The National Taxpayer Advocate (NTA) is reporting that as of late October, the IRS had a backlog of more than 2.7 million unprocessed amended tax returns. The IRS claims the processing time for these returns is about 20 weeks. The NTA, however, says that Taxpayer Advocate Service (TAS) cases indicate that it’s taking the IRS … Read More
Do you have a tax-saving flexible spending account (FSA) with your employer to help pay for health or dependent care expenses? It’s a good time to review 2021 expenses and project amounts to be set aside for 2022. A pre-tax contribution of $2,750 to a health FSA is permitted in 2021. This is increasing to … Read More
The IRS Criminal Investigation (CI) department investigates potential criminal violations of the federal tax code and related financial crimes. Enforcement actions focus on tax and COVID-19-related fraud, money laundering, cybercrimes and more. The “IRS-Criminal Investigation (IRS-CI) Fiscal Year 2021 Annual Report” was released by the agency on Nov. 18. The report provides details about more … Read More
The IRS recently announced next year’s cost-of-living adjustment amounts. For 2022, the federal gift and estate tax exemption has cracked the $12 million mark: $12.06 million to be exact. Arguably more notable, the annual gift tax exemption has increased by $1,000 to $16,000 per recipient ($32,000 for married couples). It’s adjusted only in $1,000 increments, … Read More
Control deficiencies in IRS financial systems have led to errors to taxpayer accounts, according to the Government Accountability Office (GAO). In general, IRS financial statements reviewed by the GAO were reliable and financial reporting controls were effective, “although some information system and unpaid assessment controls could be improved.” Controls related to unpaid tax bills contain … Read More
In Notice 2021-61, the IRS recently announced 2022 cost-of-living adjustments to dollar limits and thresholds for qualified retirement plans. Here are some highlights: Elective deferrals. The annual limit on elective deferrals (employee contributions) will increase from $19,500 to $20,500 for 401(k), 403(b) and 457 plans, as well as for Salary Reduction Simplified Employee Pensions (SARSEPs). … Read More
Every business should prepare an annual budget. Creating a comprehensive, realistic spending plan allows you to identify potential shortages of cash, possible constraints on your capacity to fulfill strategic objectives, and other threats. Whether you’ve already put together a 2022 budget or still need to get on that before year end, here are four red … Read More
Taxpayers with foreign accounts worth more than $10,000 in the preceding year must file a “Report of Foreign Bank and Financial Accounts” (FBAR). Failure to file can result in hefty penalties, though if non-willful, penalties are limited. Previously, a U.S. District Court ruled that the penalty is assessed per FBAR form. That would mean multiple … Read More
On November 17, the Financial Accounting Standards Board (FASB) issued a new accounting standard on disclosing certain types of government incentives that businesses receive to set up shop in a locality. The standard comes at a time when investors have been clamoring for more detailed information around incentives businesses get — some to the tune of … Read More
As 2021 comes to an end, the IRS wants to remind you of certain tasks you may want to accomplish before Dec. 31. To reduce this year’s tax liability, charitable donations must be made by year-end. In 2021, even those who don’t itemize can claim a limited $300 deduction, or $600 for married couples who … Read More