Is the settlement taxable?

Tax law excludes from “gross income” damages received in a legal action for “personal physical injuries or physical sickness,” if certain conditions are met. There must be a “direct causal link” between the damages and the injury. In one case, the U.S. Tax Court ruled that married taxpayers weren’t entitled to income exclusion for a […]

Mississippi filing relief

The IRS is providing tax relief to victims of the Mississippi water crisis, effective Aug. 30, 2022. You qualify for relief if you reside or have a business in Hinds County. Affected individuals and businesses now have until Feb. 15, 2023, to file returns and pay any taxes that were originally due during the relief […]

Where Do People Pay the Most in Property Taxes?

Where Do People Pay the Most in Property Taxes? https://bit.ly/3RMLV7X

Tax rules regarding remote work arrangements

Tax rules regarding remote and hybrid work arrangements need updating. That’s what theAmerican Institute for Certified Public Accountants (AICPA) is telling the IRS and Treasury Department. The AICPA claims that existing revenue rulings and case law interpretations don’t reflect the fact that many workers now consider their homes their “principal place of business.” This makes […]

Data Exposed

Tax-exempt organizations take note: Some of your tax data may have been publicly exposed. On Sept. 2, the IRS admitted it erroneously released some Form 990-T information via its Tax Exempt Organization Search (TEOS) tool. Form 990-T is used by not-for-profits to report income unrelated to their exempt purpose. Fortunately, the disclosed information didn’t include […]

Year-end tax planning ideas for your small business

Now that Labor Day has passed, it’s a good time to think about making moves that may help lower your small business taxes for this year and next. The standard year-end approach of deferring income and accelerating deductions to minimize taxes will likely produce the best results for most businesses, as will bunching deductible expenses […]

Offshore accounts and assets

The use of shell banks, along with limited tax law enforcement, has enabled tax evasion by wealthy individuals through offshore financial accounts and assets, according to a recent Senate Finance Committee report. Committee Chair Ron Wyden (D-OR) noted that the Foreign Account Tax Compliance Act (FATCA) is aimed at cracking down on tax evasion by […]

Failure to file penalty

The IRS recently provided relief from the failure-to-file penalty for taxpayers who missed the filing deadlines for certain 2019 and/or 2020 tax and information returns. The penalty is typically assessed at a rate of 5% per month and up to 25% of the unpaid tax when a federal income tax return is filed late. To […]

Is your income high enough to owe two extra taxes?

High-income taxpayers face two special taxes — a 3.8% net investment income tax (NIIT) and a 0.9% additional Medicare tax on wage and self-employment income. Here’s an overview of the taxes and what they may mean for you. 3.8% NIIT This tax applies, in addition to income tax, on your net investment income. The NIIT […]

Cryptocurrency regulation proposed

Bipartisan legislation to regulate cryptocurrencies has been submitted in the U.S. Senate. The Responsible Financial Innovation Act would set new tax rules for cryptocurrencies and shift much of their oversight to the Commodity Futures Trading Commission. The bill was submitted by Sen. Kirsten Gillibrand (D-NY) and Sen. Cynthia Lummis (R-WY). It would create a de […]