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Posts tagged "Internal Revenue Service"

The timeframe for appeal of a denied offer in compromise

In a previous post, we discussed a denied offer in compromise filed by actor Wesley Snipes. He tried appealing, first to the IRS Office of Appeals and then to the Tax Court, but lost his appeals due to specific fact circumstances unique to his case. In this post, we’ll discuss the time frames for general appeals of denied offers in compromise.

IRS finalizes rules regarding charitable contributions

Recently the IRS issued final rules regarding the reporting and record-keeping requirements for deductible non-cash charitable contributions. There are different categories of mandatory documentation required for various amounts of contributions. Regardless of the value of the contribution, though, proof of its value is necessary, whether in the form of a hand-written note, a receipt or a qualified appraisal.

Neglecting FATCA reporting risks noncompliance for banks

Foreign financial institutions (FFIs) without an adequate reporting strategy could risk noncompliance with IRS regulations regarding offshore accounts. Non-domestic accounts subject to the Foreign Account Tax Compliance Act (FATCA) must be reported by financial institutions as well as by the account holders themselves under the tax code. Not adequately informing the IRS – either directly or indirectly – about the presence of foreign assets held by U.S. taxpayers could lead to steep penalties, both for the account holder and the FFI itself. In particular, the FFI could face a punitive withholding tax that may far outweigh the cost of any single foreign account.

Tax burden on retirees could shift this fiscal year

Thanks to the Tax Cuts and Jobs Act of 2017, many of us saw our income tax requirements and need for withholding shift. The IRS is now warning a particular demographic of the need to carefully review withholdings in light of upcoming changes brought about by the TCJA: retirees.

Don’t forget to report 1099-C debt cancellation income

A recent tax court decision reveals just how important it is to not ignore income on Form 1099-C come tax time. The case, TCM 2018-140, involves a taxpayer who received debt discharge to the tune of over $360,000 back in 2010. Lacking any other income for the year, the taxpayer chose to not file a tax return. In 2018, he incurred failure-to-file and failure-to-pay penalties due to his lack of tax reporting.

IRS offers guidance on new head-of-household credits

The passage of the 2017 Tax Cuts and Jobs Act (TCJA) brought many changes to the way that most Americans handle their income taxes. Most of the changes for middle-class earners comes with the loss of personal exemptions and an increase in the standard deduction. There are also new tax brackets, which may allow some people to pay less even while maintaining their same salary.

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