NY storm tax relief

The IRS has provided tax relief to victims of NY state winter storms and snowstorms that occurred between Dec. 23-28, 2022. Individuals and businesses in the disaster area now have until May 15, 2023, to file various tax returns and to make tax payments. Individuals that reside or have a business in the following counties […]

Rent related loss denied

In one case, a married couple wasn’t entitled to deduct a rental-related loss above the amount IRS allowed. During the year in question, the taxpayers rented a basement bedroom in their three-story home to close friend for $300 a month. On Schedule E, they claimed a $30,763 loss on the rental that yielded $3,000 in […]

Fuel Tax Credit fraud increasing

A tax scam to be wary of this tax season is third-party promoters pushing improper Fuel Tax Credit claims. Improper credits continue to be an area of focus for IRS auditors. The Fuel Tax Credit is meant for off-highway business and farming use and, as such, isn’t available to most taxpayers. However, unscrupulous promoters are […]

Proposed Act would provide incentivies for states to recoup fradulent unemployment

The proposed Protecting Taxpayers and Victims of Unemployment Fraud Act would give states incentives for recouping fraudulent unemployment insurance (UI) payments. Lawmakers say it would reduce the federal deficit by shifting program monitoring to the state level. A Congressional Budget Office (CBO) cost estimate says the benefits of doing so may be hard to quantify. […]

IRS comments on ERC

At a recent payroll conference, an IRS director, Daniel Lauer, advised employers to review eligibility guidelines before claiming the expired COVID-19 employee retention credit (ERC). He stated that ERC fraud is common, particularly with IRS Form 941-X, which is filed to make adjustments or corrections to Form 941. If your business claimed the ERC and […]

Comments requested on proposed regulations for CHIP Act

The IRS is requesting comments on proposed regulations regarding the advanced manufacturing investment credit created by the CHIPS Act of 2022. The recently released proposed regs address, among other things, the credit’s eligibility requirements and the term “semiconductor.” For any tax year, the credit generally will be equal to 25% of an eligible taxpayer’s qualified […]

IRS issues guidance on NFTs

Do you own nonfungible tokens (NFTs)? If so, you need to know that the IRS intends to treat certain NFTs as collectibles for tax purposes. According to the IRS, an NFT is a unique digital identifier that’s recorded using distributed ledger technology and may be used to certify the authenticity and ownership of an associated […]

IRS opens 2023 Dirty Dozen Campaign

The IRS recently kicked off its annual Dirty Dozen campaign, which highlights the top 12 scams and schemes that target taxpayers. The “widely circulating promoter claims” regarding Employee Retention Credits (ERCs) is a new entry in the Dirty Dozen list. The fact that the IRS saw fit to start its campaign with ERC claims reflects […]

Do you meet the burden of proof?

Taxpayers can generally deduct the ordinary and necessary costs of doing business, but they must keep adequate records to prove the costs are legitimate. When the owner of a welding business failed to file timely tax returns, the IRS issued a notice of tax deficiency for $183,239 plus penalties. He challenged the tax bill and […]

California storm relief

Victims of severe winter storms, flooding, landslides and mudslides in California that began March 9, 2023, have been granted tax relief, the IRS announced. Those who live in or have a business in the disaster areas now have until October 16, 2023, to file various individual and business tax returns and make tax payments. This […]