The IRS released its updated procedures for automatic accounting method changes, which are accounting method changes that can be made without the IRS’s consent.
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TOPICS
Tax
IRS posts 2020 inflation adjustments and tax tables
The IRS released the 2020 tax tables for individuals and estates and trusts, as well as the inflation adjustments for over 60 tax provisions for 2020 tax returns.
Retirement plan contribution limits increase for 2020
Annual contribution limits for 401(k) plans will increase from $19,000 in 2019 to $19,500 in 2020, and most other limits are increasing as well.
Updating the Statements on Standards for Tax Services
An AICPA task force is evaluating how these key guidelines for tax practices need to be updated to account for changes in technology and law.
Preparer’s forgetting to hit ‘send’ doesn’t excuse clients’ late-filing penalties
Taxpayers’ reliance on a preparer to e-file their extension request is not reasonable cause, a district court holds.
Line items
Prop. regs. update valuation limit for employee use of vehicle … Rules proposed for classifying cloud and digital content transactions … Nondiscrimination rules relief extended
Responsible person rules in the wake of Wayfair
As states impose sales tax collection obligations on more companies, individual taxpayers face a greater risk of personal liability if their organization fails to comply.
Mayo Clinic held to be an educational organization despite engaging in noneducational activities
A district court invalidates a regulation requiring educational activities to be an educational organization’s primary function and its other activities to be merely incidental to those activities.
Planning for Medicare taxes, premiums, and surcharges
Don’t neglect these basic health care considerations in clients’ retirement planning.
Taxpayers may revoke or make late bonus depreciation elections
Late elections or revocations made during the time prescribed in Rev. Proc. 2019-13 will be treated as automatic changes in method of accounting with a Sec. 481(a) adjustment.
Like-kind exchanges and personal property
A recent law change invites new strategies.
Alimony tax gap swells to $3.2 billion, TIGTA finds
The difference resulted in $248 million of tax underreporting.
TIGTA outlines IRS challenges for 2020
The memorandum lists 10 challenges in order of importance, ranging from data security to achieving operational efficiencies.
Taxpayers may deduct casualty losses in prior years
The IRS finalized regulations permitting taxpayers to deduct disaster losses in the prior tax year and removed the related temporary regulations that were issued in 2016.
IRS clarifies the tax treatment of cryptocurrency ‘hard forks’ and ‘airdrops’
The IRS ruled that a taxpayer does not have gross income as a result of a hard fork of a cryptocurrency if the taxpayer does not receive units of a new cryptocurrency, but does have gross income as a result of an airdrop of new cryptocurrency after a hard fork if the taxpayer receives units of the new cryptocurrency.
CFC downward attributions get safe harbors
U.S. shareholders who own stock in foreign corporations were given a safe harbor by the IRS, making it easier for them to establish that they are not shareholders in a controlled foreign corporation, or CFC.
Improving IRS practitioner services
The Taxpayer First Act embodies several principles for improved IRS customer service that have been central to AICPA advocacy efforts in recent years.
Taxpayer’s IRA rollover was timely
A rollover that took more than 60 days to complete due to a bookkeeping error was considered timely.
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IRS writes taxpayers with virtual currency transactions … Nonemployee compensation gets its own Form 1099 … Olson offers winding ‘Taxpayer Roadmap’
Final rules permit truncated TINs on W-2s
If an employer elects, forms issued to employees starting in 2021 will show only the final four numerals of their SSN.
Features
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How to craft the CPA career you want
Want to pursue a work life that brings you purpose and joy? Learn how in this article from the Journal of Accountancy’s November issue.
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