Awarded money in a lawsuit or settlement? It’s only tax-free in certain circumstances

You generally must pay federal tax on all income you receive but there are some exceptions when you can exclude it. For example, compensatory awards and judgments for “personal physical injuries or physical sickness” are free from federal income tax under the tax code. This includes amounts received in a lawsuit or a settlement and […]

Charitable donations for non-itemizing taxpayers

Taxpayers may see the return of a popular but bygone tax deduction. A bipartisan group of 11 U.S. Senators seeks to expand and extend the expired deduction for charitable donations for non-itemizing taxpayers. Senate Finance Committee members James Lankford (R-OK) and Christopher Coons (D-DE) have introduced the Charitable Act. If passed, this bill would allow […]

Payroll Taxes withheld carry stiff penalities if not paid

Here’s why it’s critical for employers to comply with employment tax rules and pay the IRS what they collect from employees. In February, a Kentucky man was sentenced to 15 months in prison for willful failure to pay over federal income and employment taxes that he withheld from his employees’ paychecks over a period of […]

Use visual aids to enhance financial reporting

Graphs, charts, tables and other data visualizations can be inserted in your financial statement disclosures to improve transparency and draw attention to key accomplishments. As your organization prepares its year-end or quarterly financials, consider presenting some information in a more user-friendly, visual format. Reimagine data presentation In business, the use of so-called “infographics” started with […]

TIGTA reviews IRS examination policies

How does the IRS choose businesses for employment tax examinations and assess taxes if they aren’t in compliance? That’s what the Treasury Inspector General for Tax Administration (TIGTA) reviewed in a recent audit. The IRS Specialty Employment Tax (ET) segment conducts most employment tax examinations. TIGTA found that ET examinations had higher average dollars assessed […]

Changes to Social Security may be on the table

As Social Security reform talks heat up, changes to the retirement age, payroll tax may be on the table – CNBC https://cnb.cx/3kFWUVv

Don’t leave research tax credits on the table

Kansas City, Missouri, changes process for refund of 2022 earnings tax

Kansas City, Missouri, changes process for refund of 2022 earnings tax – KSHB 41 Kansas City News https://bit.ly/3ZHil7a

CBO projections on capital gain realizations

The Congressional Budget Office’s (CBO’s) projections of capital gains realizations have decreased from an estimated high of 8.7% of gross domestic product (GDP) in 2021 down to 3.7% of GDP by 2033. (8.7% was the highest percentage in more than 40 years.) According to the CBO, realized capital gains are highly cyclical and vary more […]

Ways and Means Committee issues Oversight Plan

The House Ways and Means Committee Chair Jason Smith (R-MO) has issued the committee’s Oversight and Authorization Plan. It provides a list of hearings and oversight priorities for the next two years. In a nutshell, the committee is poised to monitor IRS performance and enforcement activities, with other areas of focus including tax relief and […]