Tax News

January 8, 2020 1:16 am

Executive Order 13765, issued in 2017, is aimed at minimizing the economic burden of the Affordable Care Act. However, the IRS has indicated that this doesn’t give the Service the authority to chang...

January 8, 2020 1:14 am

The interest rates on overpayments and underpayments are unchanged from the fourth quarter of 2019 (Rev Rul. 2019-28). The rates are:Noncorporate overpayments and underpayments: 5% Corporate ov...

January 8, 2020 1:12 am

The IRS has provided guidance on what disclosure is treated as “adequate” to avoid a 20% penalty for a substantial understatement of tax (Rev. Proc. 2019-42, updating Rev. Proc. 2019-9). Here’s ...

January 8, 2020 1:10 am

A domestic spending package, called the Further Consolidated Appropriations Act, 2020 (H.R. 1865) which was signed into law on December 20, 2019, makes $426 billion in tax cuts. Here is a brief overvi...

November 25, 2019 10:28 pm

Currently, the estate tax exemption is large enough ($11.4 million for decedents dying in 2019; $11.5 million for those dying in 2020) to protect most estates from having to pay any federal estate tax...

November 25, 2019 10:26 pm

The basic Part B premium amount for 2020 is $144.60 per month. The Part D premium for drug coverage in 2020 ranges from $13 to $83 per month (depending on the drug plan selected). However, high-income...

November 25, 2019 10:23 pm

A home office deduction can be claimed only if space is used regularly and exclusively for business. But can a taxpayer who has two businesses claim a home office deduction for the same space?In a...

November 25, 2019 10:21 pm

Homeowners who meet ownership and use tests can exclude gain on the sale of a principal residence up to $250,000 ($500,000 on a joint return). Taxpayers who hold property for investment can defer gain...

November 25, 2019 10:20 pm

Each year, the IRS can adjust various amounts used to figure contributions, benefits, deductions, and credits related to qualified retirement plans and IRAs. The IRS has now done so for 2020 amounts (...

November 25, 2019 10:18 pm

The IRS has announced cost of living adjustments for more than 60 tax items for 2020 Act (Rev. Proc. 2019-44). All of the tax brackets have been affected, as well as the taxable income breakpoints for...

November 3, 2019 8:25 pm

More than 69 million Social Security beneficiaries will receive a cost-of-living adjustment (COLA) of 1.6% starting with the December 2019 benefits, which are payable in January 2020. This COLA adjust...

November 3, 2019 8:23 pm

ABLE accounts are special savings accounts for certain disabled individuals that can be used without causing the loss of government benefits related to the disability. In 2018, the IRS indicated it wo...

November 3, 2019 8:21 pm

In 2014, the IRS said that virtual currency, such as Bitcoin, is property and not currency (Notice 2014-21). Thus, individuals receiving payments in cryptocurrency held for investment means reporting ...

October 6, 2019 11:04 pm

For owners of pass-through entities to claim the 20% qualified business income (QBI) deduction, they must be in a trade or business. When it comes to real estate activities, it’s sometimes difficult...

October 6, 2019 10:58 pm

A wife was ordered by a divorce decree to transfer $10,000 from her retirement account  to her former husband. She instructed her broker to transfer this amount to an IRA set up for the former husban...

October 6, 2019 10:57 pm

A high school senior with a perfect attendance record and good grades was entered by the school into a “Strive to Drive” drawing held by a local car dealership. She won a Jeep Renegade valued at o...

October 6, 2019 10:55 pm

The IRS has announced that the interest rates applicable to overpayments and underpayments of federal taxes for the fourth quarter of 2019 are the same as for the third quarter of the year (Rev. Rul. ...

October 6, 2019 10:53 pm

Compensatory damages received for a personal physical injury or sickness are excludable from gross income. Damages for any other personal reason, such as defamation, as well punitive damages for any r...

September 3, 2019 9:09 pm

In certain situations, an employer is required to distribute funds held in the company’s retirement plan, after withholding 20%. But what happens if the individual fails to cash the check?The IR...

September 3, 2019 9:08 pm

Because of changes made by the Tax Cuts and Jobs Act, many taxpayers didn’t pay enough in income taxes through withholding and estimated tax payments to satisfy the safe harbors for avoiding  estim...

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Tax Glossary

Acquisition debt

Debt used to buy, build, or construct a principal residence or second home and that generally qualifies for a full interest expense deduction.

More terms