OECD is working on global tax regime

The Organization for Economic Co-operation and Development (OECD) is working with the U.S. Treasury Dept. to release guidance on its global minimum tax regime. The guidance will address the treatment of global intangible low-taxed income (GILTI) and certain tax credits. As the OECD’s second “pillar” of its Global Anti-Base Erosion Rules, which imposes a 15% […]

Many tax limits affecting businesses have increased for 2023

An array of tax-related limits that affect businesses are indexed annually, and due to high inflation, many have increased more than usual for 2023. Here are some that may be important to you and your business. Social Security tax The amount of employees’ earnings that are subject to Social Security tax is capped for 2023 […]

SDTD status can put your passport at risk

Seriously delinquent tax debt (SDTD) could put your passport at risk (unless an exception applies). In 2023, SDTD is an unpaid federal tax assessment exceeding $59,000, where a lien has been filed and other remedies have been exhausted. If such conditions exist, the U.S. State Dept. can deny, revoke or limit a passport. One taxpayer […]

Glitch in tax bill stops catch-up contributions

A glitch in the recently passed SECURE 2.0 Act involving catch-up contributions has been uncovered. A trade group, the American Retirement Association, noticed a technical error and has alerted the U.S. Treasury Dept. and the Joint Committee on Taxation (JCT), which are studying how to correct it. The law was supposed to allow certain taxpayers […]

Retirement plan early withdrawals: Make sure you meet the requirements to avoid a penalty

Most retirement plan distributions are subject to income tax and may be subject to an additional penalty if you take an early withdrawal. What’s considered early? In general, it’s when participants take money out of a traditional IRA or other qualified retirement plan before age 59½. Such distributions are generally taxable and may be subject […]

Are you eligible for refundable credits?

The IRS estimates that 80% of taxpayers who are eligible for the Earned Income Tax Credit actually claim it. But that leaves 20% who don’t. Many people also leave the Child Tax Credit, Additional Child Tax Credit, Credit for Other Dependents and American Opportunity Tax Credit on the table. To help reach these taxpayers, the […]

CRS issues report on small company tax provisions

In a new report, the Congressional Research Service (CRS), a nonpartisan advisory group, reviews several ways the federal income tax system might treat small companies preferentially. The CRS studied 14 current small business tax benefits, including an expensing allowance for machinery and equipment and tax credits for start-ups to establish employee retirement plans. It found […]

Auditing accounting estimates

When companies report financial results, they often rely on estimates made by management. Examples include the allowance for doubtful accounts, warranty obligations, costs of pending litigation, goodwill impairment and the fair values of acquired intangible assets. How do auditors evaluate whether amounts reported on the financial statements for these items seem reasonable? Inquiry and testing […]

GAO reports on corporate tax rates

The Government Accountability Office (GAO) has issued a report on corporate income tax rates before and after the enactment of the Tax Cuts and Jobs Act (TCJA) in Dec. 2017. The GAO described the percentage of large corporations that had no federal income tax liability, the average effective tax rates of large corporations and the […]

IRS oversight by Ways and Means Committee

House Ways and Means Committee Chairman Jason Smith (R-MO) is planning aggressive oversight of the IRS. To that end, he’s established an online form to assist IRS personnel who want to submit information confidentially to the committee. Smith said such information can include concerns, information or documents related to misconduct, maladministration, taxpayer mistreatment, wrongdoing or […]