The IRS explained that contributions to disregarded SMLLCs wholly owned and controlled by a U.S. charity will be treated as if made directly to the U.S charity.
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TIGTA Recommends Steps for IRS to Reduce Fraudulent Refunds From Identity Theft
TIGTA reported that the IRS had missed 1.5 million tax returns with potentially identity-theft-related fraudulent tax refunds in excess of $5.2 billion for the 2011 filing season.
Proposed Regs. Would Clarify Who Is Subject to Sec. 274(n) Limit on Meal Expenses
The IRS released proposed regulations clarifying which party is subject to the rule that limits the deduction for meals to 50% of the expenses incurred.
Regulations Finalize Rules on Entertainment Use of Business Aircraft
The IRS issued final regulations relating to the disallowance under Sec. 274 of deductions for the use of business aircraft for entertainment.
Treasury Releases Model Intergovernmental Agreement for FATCA
Treasury released a model intergovernmental agreement designed to implement the information-reporting and withholding-tax provisions in FATCA.
Taxpayers Who Did Not Establish Insolvency Must Recognize COD Income
Taxpayers who settled a credit card debt for $4,412 less than they owed in 2008 had to include that amount in income because they did not prove they were insolvent under Sec. 108(a)(1)(B) at the time of the debt discharge (Shepherd, T.C. Memo. 2012-212). Sec. 108(a)(1)(B) excludes cancellation of debt
Tax Court Upholds Regulation Requiring Dependents Be Citizens in Year Tax Benefits Are Claimed
The Tax Court upheld Regs. Sec. 1.152(a)(1), which requires that children be U.S. citizens at some time during the calendar year for which the children are claimed as dependents.
AICPA Recommends Changes to Tangible Property Guidance
The AICPA recommended various changes and simplifications to the regulations regarding the treatment of expenditures incurred in selling, acquiring, producing, or improving tangible assets.
Self-Employed Can Deduct Medicare Premiums, IRS Chief Counsel Advises
The Office of Chief Counsel advised that self-employed individuals may deduct Medicare premiums from their self-employment income.
New Rules Aim to Shut Down Certain Outbound Asset Reorganizations
The IRS issued rules to govern certain outbound asset reorganizations involving the transfer of intangibles under Sec. 367(d) that will apply instead of existing regulations
Tax Court Petition Challenging a Notice of Deficiency Suspends Statute of Limitation
The Eleventh Circuit held that a petition filed by taxpayers who had transferee liability for their corporation’s tax liability was a “proceeding in respect of the deficiency” that suspended the limitation period for assessment
Debtors’ Taxes Are Not Discharged in Bankruptcy Where Tax Return Was Filed Late
A federal appeals court held that bankrupt debtors who filed their income tax return 17 months after their income taxes were assessed were not entitled to have those taxes discharged in the bankruptcy proceeding.
Supreme Court Upholds Health Care Law
The Supreme Court declared the mandate requiring U.S. citizens and legal residents to maintain minimum essential health coverage to be a permissible exercise of Congress’s taxing powers under the Constitution.
IRS Releases New FAQs for Offshore Voluntary Disclosure Program, Announces Other Rules
The IRS released 55 questions and answers regarding its offshore voluntary disclosure program.
Sample Text for Sec. 83(b) Election Released by IRS
The IRS released sample language for making the Sec. 83(b) election and examples of the amount of income taxpayers would recognize if they made the election.
Guidance Clarifies When Dividends Are Qualified Performance-Based Compensation
The IRS ruled on whether dividends paid on restricted stock were qualified performance-based compensation excluded from the applicable employee remuneration to which the $1 million limitation on the deduction for compensation by publicly held corporations applies.
IRS Suspends Issuing ITINs Without Original Documentation
The IRS will no longer issue individual taxpayer identification numbers unless the applicants provide original documents, such as passports or birth certificates, or certified copies of those documents from the issuing agencies.
Tips and Service Charges Distinguished in Guidance
The IRS issued question-and-answer guidance for distinguishing between tips and service charges for FICA tax and other purposes.
PTPs Can Use Safe Harbor to Determine COD Income That Is “Qualifying Income”
The IRS issued a safe harbor for publicly traded partnerships (PTPs) that want to avoid corporate taxation by qualifying under Sec. 7704(c) as partnerships with 90% or more of their income from qualifying sources.
IRS Issues Rules on Portability Election
The IRS has issued temporary regulations on how to elect to use a deceased spouse’s unused exclusion from estate taxes, also known as the portability election.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
