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Lynn Nichols of Nichols Patrick CPE presents the week’s podcast on the latest federal tax updates. For more information on federal tax, you can click here for the latest tax CPE programs from the FICPA. The podcast covers the following:
[Doc numbers after each item are locaters in Tax Analysts, Tax Notes Today, the first choice of tax professionals for current developments and expert commentary on federal tax matters. The author relies on and recommends Tax Notes Today to anyone whose job requires them to be well informed about current federal tax developments.]
- No Deduction by S Corporation for Settling Claims Against Sole Shareholder
(James A. Cavanaugh Jr. v. Commissioner; T.C. Memo. 2012-324; 11/26/2012)
The Tax Court held that the sole shareholder of a flow-through corporation was not entitled to deduct payments the corporation made to settle a lawsuit against him, finding that the claim did not arise in connection with the corporation's profit-seeking activities.
- Form 1099-K Compliance Program Notices Begin November 27th
(Tax Analysts Tax Notes Today Article by Jeremiah Coder; 11/28/2012)
A new IRS compliance program aimed at finding underreporting of gross receipts by taxpayers who receive Form 1099-K information returns from credit card companies or third-party transaction networks launches this week, a senior IRS official confirmed November 27. Taxpayers identified in statistical analysis may receive notices requiring response.
IRS Provides Q&A on New Form 1099-K Notices
(New Notices Related to Form 1099-K; www.irs.gov; 11/16/2012)
The IRS has posted to its website a list of questions and answers for taxpayers receiving notices or letters related to Form 1099-K, "Payment Card and Third Party Network Transactions."
- Supreme Asked Court to Review First Circuit DOMA Decision by Several Parties
(U.S. Dept. of Health and Human Services et al. v. Commonwealth of Massachusetts et al.; No. 12-15; 7/3/2012, reported 11/28/2012)
The government petitioned the Supreme Court to review a First Circuit decision that held that section 3 of the Defense of Marriage Act violates the Constitution's equal protection clause by denying federal tax and other benefits to same-sex couples, urging the Court to resolve the question of whether DOMA is constitutional. Over a dozen other parties to various DOMA lawsuits have petitioned as well.
- IRS Barred From Levy to Collect Taxes in Excess of Bankruptcy Claim
(Terrance Dale Moore Jr. et ux. v. Commissioner; T.C. Summ. Op. 2012-116; 11/29/2012)
The Tax Court, in a summary opinion, held that satisfaction in a bankruptcy proceeding of the IRS's proof of claim, which erroneously listed a lower tax liability than a couple actually owed, precluded the IRS from collecting the additional amount owed and from collecting post-bankruptcy petition interest for the tax liability.
- Proposed Regs on Net Investment Income Tax Include a Few Surprises
The IRS has issued proposed regulations that provide guidance under section 1411, as added by the Health Care and Education Reconciliation Act of 2010, regarding net investment income tax. (REG-130507-11)
- Proposed Rules for Additional “Hospital Insurance Tax” - .09% of Some Wages
The IRS has issued proposed regulations that provide guidance to employers and individuals on the implementation of the additional hospital insurance tax under the Affordable Care Act. (REG-130074-11)
LAST UPDATED 12/3/2012