Even after a bankruptcy petition is discharged, a taxpayer is still liable for taxes for which a tax return was both filed late and filed within two years of the bankruptcy petition. In one case, a married couple filed for bankruptcy. They filed a tax return late, after they filed for bankruptcy. They believed their … Read More
The word “probate” may conjure images of lengthy delays waiting for wealth to be transferred and bitter disputes among family members. Plus, probate records are open to the public, so all your “dirty linen” may be aired. The reality is that probate doesn’t have to be so terrible, and often isn’t, but both asset owners … Read More
When tax is unpaid, vehicles, real estate and other property may ultimately be seized by the IRS. To protect taxpayers’ rights, provisions are in place to govern the process. Recently, the Treasury Inspector General for Tax Administration (TIGTA) looked at how the processes were working. From fiscal years 2011 to 2017, seizures decreased by 58%. … Read More
Are you familiar with the Taxpayer Bill of Rights? Taxpayers have specific rights, which include a wide variety of issues and topics, when they interact with the IRS. The Bill of Rights covers what to expect when filing a return; paying taxes; responding to an IRS letter; going through an audit; and appealing an IRS … Read More
Certain IRS payments get reduced. Specifically, some payments made by the IRS are getting a “sequestration reduction” of 5.9% for fiscal year 2020 (Oct. 1, 2019, through Sept. 30, 2020). Under sequestration, automatic, across-the-board spending cuts are made to deal with the government’s budget deficit. Items that are subject to sequestration include whistleblower award payments; … Read More
As we all know, medical services and prescription drugs are expensive. You may be able to deduct some of your expenses on your tax return but the rules make it difficult for many people to qualify. However, with proper planning, you may be able to time discretionary medical expenses to your advantage for tax purposes. … Read More
The IRS is granting relief to U.S. persons who own stock in certain foreign corporations. Revenue Procedure 2019-40 limits the inquiries required by U.S. persons to determine if certain foreign corporations are controlled foreign corporations (CFCs). It also allows certain unrelated minority U.S. shareholders to rely on specified financial statement information to calculate their subpart … Read More
At this time of year, many business owners ask if there’s anything they can do to save tax for the year. Under current tax law, there are two valuable depreciation-related tax breaks that may help your business reduce its 2019 tax liability. To benefit from these deductions, you must buy eligible machinery, equipment, furniture or … Read More
The U.S. Tax Court ruled that being in jail doesn’t mean a tax return isn’t due. The taxpayer was a former pro basketball player who was convicted of wire fraud. While incarcerated, he received a $208,111 pension distribution. He didn’t file a return for the distribution year, so the IRS prepared a “substitute return” and … Read More
If you have minor children, arguably the most important estate planning decision you need to make is choosing a guardian for them should the unthinkable occur. If you haven’t yet made this decision, formalize your choice as soon as possible. When it comes to choosing the best candidate, you probably already have a short list … Read More