Planning that maximizes the business bad debt deduction can help minimize the taxpayer’s overall economic loss.
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TOPICS / INDIVIDUALS
Deductions
Individual Taxation: Recent Developments
This article covers recent developments in the area of individual taxation arranged in Code section order.
Controversial Charitable Donation Rules Withdrawn
The IRS announced that it is withdrawing proposed regulations released last September that would have allowed charities to file information returns with the IRS and donors instead of providing contemporaneous written acknowledgments of charitable donations.
Bad News for Noncash Contributions
Most taxpayers are unaware of the stringent
regulations that apply to the substantiation of noncash charitable contributions and do not furnish the required information.
Standard Mileage Rates Will Go Down in 2016
The IRS issued the standard mileage rates for business use of an automobile and for driving for medical or moving purposes for 2016.
Casual Lender Not Allowed Bad Debt Deduction
A taxpayer who made high-interest loans to friends was not entitled to any bad debt deduction for a loan that went belly up because he did not prove that it was a business loan.
IRS to Implement Donee Reporting for Charities
The IRS will develop a specific-use information return for donee reporting.
Per-Diem Rates for 2015–2016 Travel Are Issued
The IRS issued its annual update of special per-diem rates for use in substantiating certain business-travel expenses.
Mortgage Interest Deduction Applies on a Per-Taxpayer Basis
Unmarried taxpayers who co-own a residence can each deduct interest payments on home-acquisition and home-equity debt up to the $1.1 million limit.
Poor Recordkeeping Hurts Taxpayers: Problems and Preventions
Recordkeeping and attention to the letter of the law should pay off in avoiding lost deductions.
Deduction for Seized Marijuana Goes Up in Smoke
The Tax Court held that the owner of medical marijuana dispensaries could not deduct the cost of marijuana seized by the DEA as costs of goods sold.
Special Per-Diem Rates Issued for 2015–2016 Travel
The IRS issued per-diem rates for use in substantiating business expenses taxpayers incur while traveling away from home.
Charities Would Be Permitted to Issue Information Returns to Donors
Charities will be allowed to file information returns instead of providing contemporaneous written acknowledgment of charitable donations under proposed regulations issued by the IRS.
Directions in Individual Taxation
This article covers recent developments in the area of individual taxation, including the treatment of support
payments and IRA and qualified plan distributions, the Sec. 469 material participation rules, and the taxability of state economic development credits.
Ninth Circuit Holds Mortgage-Interest Deduction Applies on a Per-Taxpayer Basis
Unmarried co-owners of two qualified residences each qualified for mortgage-interest deductions on up to $1.1 million of acquisition indebtedness the Ninth Circuit Court of Appeals held.
Charitable Deduction Not Allowed for Conveyance of Land Preservation Easement
The Tax Court held that taxpayers were not entitled to a charitable deduction for conveying a land preservation easement on their farm to a county to secure the county’s permission to sell development rights related to the property to a third party.
Long-Haul Truck Driver Has No Tax Home
A long-haul truck driver who spent most of the time on the road did not have a tax home that would allow him to deduct his unreimbursed travel expenses because he was not away from home, the Tax Court held.
2015 Standard Mileage Rates Are Issued
Optional standard mileage rates for use of a vehicle have changed little for 2015, with the business use rate going up and the medical and moving rate going down.
Maximizing Individuals’ Deductions for Startup Expenses
Sec. 195 allows taxpayers to deduct business startup costs that would be deductible under Sec. 162 if they were incurred in a trade or business.
Substantiating Expenses: All or Nothing
Without proper substantiation, no deduction is allowed for a Sec. 274(d) expense, even if the court believes that a legitimate expenditure was made.
INDIVIDUALS
Current Developments in Taxation of Individuals: Part 1
This update surveys recent federal tax developments involving individuals, including court cases, rulings, and guidance issued during the six months ending October 2025.
