Most Recent Posts
Julian Block On Deducting Worthless Loan To Spouses
These being the times they are, you may be tapped for loans by relatives or friends who are unable to come up with the down payment for a home or who wants to start a...
Guest Post From Bob Baty – Rudy Davis v. Robert Baty – “Worse than rape!”
One of the side issues of the Kent Hovind drama that I had stayed away from is the "worse than rape" controversy. Several people signed affidavits that they had heard...
Julian Block Tells You to Forget About Deducting Your Business Suits
Generally, clothing costs aren’t allowable as “ordinary and necessary” business expenses. They’re nondeductible personal expenses. The IRS prohibits write-offs...
IRS Scandal – Blame It All On Lois Lerner And Move On?
Republicans have been hoping that there would be a smoking gun in all those interviews and documents. I mean wouldn’t it be great if there were a taped conversation in which President Obama ordered the IRS to harass the Tea Party. Senator Wyden indicates that nothing anywhere near to that has turned up. Senator Hatch, on the other hand, thinks the smoking gun has been hiding in plain sight.
Regardless of whether an explicit directive was given, the President gave the order to target conservative groups at every opportunity – the State of the Union, in press conferences, and in TV interviews. He didn’t send a “smoking gun” email because he did not need to – he gave the order for all to hear. And his political allies at the IRS followed those orders
Senator Wyden in his statement points out the inconvenient facts that the IRS Commissioner at the time had been appointed by President Bush and that Lois Lerner had been promoted to head the Exempt Organization group by a Bush appointed IRS Commissioner. Go figure. So I guess the TaxProf can keep the count going.
USCT Reenactor Responds To The Neoconfederate From Bavaria
Back in June I had a guest post from Georg Snatzke about his experience of the Civil War Sesquicentennial. Georg is from Bavaria, He dedicated his vacatons from 2011...
IRS Says Charitable Trust Not Charitable Enough
The Schaefer case is about a charitable estate tax deduction for two NIMCRUTs. You start out with the value of the assets in the trusts and then you do some fancy math – life contingencies combined with present value – to divide that between the income interest and the remainder interest. The latter is deductible either for estate tax purposes as in this case or as an income tax deduction. If the remainder interest computes to less than 10% of the overall value, no charitable deduction is allowed.
The higher the payout ratio, the lower the value of the remainder. One of the trusts had a payout rate of 10% and the other was 11%. Both the IRS and the executor agreed that with that payout the charity would be getting less than 10% of the value. The executor argued that in doing the valuation the net income limit should be taken in account. Apparently there was some sense that the trust would not hit that target rate. The Tax Court wanted them to also consider using 5%, which is the minimum allowed payout rate.
Does Paper Filing Avoid Identity Theft?
Lu Gauthier of Boston Tax Institute has given me permission to reproduce his email blasts. Two practitioners have responded to our request below: one files only PAPER...
Lu Gauthier Issues Warning About Information Returns
Lu Gauthier has given me permission to publish his email blasts. This one is particularly important. Many business owners are not aware of how many vendors they need...
Citizens United Fighting To Keep Dark Money As Dark As Possible Loses To NY AG
In addition to the IRS exempt organizations that solicit money are also regulated by the states where they raise money. There are various filings required, sometimes much more rigorous than what the IRS requires. As part of the package though, they will usually want a copy of the Form 990 that the organization files with the IRS. That’s the way it is in Massachusetts anyway and apparently in New York too. CU had been sending the New York AG its 990 since 1995. They had not been including Schedule B and nobody seemed to mind. The Charities Bureau conducted a survey of its operations in 2012 and noticed that certain organizations were not including Schedule B with annual reports. The AG implemented an across-the-board initiative to identify and notify the organizations that had not been filing Schedule B with their state reports. In April 2013 the CU organizations were notified that their filings were incomplete.
Julian Block On How To Take A Tax Deduction For Protecting Your Good Name
Julian Block has agreed to help me in my effort to become the Tom Sawyer of blogging. Ordinarily, deductible business expenses include payments to settle disputes,...