Tax Planning for 2024

As you file your 2023 tax return, start thinking about how you can boost itemized deductions for 2024. You may be able to “bunch” medical expenses so you exceed the 7.5% of adjusted gross income necessary to deduct some costs. Say, for example, you’ve already scheduled surgery that will involve out-of-pocket expenses but still fall […]

Guidance issued on Pension-Linked Emergency Savings Accounts

IRS notice 2024-22 provides anti-abuse guidance to employers that offer the new pension-linked emergency savings accounts (PLESAs). The procedures are intended to prevent participants from manipulating rules to cause excessive matching contributions. According to the IRS, a reasonable policy balances PLESA participants’ interests with the plan sponsor’s interest in preventing manipulation of matching contribution rules. […]

Liquidity overload: Why having too much cash may be bad for business

In today’s uncertain marketplace, many businesses are stashing operating cash in their bank accounts, even though they might not have imminent plans to deploy their reserves. However, excessive “rainy day” funds could be an inefficient use of capital. Here’s a systematic approach to help estimate reasonable cash reserves and maximize your company’s return on long-term […]

How is the IRS using the increased funding it received?

Recent analysis from the U.S. Dept. of Treasury and the IRS shows that the additional funding provided to the IRS under the Inflation Reduction Act (IRA) can increase overall revenues by nearly $561 billion through fiscal year 2034. This amount is substantially more than the previously estimated amount of $390 billion over the next 10 […]

IRS issues fact sheet on 1099-K

Late last year, the IRS announced a delay in releasing the Form 1099-K, Payment Card and Third Party Network Transactions, $600 reporting threshold for third-party settlement organizations. These include payment apps and online marketplaces. As a result, for 2023, reporting generally isn’t required unless a taxpayer receives more than $20,000 and has more than 200 […]

How much should you spend on wedding gifts?

What is jointly and severally liable?

Spouses who file a joint federal tax return are both generally liable for the tax owed. But joint filers may be eligible for “innocent spouse” relief that shields them from liability. One taxpayer argued that if she paid the taxes owed, she’d suffer economic hardship. Her annual income, she said, was far below the poverty […]

Address Change?

Did your address change in 2023? If so, it’s important to notify the IRS of your correct address for your home or business. You can easily inform the IRS of changes to your home address by filing Form 8822 or Form 8822-B to change your business address. You can also make the change by calling […]

Reporting Cash transactions

A reminder for businesses: Use IRS Form 8300 to report cash transactions of $10,000 or more within 15 days of a transaction. If you file electronically, forms are delivered to the Financial Crimes Enforcement Network. Paper forms are submitted to the IRS. You also generally should provide written statements to parties whose names you’ve reported […]

Captive Insurance Company loses in Tax Court

When businesses owned by a married couple supplemented traditional insurance with “microcaptive” policies from companies the husband controlled, the IRS called foul. The tax agency said these policies were used to claim deductions and avoid paying tax. The Tax Court agreed. It ruled, among other things, that the taxpayers failed to show their captive policies […]