebuyer credit allowed for equitable owner
The Tax Court held that a taxpayer could claim a first-time homebuyer credit for a house he didn’t occupy or hold legal title to during the tax year. The taxpayer bore the benefits and burdens of ownership under state law, making him its equitable owner, and his intention to live
When a client leaves or loses a job
Given the continued weakness in the economy and an unemployment rate still above historic norms, now is a good time to review the financial planning issues clients face when they leave a job or are laid off. A CPA’s timely and proactive advice can have a lasting effect. Here are
The reach of Circular 230
While discussions about Circular 230 usually focus on the standards it imposes relating to tax returns and opinions, the breadth and scope of Circular 230 also affects day-to-day business operations of tax practitioners relating to fees, client solicitations, marketing and advertising, and the management of client files and records. A
Starkman receives Institute’s highest award for tax
Jay Starkman received the 2011 Arthur J. Dixon Memorial Award, the highest award given by the accounting profession in the area of taxation. The annual award, given by the AICPA’s Tax Division, honors Arthur J. Dixon, a CPA known for his outstanding record of service to the tax profession and
Features
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.
From The Tax Adviser
April 30, 2026
Current developments in taxation of individuals: Part 2
April 30, 2026
