New Rules in the United States Tax Court... [ read ]
The Tax Court has recently adopted amendments to its Rules of Practice and Procedure. These amendments come more than two years after the Tax Court proposed amendments to its rules to accommodate electronic filing of petitions and other documents. Pursuant to the new amendments to its rules, the Tax Court will soon allow electronic filing of Tax Court petitions and other documents. (The Tax Court will provide detailed information regarding the implementation of electronic filing on its website once the Tax Court is ready for electronic filing.) Under the new rules, if a Tax Court petition is filed electronically, an original signature is no longer required from the taxpayer or the taxpayer's representative.
IRS Revises Voluntary Disclosure Practice... [ read ]
On November 20th, the IRS issued Memorandum LB&I-09-1118-014 updating the process for both domestic and foreign voluntary disclosures. The IRS voluntary disclosure program is found in section 188.8.131.52 of the Internal Revenue Manual and is a long standing practice of the IRS to provide taxpayers who have potential criminal exposure a means to come into compliance with the law and potentially avoid criminal prosecution. In a prior blog post , we discussed the basics of the IRS voluntary disclosure program.
Reacting and Responding to the Commencement of an IRS Criminal Investigation... [ read ]
How a taxpayer or tax professional reacts and responds to a visit by IRS criminal investigators may mean the difference between a criminal indictment and the IRS declining to pursue a criminal case.
Changes Are Coming to Form 8867 and Preparer Due Diligence Requirements... [ read ]
Significant changes are coming to Form 8867, Paid Preparer's Due Diligence Checklist, and the associated requirements for the 2019 filing season. On November 5, 2018, the IRS issued final regulations under Treas. Reg. 1.6695-2 to clarify when and how return preparers must conduct due diligence.
If You Use it, You Won't Lose It: IRS Says Taxpayers Won't Lose Benefit of Higher Gift Tax Exemption... [ read ]
Apparently the IRS is feeling the holiday spirit. The IRS just proposed regulations allowing taxpayers to lock-in the higher gift tax exclusion amount, which was raised under the 2017 Tax Act from $5 million to $10 million per person (indexed for inflation). For married couples, the combined exclusion amount for 2018 is $22,360,000. Under these proposed regulations any future decrease in the exclusion amount will not cause otherwise non-taxable transfers made at a time when the exclusion amount was higher to be taxable - ever. Thanks Uncle Sam!
Update from the IRS Regarding Like-Kind Exchanges... [ read ]
On November 19th, the IRS issued IR-2018-227, reminding taxpayers that Like-Kind exchange tax treatment is now generally limited to exchanges in real property that is held for use in a trade or business or for investment. Real property includes land and generally anything built on or attached to it. An exchange of real property held primarily for sale still does not qualify as a Like-Kind exchange.
The IRS Continues Assessing Employer Shared Responsibility Payments... [ read ]
The IRS continues issuing Letter 226-J notices proposing assessments that are commonly referred to as "employer penalties" under the Affordable Care Act. The letters state that the IRS has made a preliminary calculation of the employer's Employer Shared Responsibility Payment ("ESRP") obligation. Letter 226-J is typically accompanied by Form 14764, ESRP Response; Form 14765, Employee Premium Tax Credit Listing; and states the amount of the proposed ESRP. Employers who disagree with the proposed ESRP must complete and return Form 14764 within thirty days and identify any errors in the letter on Form 14765. In addition, the IRS frequently issues a Letter 227-K or Letter 227-L to provide employers additional information about the proposed ESRP.
IRS Criminal Investigation Releases Its 2018 Annual Report... [ read ]
On November 14, IRS Criminal Investigation released its 2018 Annual Report. The report comes on the heels of IRS-CI Deputy Chief Eric Hylton's statement at the ABA Section of Taxation meeting in early October that CI plans to hire 250 new special agents over the next 18 months.
The ‘Silver Tsunami' and the Golden Age of Wealth Transfer... [ read ]
Studies estimate that over the next fifteen years, society's aging population will transfer an unprecedented $25 trillion in wealth accumulation to the next generation. The recent spike of the lifetime estate and gift tax exemption amount inflates the opportunities for successful wealth transfer.
Tax Court Sends Another Sobering Reminder to Taxpayers: Carefully Review Your Tax Return Before Filing... [ read ]
The Tax Court made itself loud and clear again in its recent decision Yapp v. Commissioner: carefully review your return before filing even if a professional is used to prepare the return. A failure to do so can have drastic consequences down the road.