This article discusses the history of the deduction of business meal expenses and the new rules under the TCJA and the regulations and provides a framework for documenting and substantiating the deduction.
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TOPICS
Individuals
Sec. 199A and Subchapter M: RICs vs. REITs
Sec. 199A, may create a potential difference in how the same type of income is taxed to shareholders of RICs and REITs and therefore offers an opportunity for fund managers.
Procedures for nonfilers claiming advance CTC payments
The IRS explained in a revenue procedure how individuals can claim advance child tax credit payments and stimulus payments if they are not required to file 2020 federal income tax returns.
Farm businesses receive guidance on tax treatment of losses
The IRS in Rev. Proc. 2021-14 specifies procedures regarding limitation and carryback of net operating losses from farming in light of CARES Act provisions.
Bank information can now be updated on child tax credit portal
The IRS announced that is has added a new feature to its Child Tax Credit Update Portal to allow individuals to enter bank information so they can receive advance child tax credit payments by direct deposit.
ARPA expands tax credits for families
The American Rescue Plan Act made significant changes to the child tax credit and child and dependent care credit for the 2021 tax year, making the credits larger for most taxpayers and more widely available.
Penalty relief for Forms 5471, 5472, and 8865
Various options are available for mitigating penalties for noncompliance with foreign return filing requirements.
Virtual currency update
Treasury takes a more aggressive stance on reporting of virtual currency transactions.
ARPA-adjusted 2021 individual credit amounts set
The IRS issued guidance on the amount of and limitations on the child tax credit, earned income tax credit, and premium tax credit available for taxpayers for the 2021 tax year.
IRS reminds taxpayers of ARPA suspension of 2020 excess APTC repayment
The IRS said it would not require taxpayers who received excess advance premium tax credits for 2020 to file Form 8962, Premium Tax Credit, after the American Rescue Plan Act retroactively exempted those amounts from being taxe
Taxation of qualified tuition plan contributions and distributions
Taxpayers can avoid unplanned taxes and penalties by carefully following rules for contributions to and
distributions from tax-favored education savings vehicles and making sure distributed funds are used for “qualified higher education expenses.”
‘Restaurant’ defined for 100% deductible business meals in 2021 and 2022
The IRS issued guidance on the temporary rule that allows a 100% deduction for eligible restaurant meals in 2021 and 2022.
Next batch of ‘Dirty Dozen’ warns of personal info scams
In the second installment of this year’s “Dirty Dozen” list of tax scams, the IRS warns taxpayers to be vigilant for fraudulent schemes in the form of emails, text or social media messages, and phone calls.
IRS warns of pandemic-related tax scams in ‘Dirty Dozen’ for 2021
Hijacking of economic impact payments and unemployment checks are spotlighted in the IRS’s annual alert, which warns taxpayers of the most prevalent scams and schemes the Service has identified.
Child tax credit: New portal for opting out of advance payments
A new IRS online portal lets taxpayers unenroll from receiving advance payments of the 2021 child tax credit.
Supreme Court lets health care law stand
The US Supreme Court held that Texas and several other states lacked standing to sue over the constitutionality of the Sec. 5000A mandate that requires individuals to obtain minimum essential health coverage. The decision leaves the Affordable Care Act in place.
Online sign-up now available for advance child tax credit payments
The IRS opened an online site that allows taxpayers who are not required to file a 2019 or 2020 individual income tax return to sign up to receive advance child tax credit (advance CTC) payments, which will begin July 15.
IRS posts ARPA credit FAQs
The IRS has posted two sets of FAQs that explain changes to the child and dependent care credit and to the sick and family leave credits made by the American Rescue Plan Act.
Compensatory split-dollar life insurance benefits are compensation
Economic benefits from a compensatory split-dollar
life insurance arrangement are not property distributions.
IRS refunding taxes overpaid on unemployment benefits
To help taxpayers who might otherwise have been required to file amended income tax returns, the IRS announced that it will automatically issue to eligible taxpayers refunds of income tax paid on 2020 unemployment benefits.
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.
