Most Recent Posts
CPA Sinks Under Millions In Aiding And Abetting Penalties On Mariners Deductions
The problem with the position that Kapp was recommending and using in preparing returns and schedules for returns not prepared by him, is that he was using the rate specified for meals and incidentals, which is about ten times the rate for just incidentals. You see Johnson was just a partial victory. A nonitinerant sailor is “away from home” when onboard, but only entitled to the much lower incidental per-diem, because the owners of ships have an apparently universal practice of feeding their sailors.
Joe Biden’s Tax Returns – No Reason Democrats Need To Overpay Their Taxes
You will find case law about taxpayers having income recharacterized because of low S corporation salaries, but I do not think that there are any such cases where the taxpayers were taking six-figure salaries. The reason for this is probably that there are a lot of C corporation cases where taxpayers are hit for taking salaries that are too high. A recent example was Dr. Afzal Ahmed, who wiped out $2.78 million in profit by taking a bonus. The IRS disallowed a million of the bonus.
As Rubin notes in his article Newt Gingrich was also criticized for using this technique, and I stood up for him too.
Florida Man Blows IRA Bankruptcy Protection
The facts, in this case, were pretty egregious. Will bankruptcy trustees start scrutinizing plan operations closely in order to find some foot fault that would disqualify them? Self-directed IRAs have always made me a little nervous and I find it a little shocking that the transactions described in this decision would not have set off alarm bells at the custodian. I’m thinking there might be a bigger story there.
The practical takeaway I get from the decision is that if you have reason to be concerned about asset protection, you might want to think about whether a self-directed IRA is your best choice since apparently, it is not just the IRS you have to worry about looking over your shoulder.
Clever Techniques To Defer Capital Gains – Maybe Too Clever
This is the technique that is most exciting Using an installment obligation as collateral will generally trigger gain recognition. The Monetized Installment Sale (MIS) purports to work around this allowing you to have the overwhelming bulk of the proceeds available for whatever purpose you want, while still deferring gain.
The support for this technique comes from a 2012 advisory letter from the IRS Chief Counsel Office – 20123401F . It’s important to note that this letter is not a blessing of the transaction. The revenue agent was asking whether the transaction should be attacked with either “substance over form” or “step transaction”. The Associate Chief Counsel told the revenue agent that it should not. So the answer was not that the taxpayers are right, just that they are not wrong in those particular ways.
Cannabis Company Harborside Goes Public – Will Appeal Multi-million $ Tax Court Ruling
The fundamental tax problem of the state-legal cannabis industry is Code Section 280E which denies ordinary and necessary business deductions for taxpayers trafficking in controlled substances. That was added to the Code in 1982.
Because we have an income tax, not a gross receipts tax, deductions still had to be allowed for the cost of goods sold. The Tax Reform Act of 1986 expanded the costs that were included in the cost of goods sold(Code 263A). This was generally not a taxpayer-friendly provision since it had the effect of deferring deductions in inventory.
Having deductions running through the cost of sales was good for the “traffickers” though. It is better to get a deduction later rather than never. In 2015, the IRS Chief Counsel snatched even this half loaf off the table with CCA 201504011.
Wealth Tax – That Pesky Constitution Might Get In The Way
This might be an example of how the non-binary parties (I hate calling them “third” since there are so many of them) end up having influence. I first encountered the wealth tax in the Green Party Platform while preparing to interview Jill Stein in 2012. Doctor Stein thinks it is quite a good idea.
Former DOJ Tax Lawyer Turned Lobbyist Pleads Guilty To Leaving $2.2 Million Off Tax Returns
Most tax preparers I know will tie themselves in knots to avoid documents like 1099s and W-2s not matching what goes on the return. They know from experience that if anything will get caught and cause embarrassing notices, mismatches will. The same care usually goes into K-1s, the forms used by partnerships and other flow-through entities to report income to owners and the IRS.
It turns out, however, that the IRS over the years has had a lot of trouble matching K-1 information to returns as is discussed in some detail in this article in this law review article by Valeriya Avdeev. Miller’s highest paying client was the Affordable Housing Tax Credit Coalition. If you work with housing credits, you learn about partnerships, so Mr. Miller might have been counting on IRS bumbling.
Freedom From Religion Foundation Won’t Take Clergy Housing Case To Supreme Court
Someone make the case that Joe Sixpack has to pay taxes on his income and doesn’t get any exclusion for his singlewide complete with a deck and a mangy dog sleeping under it, while Kenneth and Gloria Copeland live in an 18,280 square-foot lakefront parsonage on 25 acres valued at $6.2 million and exclude hundreds of thousands of dollars from income taxes under the housing allowance, or while Phil Driscoll enjoys not owing federal income taxes on $408,638 provided to him by his ministry to buy a second home on a lake near Cleveland, Tenn.
Deferred Sales Trust – A Tax Plan Or A Product ? A Bit Of Both
There is a veritable army of financial services providers offering DST as an option and explaining why it is such a good thing. They are members of the Estate Planning Team, which developed and implements DST.
If you are interested in joining the team, you can go to Why Join The Estate Planning Team? There are powerpoints with audio explaining the benefits to professionals of various sorts. Here is the one for CPAs and tax professionals. (Uses Flash)
Besides all the great referral business a CPA can get out of DST there is also the allure of a piece of the set-up fee on each transaction and a piece of the money management fee that is part of the whole package.
Want To Know What A Machinegun Is? Look It Up In Internal Revenue Code
The term “machinegun” means any weapon which shoots, is designed to shoot, or can be readily restored to shoot, automatically more than one shot, without manual reloading, by a single function of the trigger. The term shall also include the frame or receiver of any such weapon, any part designed and intended solely and exclusively, or combination of parts designed and intended, for use in converting a weapon into a machinegun, and any combination of parts from which a machinegun can be assembled if such parts are in the possession or under the control of a person.