October 1999 New liberalized rules. From The Tax Adviser: Innocent Spouse Provisions In 1998, Congress enacted IRC section 6015. The new provisions relax the eligibility requirements for innocent spouse status, eliminating the dollar understatement thresholds and changing the standard to “erroneous” understatements rather than “grossly” erroneous ones; in addition,
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How to Select the Right Accounting Software
EXECUTIVE SUMMARY THE INTERNET IS CHANGING the way businesses do business, and that means business managers must rethink what they expect from their accounting software. Your software should be able to Publish Web catalogs directly from, and make links to, the software’s inventory module, which means customers can see, among
Line Items
Law Fees Not Deductible A corporation paid an annual retainer of $100,000 to a law firm that specializes in corporate takeovers. The corporation thereby obtained the firm’s expertise and precluded the firm from accepting the corporation’s competition as clients. The agreement gave the corporation the right to use the firm
Diversity Is Good for Business
EXECUTIVE SUMMARY MANY COMPANIES AND FIRMS ARE DISCOVERING that staff from different ethnic backgrounds bring valuable perspectives to the table and are effective in working with a wide spectrum of customers and clients. At the same time, businesses are finding that achieving and maintaining diversity is a complex undertaking. FOR
Tax Software Hits the Net
EXECUTIVE SUMMARY THE TAX SOFTWARE INDUSTRY, already buffeted by wrenching consolidations fueled by the swing to Windows, now faces a new technological challenge: the Internet. And as with Windows, either tax software vendors meet the challenge or face possible extinction. STARTING THIS TAX YEAR, at least one vendor, RIA, is
SPECIAL REPORT
Not All Trusts Are Trustworthy There’s something about the word trust that makes people feel secure. In the financial world, however, the use of that word can be deceiving. Each year the IRS investigates fraudulent trust schemes that promise participants they will reduce or eliminate income taxes. In recent years,
From the Tax Adviser
ne of the “hottest” areas in state and local tax practice centers on state audits of businesses for unclaimed property. Most states have laws under which, if property remains unclaimed for a specified time, it is presumed abandoned by its owner and the holder of the property is required to
Library Spotlights Tax History
The newly created Tax History Foundation and Museum opened a library in Northfield, Illinois, dedicated to tax, accounting and business history. It encompasses more than 350 volumes of tax court cases and memorandum decisions and includes secondary sources on taxation and economic history. H. Elliott Lipschultz, executive director and creator
“Planning” for Disability
EXECUTIVE SUMMARY A BUSINESS THAT WANTS TO CONTINUE PAYING WAGES to a key employee in the event of sickness or disability can do so only under an IRC section 105 qualified sick-pay plan (QSPP). If a business doesn’t have such a plan in place, wage payments are not tax deductible
IRS Publishes Top Errors
The IRS recently listed the most common errors professional tax preparers made on returns. The list reflects 1040 form information received by the IRS through May 19, 1999. Taxpayer identification numbers or names for dependents on returns didn’t match the IRS or Social Security (SS) records. (The IRS didn’t allow
Rating Tax Software
EXECUTIVE SUMMARY TAX SOFTWARE PREPARERS continue to be satisfied with the products they used this year, but their fondness has cooled somewhat from last year. CUSTOMER SUPPORT HAS IMPROVED, they report. SOME 83% OF THE USERS said they would continue to use the same package this year; 6% said they
Kick the Habit
At the same time Congress has pressed for antitobacco legislation and settlements against cigarette manufacturers, the IRS has been denying the deductibility of stop-smoking programs. In revenue ruling 79-162 (1979-1 CB 116), the IRS held that a taxpayer who had no specific ailment or disease could not deduct participation in
Eastern Exposure
EXECUTIVE SUMMARY ON SUMBAWA, A REMOTE INDONESIAN ISLAND east of Bali, Newmont Mining Corp. began developing a huge mining project that represented tremendous opportunity as well as political, social and financial risk. Newmont tried to anticipate risk during the 13-year development of Batu Hijau but did not foresee government overthrow,
Tax Case
Loss on Sale to a Commonly Controlled Corporation As a general rule, taxpayers cannot deduct losses on transactions between related parties. IRC section 267(f) provides a special rule for losses between “commonly controlled” corporations. The loss is deferred rather than denied and is recognized based on the consolidated tax return
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Spouse Health Care Deduction The IRS says that self-employed individuals can deduct the cost of accident and health coverage for an employee/spouse and any of that spouse’s dependents. The IRS also allows the spouse to exclude coverage costs and medical reimbursements from his or her gross income. The extent and
From the Tax Adviser
ncentives to attract commercial tenants and the tax ramifications. From The Tax Adviser: Rent Inducements n today’s business environment, prospective tenants of commercial property have many alternatives and options. Given the competition in trying to attract tenants to available space, landlords may need to offer special benefits or favorable lease
Accounting for Sticky Fingers
In the crime of embezzlement, there are tax implications for both the embezzler and the embezzled. Embezzled income is taxable to the person who does the embezzling (revenue ruling 61-185, 1961-2 CB 9; revenue ruling 65-254, 1965-2 CB 50; James v. United States, 366 US 213 (1961), Ct. D. 1863).
IRS Slipping on Enforcement
Will more taxpayers cheat on their taxes as the threat of being audited by the IRS decreases? New data, which shows a steady decline in IRS enforcement activities, begs the question but offers no answers. IRS statistics, published by Transactional Records Access Clearinghouse (TRAC) at Syracuse University, reveal that the
International Accounting
What Accountants Can Do to Stop Corruption CPAs may not be able to stop corruption on their own, but they should be leaders of their countries’ collaborative efforts to oppose it. In particular, they should do everything they can to encourage organizational controls that expose corruption early—and stop it well
Taxpayers Give Preparers the Thumbs Up
Taxpayers Give Preparers the Thumbs Up A recent Harris poll revealed that 59% of individual taxpayers paid someone to prepare their taxes. Ninety-six percent of the taxpayers who used a tax preparer were either very satisfied (76%) or somewhat satisfied (20%) with the service they received. Fewer than four percent
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FROM THIS MONTH'S ISSUE
Build reusable Skills in Anthropic’s Claude AI
Instead of rewriting prompts each time, CPAs can turn routine tasks into reusable AI Skills. This Technology Q&A walks through how to build Claude Skills that process files, ask setup questions, and export clean Excel outputs.
From The Tax Adviser
April 30, 2026
Current developments in taxation of individuals: Part 2
April 30, 2026
