Collection Due Process

Taxpayers who can’t pay their past-due tax bills may request a Collection Due Process (CDP) hearing. One married couple filed their 2016 tax return in 2019 but didn’t pay the full tax due of $41,678. After the IRS issued a levy notice, the couple requested a CDP hearing. They asked that their account be considered […]

Are you an employee?

Employee or independent contractor? When a court must decide how workers are to be classified, it looks at various factors. In one case, the U.S. Tax Court found that a provider of private duty nurses failed to classify 99 nurses as employees during 2016–2018. The factors considered included: the degree of control the company exercised […]

Tax issues to assess when converting from a C corporation to an S corporation

Operating as an S corporation may help reduce federal employment taxes for small businesses in the right circumstances. Although S corporations may provide tax advantages over C corporations, there are some potentially costly tax issues that you should assess before making a decision to switch. Here’s a quick rundown of the most important issues to […]

Can you hear me now?

The Taxpayer Advocacy Panel (TAP) is a group of volunteers that makes recommendations to the IRS about issues that affect ordinary taxpayers. As TAP’s website proudly states, “We’re the voice between the IRS and you.” The IRS isn’t obligated to act on every suggestion, nor does it. However, of the 126 items submitted to the […]

Update for energy production credits

The IRS has just published new inflation adjustment factors and reference prices for determining Code Sec. 45 energy production credits. This credit generally is available to qualified renewal electricity producers. For 2022, the inflation adjustment factor for qualified energy resources is 1.8012 and the reference price for facilities producing electricity from wind is 4.09 cents […]

FAQs about fair value in accounting

In recent years, accounting rule makers have issued guidance that requires certain items on the balance sheet to be reported at “fair value.” Here are some answers to frequently asked questions about this standard of value and how it’s measured. What is fair value? Under U.S. Generally Accepted Accounting Principles (GAAP), fair value is “the […]

Qualified Opportunity Funds review by IRS

The Qualified Opportunity Zone (QOZ) program allows investors to make long-term investments in distressed communities. More specifically, it allows investors who recognize capital gains to reinvest those gains in Qualified Opportunity Funds (QOFs) that, in turn, invest in one of nearly 9,000 designated QOZs. If you’ve made QOF investments, you may soon receive a letter […]

Foreclosure cases

Sometimes to satisfy delinquent tax debt, the IRS pursues foreclosure of a primary residence. Recently, the Treasury Inspector General for Tax Administration (TIGTA) looked at whether the IRS needs to improve its handling of these actions. In 96 lien foreclosure cases over two years ending Sept. 30, 2020, revenue officers generally followed procedures. But in […]

Once you file your tax return, consider these 3 issues

The tax filing deadline for 2021 tax returns is today, April 18. After your 2021 tax return has been successfully filed with the IRS, there may still be some issues to bear in mind. Here are three considerations: 1. You can throw some tax records away now You should hang onto tax records related to […]

Identity Theft

What happens if a thief steals your identity and files a fraudulent tax return? Although not all fraud can be easily detected, the IRS scans tax returns for possible fraud as they’re received. Returns that are flagged as suspicious will be pulled for extra review. If this happens with your return, you’ll receive an IRS […]