Aug
14
2018
14
2018
Jul
03
2018
03
2018
IMPORTANT INFORMATION FOR ALL PARTNERSHIPS AND LLC’s TREATED AS PARTNERSHIPS FOR TAX
Partners often personally pay for partnership expenses that are not reimbursed by the partnership. These expenses, referred to as UPE, can be personally deducted against partnership income/(loss) on your income tax return, BUT ONLY IF the partnership agreement allows for it. Since these expenses can no longer be taken as a miscellaneous itemized deduction, consider adding the following to your partnership agreement if it is not already there:
Expenses Incurred on Behalf of Partnership
The partnership has always recognized that is is essential to the successful conduct of its business that,
Jun
21
2018
21
2018
Spring Statistics of Income Bulletin
The IRS just published its Spring Statistics of Income Bulletin with a mixed bag of results. Individual adjusted gross income between 2015 and 2016 showed a minor uptick of 0.1% to $10.2 trillion, reflecting higher salaries, wages, pensions and annuities. But taxable income decreased by 0.1%, so the total income tax collected by the IRS went down. Standard deductions were claimed on 68.7% of individual returns. Itemized deductions were claimed on about 30% of 2016 returns,
May
24
2018
24
2018
Interests in Foreign Accounts
U.S. citizens with interests in foreign accounts must generally file a Report of Foreign Bank and Financial Accounts (FBAR), or face penalties. One taxpayer failed to file an FBAR or to pay the IRS-imposed penalty of $1.2 million. The IRS filed suit. Both a U.S. District Court and the U.S. 9th Circuit Court of Appeals rejected her claims that the penalty violated the 8th Amendment of the Constitution (Excessive Fines Clause) and violated treaty provisions.
May
21
2018
21
2018
Tax-Exempt Status Denied
Tax-exempt status was denied. A nonprofit corporation was set up to “deliver quality management consulting services to medical providers and advance government programs through patient safety initiatives.” It was denied tax-exempt status by the IRS and the U.S. Tax Court. The entity wanted to provide low-income housing, “uplifting services for the elderly and veterans” and internal auditing services. The court ruled that it wasn’t eligible for tax-exempt status because it wouldn’t serve the public interest and would solely benefit its founder.
May
17
2018
17
2018
Employment Tax Topics
IRS YouTube videos explain certain employment tax topics. In a series of short videos, the IRS covers payroll-related topics that may be of interest to small business owners. Topics include how to voluntarily correct the classification of employees and when and how to report employment taxes withheld from employee paychecks to the IRS. A third video discusses how the IRS tax calendar can help employers keep track of important tax deadlines. Access the IRS YouTube channel here: https://bit.ly/2HQ12Jy
May
10
2018
10
2018
U.S. Citizens Working Abroad
The IRS has corrected a previous notice that lists housing cost exclusions for U.S. citizens working abroad. Those citizens having a tax home in a foreign country and who meet specific requirements may be able to exclude certain housing costs from their gross income. The excludable amount is the excess of the year’s housing expense over a base amount of $16,624 in 2018 (previously reported as $16,656 in Notice 2018-33). That limit is adjusted for higher cost areas,
Mar
06
2018
06
2018
Watch out for Tax Scams
Be on alert for new tax scams. The IRS is warning about new ways thieves are stealing from taxpayers. In one scam, criminals pose as debt collection agency officials acting on behalf of the IRS. They contact taxpayers to say refunds were deposited in their accounts in error. They ask the taxpayers to send the money back. In another scam, taxpayers receive automated calls saying erroneous refunds were deposited and threatening criminal charges and “blacklisting”
Mar
02
2018
02
2018
Renew 2018 State Licenses or Face Penalty
Businesses urged to renew 2018 State Licenses due January 1 or face penalty.
Feb
27
2018
27
2018
Tax Rules for Alimony
The Tax Cuts and Jobs Act (TCJA) will be changing the tax rules of the road for alimony. Under current rules, individuals who pay alimony or maintenance can deduct an amount equal to the payments made during the year as an “above-the-line” deduction. And, under current rules, alimony and maintenance payments are taxable to recipients. But under the TCJA, there’s no deduction for alimony for the payers and alimony isn’t gross income to the recipients.
