2016-09-12 Justified Paranoia

This is Current Federal Tax Developments for the week of September 12, 2016 - Justified Paranoia, recorded from my hotel room outside Newark Liberty International Airport this week.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• IRS announces two dozen preparer’s systems have been cormpromised for ID theft
• A non-tax motivated grouping can’t be changed by the IRS
• Income from forfeited deposit on purchase of building used in business is ordinary income
• A request to re-elect S status early is denied by the IRS
• Court analyzes whether advances to S corporation were loans or capital contributions
• Taxpayer discovers limits of relief provision for IRA overcontributions
• Court of Appeals finds TEFRA doesn’t block managing partner from raising reasonable cause defense disallowed at partnership level

The audio version of this week's broadcast can be streamed or downloaded below.

The articles for this weeks development are available for download at the link below;

• 2016-09-12 Current Federal Tax Developments

2016-09-06 Old Court Cases Get Another Look

This is Current Federal Tax Developments for the week of September 6, 2016 - Old Court Cases Get Another Look. Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• IRS to start notifying taxpayers of employment related ID theft
• Taxpayer finds buying a computer didn’t qualify for American Opportunity Tax Credit
• Ninth Circuit upholds Shea Homes case on appeal
• IRS decides Coverdell ESAs subject to same rollover limits as traditional IRAs
• Regulations finalized on post Obergefell and Windsor definition of marriage

The audio session can be streamed or downloaded below

A PDF with the articles for the cases discussed this week can be downloaded below.

• 2016-09-06 Current Federal Tax Developments

August 29, 2016 - Stop Asking Us for Letters

This is Current Federal Tax Developments for the week of August 29, 2016 - Stop Asking Us For Letters.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• IRS offers an option for signing up for secure services online other than a postpaid cell phone
• Installment agreements are likely to become more costly to enter into - unless it’s all done online
• The Sharing Economy Tax Center created by the IRS
• The IRS creates a greatly expanded option to obtain late IRA/qualified plan rollover relief without requiring a letter ruling
• Poor records cause taxpayer to be taxed on all distributions of S corporation as in excess of basis
• Average monthly bronze premiums for 2016 for individual shared responsibility payments released

This week's audio can be either streamed via the link below or downloaded to your system.

Articles related to this week's broadcast are found in the following PDF file.

• 2016-08-29 Current Federal Tax Developments

August 22, 2016 - Being Reasonable

This is Current Federal Tax Developments for the week of August 22, 2016 - Courts Tell IRS to Be Reasonable.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• A taxpayers finds no deduction allowed because she hadn’t begun a business
• IRS wins, but most likely ends up having given taxpayer an additional deduction
• An email looks at the employment status of adult companions
• A partnership had reasonable cause for late filing due to extremely unreliable information on its only investment
• §501(c)(3) corporation still subject to lower large corporation interest on overpayment
• A taxpayers mistake regarding year of deduction provided reasonable cause for late filing

An audio only version can be streamed or downloaded below

The articles for the topics discussed this week can be found in the PDF file listed below.

• 2016-08-22 Current Federal Tax Developments

August 15, 2016 - Seeing if the Phish Will Bite

This is Current Federal Tax Developments for the week of August 15, 2016 - Seeing if Phish Will Bite.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• IRS issues phishing attack masquerading as tax software update being aimed at preparers
• IRS agents ordered not to initiate contact via phone in another situation
• A taxpayer discovers divorce decree determination for claiming exemption irrelevant for federal taxes
• A real estate professional discovers the difference between “not automatically passive” and “materially participating”
• Relief granted to CRATs due to low interest rates
• The Tax Court looks to form over substance in reverse §1031 exchange
• IRS gives guidance on ITIN changes imposed by PATH--and modifies a difficult to administer portion of the Act

An audio version of this week's update can be streamed or downloaded below.

A PDF containing all articles for the items discussed this week is available below.

• 2016-08-15 Current Federal Tax Developments

August 8, 2016 - The IRS Strikes Back

This is Current Federal Tax Developments for the week of August 8, 2016 - The IRS Strikes Back.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• AICPA has its turn to lose in court over IRS voluntary preparer licensing program
• An accountant losing his job didn’t cost him a deduction for an MBA degree
• IRS throws in the towel regarding home mortgage interest deductions for unmarried couples
• While a bankruptcy estate owned income taxes on income that was part of the estate, the debtor had to pay the self-employment tax
• The IRS attempts to bring the §2704 hammer back from the ashes
• The IRS decides to kick the can down the road on the new partnership audit rules by allowing an early “opt-in” decision to be made only after the notice of exam

The audio for the update can be streamed or downloaded below.

You can download a PDF with the articles for this week from the link below.

• 2016-08-08 Current Federal Tax Developments

August 1, 2016 - The Cost of Doing the Right Thing

This is Current Federal Tax Developments for the week of July 25, 2016 - The Cost of Doing the Right Thing.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following::

• Online poker site isn’t a financial institution
• IRS formally reduces the paperwork associated with an §83(b) election
• Network and not sports league can get §199 deduction
• Draft of expanded preparer due diligence form released by IRS
• Paying laid off employee’s final payroll exposed CEO to trust fund penalty (moral - nice guys pay all the bills)

The audio version of this week's update can be downloaded below or you can listen to it online.

This week's articles in PDF form can be downloaded below:

• 2016-08-01 Current Federal Tax Developments

July 25, 2016 - Fraud and Changing Procedures

This is Current Federal Tax Developments for the week of July 25, 2016 - Fraud and Changing Procedures.  Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following:

• IRS restarts program to allow obtaining replacement IP PINs online-but many may not be able to use it
• Letters will be sent before the IRS contacts employers for federal tax deposit alerts
• Do you need to own oil and gas properties to claim the benefits of the rapid write off of geological and geophysical expenses?
• IRS creates safe harbors that apply to certain transactions attempting to meet the requirements for a tax free distribution under §355
• The word “excessive” does not include what might be considered “unfair” interest
• Taxpayer tries to block imposition of pre-notice interest on transferee liability

The audio only version of this week's broadcast can be streamed online or downloaded for listening offline via the link below:

You can download a PDF with this week's articles below:

• 2016-07-25 Current Federal Tax Developments

July 18, 2016 - Late is Not Always Better Than Never

This is Current Federal Tax Developments for the week of July 18, 2016 - Late Isn’t Better Than Never Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following::

• Ninth Circuit finds a way to decide a discharge of tax liability in bankruptcy case without visiting the question of whether a late filed return ever can have its liability discharged
• Department of Labor and IRS announce significant proposed revisions to Forms 5500
• The birth of a child was an unforeseen circumstance in the view of the IRS
• A state court couldn’t fix a decedent’s significant IRA planning error
• IRS issues the §501(c)(4) notice rules

The audio for this week is available below.

The articles for this week's podcast can be downloaded as a PDF below:

• 2016-07-18 Current Federal Tax Developments

July 11, 2016 - Data Attack

This is Current Federal Tax Developments for the week of July 11, 2016 - Data Attack Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following::

• IRS Warns Preparers to Be Aware of Data Loss
• Proposed Regulations on Health Care Credit Provide Design for “Opt-Out” Programs
• What Doesn’t Work in Proving Equitable Ownership of a Residence
• Court of Appeals Agrees Working Interest Owners Are Subject to Self-Employment Tax Under Partnership Rules
• IRS Explains to the Court How It Applied a Refund Before It Received the Return

You can download a PDF with the articles for this week's topics below:

2016-07-11 Current Federal Tax Developments

July 5, 2016 - Crowdsourcing and Taxes

This week we’ll look at the following::

• Security Summit 2016 report issued - and preparer security is an issue
• The interaction between crowdsourcing and taxes discussed in an IRS letter
• A taxpayer’s testimony was enough for the Tax Court to find him insolvent
• The IRS didn’t find the taxpayer’s medical claim believable for a late IRA rollover
• The Night Circuit finds Congress intended for the Tax Court to do more than just contemplate the statute of limitations for a partner
• The Federal Circuit outlines when changes in a consolidated group will affect interest netting.

The audio only version can be found (and downloaded if you like) below.

The materials for this week's session can be downloaded below:

2016-07-05 Current Federal Tax Developments

June 27, 2016 - Unforgivable Errors

Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following::

• IRS has to shut down electronic filing PIN program yet again
• Taxpayer’s mistake in dealing with inherited annuity can’t be fixed
• No documentation, no charitable deduction
• Proposed regulations on deferred compensation arrangements on which taxpayers may rely
• Taxpayer who went ahead with transaction despite warnings from two advisers finds ignoring the advice is costly

Materials related to this week's podcast can be downloaded below.

• 2016-06-25 Current Federal Tax Developments

June 20, 2016 - Consistency is the Hobgoblin of Taxes

This is Current Federal Tax Developments for the week of June 20, 2016 - Consistency is the Hobgoblin of Taxes. Current Federal Tax Developments is brought to you by the state CPA societies and Nichols Patrick CPE, Incorporated.

This week we’ll look at the following::

• The duty of consistency requires one more year of wrong reporting
• IRS details how to obtain a refund of taxes on wrongful incarceration damages
• The IRS National Office discusses limits on the success based fees safe harbor method
• The Tax Court finds a transfer related to the cessation of the marriage does not have to be in the divorce document
• LLC operating agreement’s boilerplate partnership language gets in the way of an S election
• The Tax Court still believes a preparer’s fraud keep the statute open on the taxpayer’s return

A PDF filed containing articles on all of the topics discussed can be downloaded below:

• 2016-06-20 Current Federal Tax Developments

June 13, 2016 - But I Don't Like That Answer

This week we’ll look at the following::

• Online transcript program restarts
• IRS gives some real estate developers bad news
• IRS finalizes regulations on cancellation of debt and disregarded entities
• Opinion shopping is costly to a holder of a life insurance policy
• CPEO application process detailed

Current Federal Tax Developments is brought to you by your state society of CPAs and Nichols Patrick CPE, Incorporated

You can download the articles for items discussed in this week's show from the link below.

• 2016-06-13 Current Federal Tax Developments

June 6, 2016 - But We Saved So Much Money Not Paying for Tax Advice

This week we’ll look at the following::

• Paying employees as wellness program incentive is a taxable event
• IRS rules an estate settlement will be taxing to the heir who gives up right to property
• A taxpayer ends up paying tax twice on the same income
• Sanctioned preparer’s work in preparing others returns did now his return should be subject to fraud penalty on understatements
• IRS agrees LLC can make initial election long after it was formed

Current Federal Tax Developments is brought to you by your state society of CPAs and Nichols Patrick CPE, Incorporated.

A PDF with the information for this week's developments is available below.

• 2016-06-06 Current Federal Tax Developments

May 31, 2016 - Maybe Students Don't Know Better

This week on Current Federal Tax Developments we look at the following:

• Phone Scammers Create a Brand New Tax To Be Paid With Their Prepaid Debit Card
• IRS Formalizes a First Contact Via Mail Rule for Audits
• User Fees for Form 1023-EZ to Drop in July
• Why a Mary Kay Salesperson Isn’t Like an Insurance Agent

Current Federal Tax Developments is brought to you by your state society of CPAs and Nichols Patrick CPE, Incorporated

A PDF write-up of the issues discussed is available for download below.

• 2016-05-31 Current Federal Tax Developments

May 23, 2016 - There's Always a Gotcha

Due to my travel to Toronto beginning on Friday, I'm actually recording this on Thursday rather than the normal Saturday date.

This week on Current Federal Tax Developments we look at the following:

• New attorney loses his attempt to get nearly 50 year old regulation declared invalid by Tax Court
• Designated Roth IRAs can now be more easily rolled over
• There’s Always a Gotcha - Taxpayer discovers that text that told him gain wasn’t taxable in treaty overridden by text elsewhere in the treaty
• When the IRS takes your money to pay a debt another agency claims you owe, don’t ask the IRS or Tax Court to solve your issue with that agency
• Legal marijuana sellers get the ability to obtain offers in compromise -- but, again with a gotch a

Current Federal Tax Developments is brought to you by your state society of CPAs and Nichols Patrick CPE, Incorporated

The text of articles for the developments discussed this week is available in PDF form below.

• 2016-05-23 Current Federal Tax Developments

May 16, 2016 - Stop Phoning It In

For this week of May 16, 2016 in Current Federal Tax Developments we look at:

• IRS stops phoning it in 
• Salaries and payments to related parties are both found reasonable in a Tax Court case
• The Third Circuit disagrees with the Tax Court on the all events test and a fuel rewards program
• A trust is denied litigation costs because it’s value exceeded the limits in a transferee liability case
• The IRS rolls out some guidance on Certified PEO program

Current Federal Tax Developments is brought to you by the state societies of CPAs and Nichols Patrick Incorporated

The articles for this week's update can be found in the PDF you can download below.

• Current Federal Tax Developments May 16, 2016

May 9, 2016 - Fire the Partners!

For this week of May 9, 2016 in Current Federal Tax Developments Don Cochran, JD, CPA joins Ed Zollars, CPA to discuss the following developments:

• IRS “fires” partners who are employees of disregarded entities
• Spouse gets innocent spouse relief even though all income was from his business
• IRS gives relief when need for QSST election after merger not realized
• New comprehensive list of automatic accounting method changes issued

Current Federal Tax Developments is brought to you by the state societies of CPAs and Nichols Patrick Incorporated.

A PDF file containg the articles for the items discussed in this week's podcast can be downloaded below.

• Current Federal Tax Developments - May 9, 2016

May 2, 2016 - IRS and the High Seas

For this week of May 2, 2016 in Current Federal Tax Developments we look at:

• The IRS’s reach extends to the high seas
• Another conservation easement deduction bites the dust
• HSA limits for 2017 come out and little changes
• After a series of errors, the IRS grants a taxpayer permission to undo an larger than desired Roth IRA conversion
• California’s donor disclosure law, constitutional on its face, found to not be constitutional due to botched execution by the state
• We will one more year of not having the information we need on Forms 1098Ts as educational institutions given relief from PATH law change

Current Federal Tax Developments is brought to you by the state societies of CPAs and Nichols Patrick Incorporated

The audio only version can be played by clicking the triangle below, or downloaded for offline listening via the download link.

A PDF of the articles on the topics discussed this week can be downloaded below:

• 2016-05-02 Current Federal Tax Developments