Qualified appraisals on gifts of cryptocurrency

If you donate cryptocurrency to a charity, you may need a qualified appraisal, depending on the amount of the gift. In Chief Counsel Advice, the IRS denied a taxpayer’s charitable deduction of a cryptocurrency contribution because she didn’t obtain a qualified appraisal. The taxpayer argued that no appraisal was necessary for the $10,000 donation she […]

1099-K transition update

In Dec. 2022, the IRS agreed with critics and announced a delay in implementing a $600 de minimis threshold (from a $20,000 threshold) for reporting third-party settlement organization transactions. The IRS stated there would be a one-year “orderly transition” period instead. However, taxpayers that performed backup withholding (generally for payees without taxpayer ID numbers) in […]

Federal budget deficit grew 29%

According to the Congressional Budget Office (CBO), the federal budget deficit grew by 29% ($418 billion) in the first quarter of fiscal year (FY) 2023 over the same period in FY 2022. Meanwhile, receipts declined by 2%, or $26 billion. In its latest report, the CBO drills down on these totals. Individual income and payroll […]

FICA tax tip credit

House lawmakers have reintroduced proposed legislation to expand the Federal Insurance Contribution Act (FICA) tax tip credit. The bill would expand the credit, currently available to the food service industry, to “employer-based salon and beauty service” establishments. Tips are paid as a gratuity by customers directly to the workers providing the services. Employers are required […]

Debt Limit Reached

Absent congressional intervention, the federal government will soon reach its limit on the amount of money it’s authorized to borrow, according to U.S. Treasury Secretary Janet Yellen. The current limit was set on Dec. 16, 2021. If not raised (or suspended) once again, the limit will be met on Thursday, Jan. 19. “Once the limit […]

Changes to Charitable giving documentation recommended

Does current tax law encourage charitable giving? According to National Taxpayer Advocate (NTA) Erin M. Collins in her annual report to Congress, the answer may be “no.” Donations to qualified charities can generally be deducted on the donor’s tax return. However, the donor must have received a written acknowledgement from the charity before filing a […]

Want your tax refund ASAP?

Want your tax refund ASAP? Here are 5 pitfalls that can delay your check. – CBS News https://cbsn.ws/3wiwWcJ

Do you have a profit motive?

Taxpayers who are in business to make a profit can usually deduct related expenses on their tax returns. If the IRS doubts a profit motive exists, the activity may be deemed a hobby, limiting the ability to deduct costs. The burden to prove there’s a profit motive is on the taxpayer. In one case, a […]

Ways and Means Committee makes member changes

Newly elected U.S. House Ways and Means Committee Chair Jason Smith (R-MO) has wasted no time in assembling his team. The majority party typically gets 25 seats (compared with 18 for the minority party) on the tax-writing committee, and Smith has added 10 members now that Republicans are in charge. These include lawmakers with tax-writing […]

Filing Season Opens Soon

Get ready to file your 2022 tax return! The IRS has announced that the 2023 tax season begins on Monday, Jan. 23. As always, taxpayers are encouraged to file well in advance of the April 18, 2023, deadline to beat the last-minute rush and help prevent tax identity theft. The IRS is expecting more than […]