Gains & Losses

The taxation of collectibles

This article discusses what assets are treated as collectibles subject to the 28% rate, the netting process for collectibles gains and losses, how gains on the sale of collectibles are taxed, and practical strategies that taxpayers can use to lessen the impact of the 28% rate.

TIGTA reports large increase in alimony tax gap

Discrepancies between the amount of alimony deducted by payers and reported as income by its recipients increased by 38% in six years, the Treasury Inspector General for Tax Administration reported.

Deducting losses after an S corporation terminates

A special relief provision allows unused losses caused by a lack of basis to be deducted by an S corporation shareholder under certain conditions for one year (or more) during the S corporation’s post-termination transition period.

IRS provides clarity in second round of opportunity zone regulations

Several tax benefits can accrue to taxpayers that make investments in certain low-income communities through qualified opportunity funds. A second round of proposed regulations addresses many outstanding questions about this new vehicle for taxpayer-friendly investing in distressed communities.

Opportunities beckon in new qualified opportunity zones

With their prospects for deferral or even exclusion of gains from certain investments in them, the newly created qualified opportunity zones offer an intriguing tax planning option for investors and a potential boon for distressed communities.

New limitation on excess business losses

The TCJA amended Sec. 461 to include a subsection (l), which disallows excess business losses of noncorporate taxpayers if the amount of the loss is in excess of $250,000 ($500,000 in the case of a joint return).

Involuntary conversion of a principal residence

Every year, many taxpayers’ principal residences are destroyed or taken through condemnation by the government. This article discusses the application of Secs. 121 and 1033 when a taxpayer suffers an involuntary conversion of a principal residence.

Opportunities beckon in new qualified opportunity zones

With their prospects for deferral or even exclusion of gains from certain investments in them, the newly created qualified opportunity zones offer an intriguing tax planning option for investors and a potential boon for distressed communities.

Individual tax report

This semiannual update on current developments in the area of individual taxation includes a number of cases on material participation, hobby losses, charitable contributions, the Sec. 199A regulations, and several other important areas.

Newsletter Articles

TAX REFORM

Traps for the unwary: Tax Cuts and Jobs Act changes

By now many of us are familiar with the various provisions of the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97. Here is a list of changes together with (perhaps) unexpected nuances.

DEDUCTIONS

Qualified business income deduction regs. and other guidance issued

The package includes final regulations, guidance on how to calculate W-2 wages, a safe-harbor rule for rental real estate businesses, and new proposed rules on the treatment of previously suspended losses.