Reporting Threshold Decreased

A law passed last year lowered the reporting threshold for gig workers and others who receive certain types of payments from $20,000 to $600. According to taxpayer groups and lawmakers, that change has harmed both taxpayers and the IRS. The reduced threshold may result in a deluge of Forms 1099-K from confused online sellers being […]

Crowdfunding

Using websites such as GoFundMe or Kickstarter is an easy way to raise money over the internet from a large group of people. Often referred to as “crowdfunding,” it may be used to fund business ideas, help families pay medical bills or raise money for charity. Bear in mind that the income raised by crowdfunding […]

The Employer-Provided Child Tax Credit

A recent Government Accountability Office (GAO) report confirms that the Employer-Provided Child Tax Credit can financially benefit employers and employees. The statutorily mandated review drilled down on several subjects, including the tax implications for employer-provided child care, characteristics of employers claiming the credit, challenges employers face in offering it and benefits eligible employees receive. Overall, […]

IRS update

In a March 21 speech before a tax executives convention, IRS chief Charles Rettig stated that the agency is “trending in a really good direction” in catching up on unprocessed returns. However, he warned, the agency needs more in long-term government funding if it’s going to achieve its six-year modernization plan. Despite a recent 6% […]

The voice bots are coming

The next time you contact the IRS, your call or online text might be received by a voice or chat bot. The IRS is now employing the technology on two of its specialized phone-assistance lines and on IRS.gov. The voice bots will provide taxpayers with assistance in English and Spanish. These bots can help taxpayers […]

Which IRS notices are temporarily suspended?

A bipartisan group of lawmakers recently sent a letter to IRS Commissioner Charles Rettig requesting information on the suspension of certain tax notices that the IRS normally issues when a taxpayer owes tax and the IRS has no record of the taxpayer filing a tax return. The lawmakers expressed confusion about the extent to which […]

Charitable Donations

Advocates of charities are urging Congress to revive a charitable giving deduction for taxpayers who don’t itemize on their tax returns. The above-the-line tax deduction was created by the CARES Act in response to the pandemic. It was available in 2020 and extended through 2021 but has expired for 2022. For 2021, the deduction was […]

Employ a household worker?

Did you employ a household worker in 2021? This could include a housekeeper, nanny, gardener, cook, health care worker, tutor or someone else. If so, you may owe what’s commonly called the “nanny tax.” If you paid him or her $2,300 or more in 2021 you must file Schedule H (Household Employment Taxes) with your […]

IRS reports on backlog of unprocessed returns

A large number of errors made by taxpayers is hurting the IRS with its inventory of unprocessed tax returns. The backlog is mostly paper-filed returns and is dominated by errors relating to Economic Impact Payments (EIPs). On more than 10 million returns filed in 2021, taxpayers “failed to properly reconcile” the two 2020 EIPs with […]

IRS updates vehicle tables

If your business buys or leases passenger vehicles in 2022, review the IRS’s recently updated depreciation deduction and income inclusion tables. In general, taxpayers may claim an additional first-year depreciation deduction equal to 100% if they place qualified purchased vehicles into service before 2023 (other rules and limitations apply). Table 1 lists depreciation limits for […]