The ringing in of the new year at midnight on Dec. 31 also signaled the expiration of several tax provisions. The biggest was the estate and generation-skipping tax regime, which is repealed for 2010. Various bills have been introduced that would revive the estate tax in its 2009 form, but
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Tax Season Kicks Off
Following a flurry of tax legislation that enacted changes for tax years beginning in 2009, this tax season requires heightened attention to make sure your clients don’t miss any of the new and extended deductions and credits to which they’re entitled. Most of the changes for 2009 were directed at
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SINGLE-EMPLOYER DEFINED BENEFIT PLANS GET GUIDANCE The IRS issued final regulations to provide guidance on funding requirements affecting single-employer defined benefit pension plan sponsors, administrators, participants and beneficiaries. The regulations in TD 9467 concern (1) the determination of the value of plan assets and benefit liabilities for purposes of the
Mark J. Hamlin, CPA, PC
Back row, from left: Sindy Pfaab, Tina James and Sissie Kipp. Front row, from left: Jena Bippert, Mark Hamlin and Peggy Piletere. A successful business doesn’t happen through wishful thinking. It takes a lot of hard work to make your dream come true. I always knew I wanted to own
Post-Mortem Tax Lien Is Valid
The IRS may recover a 100% IRC § 6672 trust fund penalty from any responsible person who acts willfully in failing to pay over to the government taxes withheld from employees. If the responsible person dies after the assessment but before the penalty is paid, the Tax Court held, a
Family Partnership Rules Applied in TIFD III-E Remand
In a case reversed and remanded by the Second Circuit, the U.S. District Court in Connecticut again held that a General Electric subsidiary could treat Dutch banks’ interests as partnership equity rather than debt. In so doing, the district court in the long-running TIFD III-E case again sided with the
Series LLCs: Pros and Cons of a Growing Trend
Eight states allow the formation of series LLCs (Delaware, Illinois, Iowa, Nevada, Oklahoma, Tennessee, Texas and Utah). A series LLC consists of a “master” LLC with one or more series of members, managers, interests or assets. Although contained within the master LLC, each series can have separate rights, powers and
Applying for a Private Letter Ruling
When a transaction requires greater certainty or when relief is sought for a difficult tax situation, applying to the IRS for a private letter ruling (PLR) can provide interpretation and application of law and regulation with respect to that taxpayer the Service will follow, within certain conditions and limitations. Here’s
Roth IRA an Ineligible S Corp Shareholder
The Tax Court decided 11–4 that an S election was automatically terminated because the corporation’s sole shareholder was a Roth IRA. The case was said to be a test case for a number of similar ones before the court. Taproot Administrative Services Inc., a Nevada corporation, was fully owned by
Waiving the 60-Day IRA Rollover Rule
Onerous consequences can result when taxpayers fail to follow through with an IRA tax-free rollover. Generally, the entire amount distributed from an IRA or other qualified trust or eligible retirement plan must be deposited in another such account within 60 days. Otherwise, it is included in the taxpayer’s gross income
Credit Card Fees Are OID
The Tax Court held that credit card “interchange” fees received by subsidiaries of credit card issuer Capital One resembled interest that increased or created original issue discount (OID) related to the company’s pool of credit card receivables. As OID, a daily amount was properly included in income over the life
LILO Stands Up to Court Scrutiny
In a rare setback for the IRS in its litigation against lease-in, lease-out (LILO) tax shelters, the Court of Federal Claims held that an arrangement by Consolidated Edison Co. of New York (Con Ed) with an electric utility in the Netherlands should be respected for federal tax purposes because it
2010: The Year of the Roth Conversion?
This year will be the Year of the Tiger, according to Chinese custom, but it also could be remembered by investors as the Year of the Roth Conversion, a decision that can have a large impact on investors’ ability to build wealth during their lifetime and preserve wealth for beneficiaries.
IRS Issues Regulations on Disclosure of Tax Return Information
On Tuesday, the IRS issued temporary and proposed regulations under IRC § 7216 that increase the circumstances in which tax return preparers can disclose or use certain limited tax return information (TD 9478 and REG-131028-09). The temporary regulations amend final regulations that were issued in 2008 and were effective Jan.
IRS Provides Guidance on Return Preparer Liability Under IRC Section 7216
On Wednesday, the IRS issued two revenue rulings (Rev. Ruls. 2010-4 and 2010-5) that provide guidance to tax return preparers on situations in which they will not be liable for civil or criminal penalties under IRC § 7216 for disclosing or using tax return information. IRC § 7216 prohibits a
Tax Court Accepts IRS Method for Determining Gambling Wins and Losses
The Tax Court held in a memorandum decision released Monday that taxpayers who were casual gamblers recognized wins or losses when they redeemed their tokens and that they could not net their wins and losses across the year (Shollenberger, TC Memo 2009-306). In this decision, the court accepted the IRS’
IRS Extends Moratorium on Tax Shelter Enforcement
IRS Commissioner Doug Shulman announced in a letter to Sen. Chuck Grassley, R-Iowa, that the IRS is extending until March 1, 2010, a moratorium on collection enforcement of the IRC § 6707A penalty for failure to disclose tax shelters and other reportable transactions. Shulman first announced the moratorium July 6
Regulations Proposed on Basis Reporting by Brokers
The IRS issued proposed regulations (REG-101896-09) on Wednesday relating to how securities brokers report sales to the IRS and how stock basis is determined. The regulations project also proposes to set a Feb. 15 deadline for brokers to supply certain information statements. The proposed rules reflect changes made in 2008
House Passes Financial Regulatory Reform Bill
House lawmakers voted Friday to approve The Wall Street Reform and Consumer Protection Act, a series of financial regulatory measures. The AICPA advocated for the profession on several provisions in the bill. The bill gives the PCAOB authority to inspect and regulate audits of all broker-dealers. It gives the PCAOB
Deadline for Retirement Plan Amendments to Conform to Recent Laws Extended
The IRS has extended by one year the deadline for retirement plans to make amendments required by the Pension Protection Act (PPA) and last year’s Worker, Retiree, and Employer Recovery Act (WRERA) (Notice 2009-97). The deadline is extended to the last day of the first plan year that begins on
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