AICPA Tax Insider (July 22, 2021): What to do for a missed Sec. 83(b) election; ARPA expands tax credits for families; and More!

What to do for a missed Sec. 83(b) electionBy T.J. Wilkinson J.D., LL.M.All is not lost if a taxpayer hasn't made the Sec. 83(b) election, which often comes up in relation to stock or other equity received as compensation and subject to vesting. ARPA expands tax credits for familiesBy Nell Adkins, CPA, Ph.D., and Charlene … Continue reading AICPA Tax Insider (July 22, 2021): What to do for a missed Sec. 83(b) election; ARPA expands tax credits for families; and More!

IRS Updates Practice Unit on Computing Qualified Research Expenses (April 22, 2021)

The IRS has updated its practice unit on Computing Qualified Research Expenses. The overview is as follows: Examining the credit for increasing research activities under IRC 41 (research credit) involves significant resources of both taxpayers and the Internal Revenue Service. Taxpayers following U.S. Generally Accepted Accounting Principles (GAAP) for book, use Accounting Standards Codification (ASC) … Continue reading IRS Updates Practice Unit on Computing Qualified Research Expenses (April 22, 2021)

IRS Updates Practice Unit on Foreign-Derived Intangible Income (June 28, 2021)

The IRS has updated its practice unit on Foreign-Derived Intangible Income (FDII). The overview is as follows: The Tax Cuts and Jobs Act enacted section 250, which provides for a deduction with respect to Global Intangible Low-Taxed Income (GILTI) and Foreign-Derived Intangible Income (FDII). The deduction is only available to domestic corporations (except that the … Continue reading IRS Updates Practice Unit on Foreign-Derived Intangible Income (June 28, 2021)

AICPA Tax Insider (July 15, 2021): Addressing the rock bottom IRS service levels; Proposed bill to regulate tax preparers has AICPA support; and More!

Addressing the rock bottom IRS service levelsBy Edward S. Karl, CPA, CGMAThe AICPA surveyed members to statistically validate what we hear daily about IRS service levels, then came up with some tips to help the agency improve. Proposed bill to regulate tax preparers has AICPA supportA bill recently proposed in Congress would authorize Treasury to … Continue reading AICPA Tax Insider (July 15, 2021): Addressing the rock bottom IRS service levels; Proposed bill to regulate tax preparers has AICPA support; and More!

The IRS Website Offers The 24/7 summertime spot for tax help (July 9, 2021)

The IRS website provides millions of visitors with the answers they need to fit their busy summer schedules. On IRS.gov, waiting for service is not a problem and no appointment is needed to use the online tools. Many taxpayers who requested an extension to October 15 or missed the May 17 deadline can still prepare and … Continue reading The IRS Website Offers The 24/7 summertime spot for tax help (July 9, 2021)

IRS Released The Art Advisory Panel of the Commissioner of Internal Revenue for FY 2020

The IRS released publication 5392, The Art Advisory Panel of the Commissioner of Internal Revenue, summarizing the closed meeting activities of the Art Advisory Panel during fiscal year 2020. The Panel provides valuation recommendations on artwork involved in estate, gift, and income tax returns. Due to the Covid-19 pandemic, the Fine Arts Panel met only … Continue reading IRS Released The Art Advisory Panel of the Commissioner of Internal Revenue for FY 2020

Rev. Rul. 2021-12: July 2021 AFRs

The IRS has released Rev. Rul. 2021-12, which provides various prescribed rates for federal income tax purposes for July 2021 including short-term, mid-term, and long-term applicable federal rates (AFR) for the current month for purposes of section 1274(d) of the Internal Revenue Code and more. To see Rev. Rul. 2021-12: Determination of Issue Price in … Continue reading Rev. Rul. 2021-12: July 2021 AFRs

Treasury Department and IRS: Mandatory 60-Day Postponement of Certain Tax-Related Deadlines by Reason of a Federally Declared Disaster (June 11, 2021)

The U.S. Treasury Department and IRS have released for publication in the Federal Register final regulations (T.D. 9950) relating to a mandatory 60-day postponement of certain time-sensitive tax-related deadlines by reason of a federally declared disaster. The final regulations provide guidance for individuals who reside in, were injured or killed in a disaster area; businesses … Continue reading Treasury Department and IRS: Mandatory 60-Day Postponement of Certain Tax-Related Deadlines by Reason of a Federally Declared Disaster (June 11, 2021)

IRS Memorandum 202118008: Commutation of QTIP Trust Resulted in Gifts (February 1, 2021)

In IRS Memorandum 202118008, the Office of Chief Counsel has ruled that a surviving spouse was treated as making a gift of all of the interests in a qualified terminable interest property (QTIP) trust other than the qualifying income interest when the trust was commuted. The conclusion is as follows: The commutation of the trust is … Continue reading IRS Memorandum 202118008: Commutation of QTIP Trust Resulted in Gifts (February 1, 2021)

EY Tax News Update: Revenue proposals detailed in Treasury Green Book would significantly affect international private companies and families (July 2, 2021)

EY has made available for download their Tax News Update 2021-1317, “Revenue proposals detailed in Treasury Green Book would significantly affect international private companies and families”. The abstract is as follows: In its FY2022 budget and explanation of revenue proposals (Treasury Green Book), the Biden Administration proposed numerous tax changes that would increase taxes on international private … Continue reading EY Tax News Update: Revenue proposals detailed in Treasury Green Book would significantly affect international private companies and families (July 2, 2021)

Clark v. Commissioner: Tax Court’s Summary Judgment on Limitation Period of FPAA Affirmed

In Clark v. Commissioner, the Court of Appeals for the Ninth Circuit affirmed the Tax Court’s summary judgment because the IRS’s final partnership administrative adjustment (FPAA) of an entity’s partnership return for a tax year at issue was issued outside of the applicable three-year limitation period. The taxpayer’s motion for summary judgment with respect to … Continue reading Clark v. Commissioner: Tax Court’s Summary Judgment on Limitation Period of FPAA Affirmed

AICPA Tax Insider (July 1, 2021): IRS warns of pandemic-related tax scams in ‘Dirty Dozen’ for 2021; SBA may be dropping PPP Loan Necessity Questionnaire requirement; and More!

IRS warns of pandemic-related tax scams in 'Dirty Dozen' for 2021Hijacking of economic impact payments and unemployment checks are spotlighted in the IRS's annual alert, which warns taxpayers of the most prevalent scams and schemes the Service has identified. SBA may be dropping PPP Loan Necessity Questionnaire requirementIndications are that businesses with Paycheck Protection Program … Continue reading AICPA Tax Insider (July 1, 2021): IRS warns of pandemic-related tax scams in ‘Dirty Dozen’ for 2021; SBA may be dropping PPP Loan Necessity Questionnaire requirement; and More!

Rev. Proc. 2021-14: Special elections for taxpayers with Farming Loss NOLs

The IRS has released Rev. Proc. 2021-14 which prescribes when and how to make an election with regard to all NOLs of the taxpayer, regardless of whether the NOL is a Farming Loss NOL. This revenue procedure also provides that a taxpayer is treated as having made a deemed election under § 2303(e)(1) of the … Continue reading Rev. Proc. 2021-14: Special elections for taxpayers with Farming Loss NOLs

IRS Updates Concept Unit on Allocation Methods of Personal Use of Aircraft (June 21, 2021)

The IRS has updated its concept unit on Allocation Methods of Personal Use of Aircraft. The overview is as follows: Taxpayers who use their own aircraft for both business and personal flights must allocate expenses to each category. Personal flight expenses are further allocated between personal entertainment flights and personal non-entertainment flights but making that … Continue reading IRS Updates Concept Unit on Allocation Methods of Personal Use of Aircraft (June 21, 2021)

IRS Memorandum 20211701F: Field Attorney Advice on Micro-Captive Transactions Issued (April 30, 2021)

In IRS Memorandum 20211701F (April 30, 2021), the IRS Chief Counsel ruled that the variant of the micro-captive insurance transactions promoted by an entity were the same as, or substantially similar to, the transaction of interest described in Notice 2016-66 , I.R.B. 2016-47, 745. The Chief Counsel analyzed the taxpayer’s situation by applying the five factors … Continue reading IRS Memorandum 20211701F: Field Attorney Advice on Micro-Captive Transactions Issued (April 30, 2021)

Edward T. Killen: Further Extended Modification of Exam Activity (June 28, 2021)

Edward T. Killen, the Deputy Commissioner of Tax Exempt & Government Entities Division, has released memorandum that supersedes the previous memorandum issued on December 15, 2020, entitled, “Extended Modification of IDR Enforcement Timelines due to COVID-19 Considerations and Resumption of Exam Activity”. It extends the guidance regarding resumption of TE/GE exam activities post July 15, … Continue reading Edward T. Killen: Further Extended Modification of Exam Activity (June 28, 2021)

Kelly v. Commissioner, T.C. Memo. 2021-76 (June 28, 2021): Fund Transfers Were Distributions Valued at Face Amounts

In consolidated cases, fund transfers were not loans but rather distributions valued at the face amounts. The taxpayer (1) bought and sold companies; (2) flipped loans; and (3) started his limited liability company (K1). The transfers were made to K1 and analyzed on being either bona fide loans or distributions. However, the taxpayer received other … Continue reading Kelly v. Commissioner, T.C. Memo. 2021-76 (June 28, 2021): Fund Transfers Were Distributions Valued at Face Amounts

TOT Property Holdings, LLC v. Commissioner of IRS: Tax Court Properly Determined Noncompliance with Extinguishment Proceeds Requirement

The Tax Court correctly determined that an entity did not comply with extinguishment proceeds requirement in a deed. The deed was not saved by the disputed provisions because they constituted an unenforceable condition-subsequent savings clause. The deed donated for conservation purposes, an easement encumbering the taxpayer’s property. It also contained a formula for the distribution … Continue reading TOT Property Holdings, LLC v. Commissioner of IRS: Tax Court Properly Determined Noncompliance with Extinguishment Proceeds Requirement

KPMG report: Tax provisions for asset management industry in Biden Administration’s FY 2022 budget proposals (June 29, 2021)

KPMG is reporting that the U.S. Treasury Department on May 28, 2021, released the “General Explanations of the Administration’s Fiscal Year 2022 Revenue Proposals”—the “Green Book.” The Green Book describes the Biden Administration’s tax proposals in connection with its proposed budget, and provides additional details with respect to these proposed tax provisions. This booklet highlights revenue … Continue reading KPMG report: Tax provisions for asset management industry in Biden Administration’s FY 2022 budget proposals (June 29, 2021)