Tax News

May 5, 2019 11:14 pm

One taxpayer who faced a mountain of debts, including more than $9,000 to the IRS and his state’s revenue department, had a plan. He’d withdraw funds from his IRA, place them in his personal back ...

May 5, 2019 11:13 pm

If you itemize deductions that include state and local taxes and then receive a refund related to those taxes in the next year, how much if any of the refund must be included in gross income? The tax ...

March 31, 2019 9:11 pm

The IRS has released its annual list of the top 12 tax scams that taxpayers should avoid (IR-2019-49). They are essential the same as last year, although some scams are featured more prominently than ...

March 31, 2019 9:09 pm

For nearly 70 years, clergy receiving housing (an in-kind benefit) or a housing allowance (a cash benefit) were able to exclude the full amount from gross income. However, the Freedom From Religion Fo...

March 31, 2019 9:07 pm

If you receive a lump-sum payment of Social Security benefits reflecting amounts attributable to prior years, you can elect to use income from the prior years to figure the taxable portion of benefits...

March 31, 2019 9:05 pm

For the second quarter of 2019 (April 1 through June 30, 2019), the IRS interest rate on individual tax refunds and tax underpayments is remaining at 6% (Rev. Rul. 2019-5). This is the same rate that ...

March 31, 2019 9:02 pm

The IRS has responded to public pressure by expanding estimated tax relief for 2018.We earlier reported that in recognition of the extensive changes brought by the Tax Cuts and Jobs Act, the IRS w...

March 3, 2019 9:45 pm

The Tax Cuts and Jobs Act set bonus depreciation for passenger automobiles at 100% (previously it was 50%), which translates into an additional $8,000 write-off for the year they are purchased and pla...

March 3, 2019 9:42 pm

Identity theft of an individual’s personal information can enable a thief to erroneously obtain a taxpayer’s refund and cause delays in the processing of a legitimate tax return. Several years ago...

March 3, 2019 9:39 pm

In her 2018 annual report to Congress, National Taxpayer Advocate Nina E. Olson described the challenges to the IRS resulting from the 35-day government shutdown and recommended additional multi-year ...

March 3, 2019 9:35 pm

When the IRS executed a search warrant at the home of “plaintiffs,” agents seized 364 boxes of rolled $1 presidential coins, each containing 1,000 coins. The armored truck company that transported...

March 3, 2019 9:32 pm

Transfers from one spouse to another related pursuant to a divorce or separation agreement are tax-free transfers. The transferring spouse does not pay tax on any gain; the transferee-spouse takes ove...

March 3, 2019 9:28 pm

A couple bought a home but wanted to demolish it and rebuild on the same property. Instead of simply tearing it down, they arranged with a charity to “deconstruct” it in order to give the charity...

March 3, 2019 9:08 pm

Several years ago, the U.S. Supreme Court said heirs who inherited IRAs could not protect these assets under the federal Bankruptcy Code when they filed for bankruptcy (Clark v. Rameker, S.Ct., 573 U....

March 3, 2019 9:06 pm

Because of the number of changes in the rules for 2018 triggered by the Tax Cuts and Jobs Act, the IRS is waiving estimated tax penalties for certain individuals (IR-2019-03, 1/16/19). Usually, there...

January 4, 2019 1:14 am

While the Tax Cuts and Jobs Act repealed the individual mandate penalty as of January 1, 2019, the requirement for individuals and their dependents to have minimum essential health coverage unless exe...

January 4, 2019 1:12 am

The IRS has announced the standard mileage rates for certain types of driving in 2019 (Notice 2019-02). Beginning on January 1, 2019, the standard mileage rates for the use of a car, van, pickup or pa...

January 4, 2019 1:10 am

Unless a taxpayer can demonstrate a profit motive, an activity is treated as a hobby. This means all income must be reported, but for 2018 through 2025, no deductions can be taken. The bar to deductio...

January 4, 2019 1:08 am

Life’s ups and downs can disrupt things for taxpayers, but the Tax Court has made it clear that it’s no excuse for not filing tax returns. Take the following case where a taxpayer who worked in th...

January 4, 2019 1:06 am

The interest rates on overpayments and underpayments are increased slightly for the first quarter of 2019, as compared with the rates for the prior quarter (Rev Rul. 2018-32). The rates are:Nonco...

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Tax Glossary

Original issue discount (OID)

The difference between the face value of a bond and its original issue price. OID is reported on an annual basis as interest income.

More terms