Tax law generally prohibits a parent from shifting income from personal services to a child; however, a parent can in some cases effectively shift income to a child by transferring income-producing property to the child.
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Individuals
IRS Provides Guidance on Contributions to HSAs
The Tax Relief and Health Care Act of 2006, P.L. 109-432, made changes to the treatment of contributions to health savings accounts (HSAs) under Sec. 223. The IRS issued two notices explaining those changes.
When Plaintiffs in Class Actions Pay Tax on Attorneys’ Fees
The taxation of attorneys’ fees in opt-out class actions has become relatively clear, as long as certain elements are established. In opt-in cases, class members risk being tagged with income in the amount of the attorneys’ fees.
Tax Aspects of Contributing a House to a Fire Department
Taxpayers can obtain a charitable contribution deduction for the fair market value of property donated to a fire department to be burned down. The taxpayer needs to properly structure the transaction so that the property, and not just the right to use the property, is being donated.
IRS Announces Disaster Relief for Hurricane Victims
The IRS announced tax relief under Sec. 7508A for Louisiana and Texas taxpayers who were affected by Hurricanes Gustav and Ike.
Tax-Deferred Exchanges of Vacation Homes
The IRS carved out a safe harbor for the exchange of vacation homes to qualify for Sec. 1031 treatment.
Teaching Tax Through the Socratic Method
This column explores a type of active learning pedagogy that university and continuing education instructors should consider using in order to help students attain more permanent and meaningful learning.
Service Provides Guidance on Children of Divorced Parents
The IRS released guidance on the circumstances under which it will treat a child of parents who are divorced, separated, or living apart as the dependent of both parents for various purposes when the custodial parent has not released the claim to the child’s exemption.
When Are Payments Treated as Child Support?
Payments are child support for tax purposes if they are either so designated in the divorce or separation agreement (fixed child support) or deemed to be child support.
Tax Aspects of an Author’s First Book
The IRS’s longstanding position is that “if an individual writes only one book as a sideline and never revises it, he would not be considered to be ‘regularly engaged’ in an occupation or profession and his royalties therefrom would not be considered net earnings from self-employment.”
Selling a Business: Substance and Form Really Do Count
Three concepts regularly come into play when contemplating the sale of a business: noncompete covenants, consulting agreements, and goodwill.
Using Debt to Leverage a Taxable Gift to a QPRT
A qualified personal residence trust is a trust created to own a personal residence of the grantor for the benefit of the grantor’s spouse, children, or charity. The grantor makes a gift of a personal residence into the trust while retaining a right to occupy the residence for a term of years.
The New Student Tax
The Internal Revenue Code contains a number of tax incentives to encourage college attendance. However, it also contains one “student tax” disincentive.
Vacation Property Rental and Resale
The vacation home rules have always been confusing, and with the enactment of Sec. 121(b)(4) they have become more convoluted for clients who convert a vacation home to a principal residence.
Sec. 6015 Does Not Preempt State Community Property Law for Refund Purposes
The Ninth Circuit affirmed the Tax Court and held that Sec. 6015 does not preempt state community property law with respect to an innocent spouse’s right to a refund.
Prop. Regs. Govern Charitable Contribution Substantiation and Reporting
Tthe IRS issued proposed regulations that would change the rules regarding substantiation and reporting of charitable contributions.
Housing Act Contains Tax Provisions
On July 30, 2008, the president signed into law the Housing Assistance Tax Act of 2008, containing tax provisions affecting homeowners and first-time homebuyers, as well as changes to the rules governing the low-income housing credit, tax-exempt bonds, and the alternative minimum tax (AMT).
Individual Taxation Report
This article covers recent developments affecting taxation of individuals, including legislation, regulations, and IRS guidance.
Final Regs. Clarify “Counting Nights” Rule for Dependents
When a child of divorced or separated parents lives with both of them during the year, the right to claim the dependency exemption may be released by the “custodial parent” (Sec. 152(e)). The custodial parent is defined as the parent with whom the child resides for the longest period of
Tax Court Does Not Have Jurisdiction Over Duplicate Request for Relief
The Tax Court held that it lacked jurisdiction over a request for Sec. 6015(f) equitable relief that was based on the same facts and grounds for relief as an earlier request that had been denied by the IRS. Facts Judith Barnes was married to Nathan Genrich. On their joint return
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.
