Individual Income Taxation

TOPICS

June 1, 2007

Establishing Basis for Gambling Losses

Executive Summary Most taxpayers believe gambling proceeds are immune from tax, unless they receive a Form W-2G. Each pull of a lever or push of a button on a slot machine, hand of blackjack or spin of a roulette wheel is an individual wager that may result in gambling winnings.

June 1, 2007

AICPA Asks Congress to Repeal the AMT

On March 22, 2007, the House Select Revenue Measures Subcommittee held its second hearing on the individual alternative minimum tax (AMT), focusing on its effect on families. The AICPA was represented by Joseph W. Walloch, incoming chair of the AICPA Individual Income Tax Technical Resource Panel (TRP), CEO of Walloch

May 1, 2007

Providing Meals and Lodging to Employees

Editor: Albert B. Ellentuck, Esq. Under Sec. 119(a), meals provided by an employer—including a C corporation employer—can be excluded from an employee’s gross income if they are furnished on the business premises and for the employer’s convenience. The employer can deduct the full cost of these meals (the normal 50%

May 1, 2007

Teaching Ethics to Accounting Majors

Editor: Annette Nellen, CPA, Esq. Accounting professionals have faced increased pressure from regulators and the public in the wake of corporate scandals over the last few years. The sight of chief executive and financial officers parading into courtrooms has raised public awareness and concern about ethical behavior in management and

April 1, 2007

Innocent Spouse Relief

Editor: John L. Miller, CPA Searching the Internet under “innocent spouse relief” will turn up many organizations, CPAs, attorneys and others offering to assist a taxpayer with an innocent spouse claim. IRS Pub. 971, Innocent Spouse Relief (And Separation of Liability and Equitable Relief), explains the various types of relief,

April 1, 2007

Structured Settlements: Are Factoring and Commuting Different?

Although the Code appears to permit factoring, there is no clear answer as to whether annuity issuers can commute payments due under their own policies without adverse tax consequences.

April 1, 2007

Adjusting Basis of Inherited S Stock for IRD

Editor: Albert B. Ellentuck, Esq. Income in respect of a decedent (IRD) generally consists of items of gross income a decedent was entitled to at death that, because of the decedent’s method of accounting, were not included in the final individual return; see Regs. Sec. 1.691(a)-1(b). IRD is included in

April 1, 2007

Sec. 83 Risks when Compensating Founders in a New Venture

Co-Editors: Michael Metz, CPA; Nick Gruidl, CPA, MBT The founders of a new venture are often entrepreneurs who have the ideas and relationships to start and create a successful venture, but not the capital to sustain and develop it. Venture capitalists, private-equity funds and public markets satisfy the needs of

April 1, 2007

AMT Repeal: Top Priority for National Taxpayer Advocate and AICPA

The top priority for Federal tax reform should be repeal of the alternative minimum tax (AMT) for individuals, National Taxpayer Advocate Nina E. Olson said in her annual report to Congress at the end of 2006. The AICPA has also endorsed outright repeal of the individual AMT (similar to S

April 1, 2007

Online AMT Calculator

According to IR-2007-18, the IRS has updated its Internet-based calculator to help taxpayers determine whether they owe the alternative minimum tax (AMT). The online AMT Assistant is an automated version of Worksheet to see if you should fill in Form 6251, Alternative Minimum Tax. The worksheet, contained in the Form