Most Recent Posts
IRS Lactation Intolerant
PLR 200941003 was about the deductibility of infant formula as a medical expense. Citing Revenue Ruling 55-261, the service held that the formula was not deductible; the reasoning was that the formula just provided for normal nutrition. I think the ruling is wrong and the basis that they used indicates that they missed the point of the ruling request. The ruling request was on the behalf of not, the presumably well-fed, infant, but rather on behalf of the mother, who as it happens, had had a double mastectomy.
Last Minute Goal by Taxpayers Makes FLP Hockey a Draw for 2009
The two IRS wins, Jorgensen and Linton, were, as usual, failures of execution. The entities weren’t respected. Personal bills were paid with partnership funds and partnership expenses were paid with personal funds. In Linton, the documents made it ambiguous as to which came first the funding or the gift. Jorgensen’s son commented that he just couldn’t “get his head around” the idea that the partnership wasn’t just like a bank account.
Cohan Rules
I made the Cohan rule the Prime Directive of Reilly’s Laws of Tax Planning – If you don’t have documentation, at least have a plausible story.
Read This Before You Bundle Grandma Onto the Plane
Originally published on PAOO December 30, 2009 just two days before the year without an estate tax. The end of that year promises to be a trope in many murder mysteries for years to come.
Those Pesky 1099s
I didn’t used to worry about this quite as much until I read the IRS audit manual for auto body repair shops. The writer makes the interesting observation that there might be more money in penalties for failure to withhold from the people you should have sent 1099’s than in disallowing deductions.
Devil Is In The Details
The ongoing accounting work required to maintain family limited partnerships is a key to their success.
All That Glitters is Not Taxed. Or is It ?
Where do virtual world transaction take place? – Yuan, a free lance professional WOW player in China raids several tough dungeons and earns 10,000,000 gold. He sells it to a wholesaler for $10,000 who will sell small lots of 500 gold to recreational players in every state in the United States for them to buy better armor or epic mounts within the game. Where did this happen? Can the US tax Yuan? Can Massachusetts tax the wholesaler who is located in Texas? Can Illinois, where the server is located, tax everybody?