The AICPA has released revised Statements on Standards for Tax Services (SSTS), whichbecome effective Jan. 1, 2010. The SSTS are enforceable standards of tax practice for AICPA members that address each member’s obligations regarding the following issues: The level of authority needed to recommend a tax return position or
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IRS Issues 2010 Mileage Rates
The IRS announced Thursday (Revenue Procedure 2009-54) the standard mileage rates for computing deductible costs of operating an automobile that are paid or incurred on or after Jan. 1, 2010. For business use of an automobile, the rate is 50 cents a mile. For medical or moving expenses, it is
2009 Tax Software Survey
The JofA and The Tax Adviser conducted a survey of their readers to determine what aspects of their tax preparation software they like and what they dislike. The survey, which received 9,776 responses, was carried out in late June and early July 2009. Of the 13 products identified for the
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IRS ISSUES REGS ON SIX-YEAR LIMITATIONS ON BASIS OVERSTATEMENT The IRS issued proposed and temporary regulations (TD 9466, REG-108045-08) Sept. 24 to clarify that an overstatement of basis can create a substantial omission of gross income under IRC §§ 6229(c)(2) and 6501(e) for purposes of the six-year extended period for
When a Tax Return Is Not a “Return”
A taxpayer who does not comply with IRC § 6020(a) when filing late tax returns could lose the benefit of a bankruptcy discharge of taxes due on those returns. CPAs must be wary of this 2005 amendment to the Bankruptcy Code (USC Title 11) if a client has a history
A Limited-Time Opportunity for Small Business Stock
The American Recovery and Reinvestment Act of 2009 (ARRA) increased the exclusion amount for qualified small business stock (QSBS) from 50% to 75% (IRC § 1202). In addition, QSBS is currently subject to a lower inclusion rate for gains subject to the alternative minimum tax (AMT) under section 57(a)(7). However,
Underlying Assets Not Gift Tax Value of Interest in N.Y. LLC
In a taxpayer-friendly ruling, the Tax Court has held that a transfer of interest in a single-member limited liability company (LLC) should be valued for gift tax purposes as a transfer of an interest in the LLC rather than a transfer of its underlying assets. In 2000, Suzanne Pierre organized
IRS Expands Electronic Payment Options
With tax season about to start, practitioners should be aware of the various electronic payment options the IRS has introduced in recent years. EFTPS The IRS’ free Electronic Federal Tax Payment System (EFTPS) allows businesses and individuals to pay federal taxes via the Internet or over the phone. Tax payments
An Update on Accounting for Uncertainty in Income Taxes
Preparers of private company and not-for-profit organization financial statements will have to implement provisions of Topic 740 of the FASB Accounting Standards Codification (ASC) relating to accounting for uncertainty in income taxes (formerly FASB Interpretation no. 48, commonly known as FIN 48) for annual financial statements for periods beginning after
Requests for Tax Shelter Opinion Letters Denied
The Tax Court denied a partnership’s motions to compel the IRS to provide tax opinion letters related to all known “Son of BOSS” transactions, along with a list of law or accounting firms that have issued them. The court determined that the information requested by 3K Investments LLC (tax matters
Two Easements, Two Outcomes
The Tax Court decided two cases involving conservation easements with mixed results for the taxpayers. In one case, the court held that the taxpayer was entitled to a charitable deduction for easements on two properties, since the easements were exclusively for conservation purposes. According to the court, the easements preserved
Final Regulations Update Rules on Paying Tax in Installments
The IRS issued final regulations Tuesday governing the payment of tax liabilities in installments (TD 9473). The regulations reflect changes to the law made by various acts going as far back as 1996. IRC § 6159 allows taxpayers who cannot pay their tax liabilities in full an option to enter
IRS Releases Guidance on Expanded NOL Carryback Rules
The IRS on Friday provided guidance on the new expanded five-year net operating loss (NOL) carryback rules, which were recently amended by the Worker, Homeownership, and Business Assistance Act, PL 111-92. The guidance is contained in Revenue Procedure 2009-52, and it explains how a taxpayer elects to carry back an
Tax Court Amends Rules to Allow Electronic Filing
The Tax Court has amended its procedural rules, effective Jan. 1, 2010, to allow electronic filing of documents submitted to the court (Tax Court Rule 26). The court set up a pilot electronic filing program in 2005. In 2008, the court added an electronic document access system to its Web
UBS Targets Come Into Focus
The IRS has released the selection criteria for identifying holders ofaccounts with Swiss bank UBS under a U.S. settlement agreement with the Swiss government negotiated in August. Under the agreement, UBS will turn over information concerning approximately 4,450 accounts for investigation. IRS Commissioner Doug Shulman also recently announced that about
IRS Pilot Program Will Allow Truncated Social Security Numbers on Information Returns
The IRS on Thursday announced a pilot program aimed at deterring identity theft (Notice 2009-93). Under the program, filers of certain paper information returns will be allowed to truncate the payee’s Social Security number on the payee statement. The change affects statements for 2009 and 2010. Only paper payee statements
Economic Optimism Levels Off, Execs Concerned About Government Policies
Optimism among CPA financial executives about the U.S. economy flattened after two quarters of improvement as managers paid more attention to potential challenges and concerns associated with the federal budget deficit, tax reform and regulatory requirements, according to a survey released Monday. Results from the Economic Outlook Survey Q4 2009,
President Signs Military Spouses Residency Relief Act
President Barack Obama signed into law the Military Spouses Residency Relief Act (PL 111-97), which will ensure that the spouses of military personnel who move because their spouse is posted for military duty will be treated as not having changed residency for tax purposes. Under the act, the fact that
President Signs Unemployment Bill With Tax Items
On Friday, President Obama signed into law a bill that includes changes to the first-time homebuyer credit, increased NOL carrybacks for small businesses, and mandatory e-filing for most tax return preparers. The bill cleared Congress on Thursday. The Senate had unanimously agreed to the bill, the Worker, Homeownership, and Business Assistance
Court Negates Tax Planning Transaction
A district court held that a partnership’s reported capital loss stemming from nonperforming loans lacked economic substance and denied the claimed tax benefits. D. Andrew Beal owned a bank that was in the business of acquiring nonproducing loans (NPLs) at extreme discounts. With an associate and China Cinda Asset Management
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