Several community property states have laws that allows same-sex couples to establish registered domestic partnerships, which create a number of unique federal tax issues.
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Individuals
IRS Issues Foreign-Targeted Bond Guidance
The IRS issued interim guidance on registration of foreign-targeted bonds and provided transitional relief for withholding agents on the related portfolio interest exception.
IRS Expands “Fresh Start” Initiative, Provides Penalty Relief for Unemployed
The IRS announced an expanded “Fresh Start” initiative to help struggling taxpayers with a number of measures for relief.
Tax Court Says Limitation on Deductible Mortgage Interest Applies to Unmarried Co-Owners
The Tax Court held that unmarried co-owners were together subject to the $1.1 million limit on personal residence indebtedness under Sec. 163(h)(3).
2012 Automobile Depreciation Limits Released
The IRS issued the 2012 inflation adjustments to the depreciation limitations and lease inclusion amounts for certain automobiles under Sec. 280F.
IRS Proposes New Equitable Innocent Spouse Relief Rules
The IRS issued a proposed revenue procedure changing the way it will treat requests for equitable innocent spouse relief under Secs. 66(c) and 6015(f).
When Is Form 8283 Required to Be Filed?
The IRS should revise the instructions for Form 8283 to more clearly explain when it is required to be filed, given that the instructions state that failure to file the form can cause the deduction to be disallowed in its entirety.
Individual Taxation Developments
This article covers recent developments affecting individual taxation. The items are arranged in Code section order
Preserving Tax Losses by Avoiding the Wash-Sale Rules
A taxpayer cannot deduct the loss realized on the sale of stock or securities (including shares in a mutual fund) if the taxpayer purchases substantially identical stock or securities within the period beginning 30 days before and ending 30 days after the sale.
President Signs Payroll Tax Cut Extension Bill; New Form 941 Released
President Barack Obama signed into law the Middle Class Tax Relief and Job Creation Act of 2012 and the IRS released a revised Form 941to reflect the extended payroll tax cut.
Supreme Court: Filing a False Tax Return Can Lead to Deportation
The Supreme Court held that a conviction under Sec. 7206 for willfully filing a false tax return (or for aiding and abetting filing a false tax return) is an aggravated felony that can result in deportation.
Congress Passes Payroll Tax Cut Extension
On Feb. 17, the House of Representatives and the Senate both passed a bill that will extend the reduced 4.2% Social Security tax rate through the end of the year.
Couples Who Filed Joint Returns Must Now File Separate Powers of Attorney
The new version of the IRS power of attorney form requires a husband and wife who filed a joint tax return to each file a separate power of attorney on separate forms to designate the representative he or she chooses, even if it is the same person.
Integrating Circular 230 into the Tax Curriculum: Appendix
This appendix provides a more detailed suggested solution to the five questions presented in the Feb. 2012 Campus to Clients column.
Integrating Circular 230 into the Tax Curriculum
Circular 230 is crucial to tax education because it forms the ethical standards of tax practice. Students who plan to become tax practitioners must become well acquainted with Circular 230 along with the underlying laws and regulations governing tax practice.
2012 Standard Mileage Rates Released
The IRS released standard mileage rates for use in 2012.
Exercise of Stock Options Results in Taxable Income and Compensation Deduction
The IRS held that a taxpayer’s cashless exercise of stock options resulted in taxable income to the taxpayer and a compensation deduction for the company that issued the options.
Timing Considerations of Discharging Taxes in a Chapter 7 Bankruptcy
This article discusses liquidations under Chapter 7 and focuses on individuals who are attempting to have their debts discharged, or wiped out, in bankruptcy.
Individuals Who Are Eligible for Medical Services at IHS Facilities May Still Participate in HSAs
The IRS explained that people who are eligible to receive medical services at Indian Health Service facilities are not automatically disqualified from making tax-free contributions to HSAs.
Tax Court Rules on Homebuyer Credit When Former Residence Is Being Sold
The Tax Court held that a married couple’s old house, which they continued to use while trying to sell it, qualified as a principal residence, and therefore they did not meet the timing requirement to qualify for a first-time homebuyer credit when they purchased a new house.
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.
