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Lynn Nichols from Nichols Patrick CPE delivers the weekly podcast on federal tax issues. For all of your CPE needs, please go to www.ficpa.org/cpe. This week’s podcast covers the following topics:
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- 2013-14 Priority Guidance Plan Adds 501(c)(4) and DOMA Guidance
(Tax Notes Today; 8/12/2013; Article by Tax Notes Staff
The IRS and Treasury released their joint 2013-2014 priority guidance plan August 9 with a few politically charged projects standing out as new additions to its annual list.
- Individual an Employee; Made Excess Contributions to SEP
(Michael Rosenfeld; CA 9; No. 11-73362; 8/8/2013)
The Ninth Circuit, in an unpublished opinion, affirmed a Tax Court decision that held an individual liable for taxes for excess pension contributions based on its finding that he was a common law employee while providing services to a foreign government and wasn't entitled to a deduction for contributions made to a simplified employee pension.
Rosenfeld, Michael v. Comm. T.C. Memo 2011-110; (May 23, 2011)
- Purchase/Sale of Life Insurance Policy Does Not Affect Income Exclusion
(LTR 201332001; 8/9/2013)
The IRS ruled that the purchase of a life insurance policy by a trust does not affect the exclusion from income of the proceeds under section 101(a)(1) because the purchase will be treated as a transfer to the insured and a partner of the insured under section 101(a)(2)(B).
- Proposed Regs on Requesting Equitable Innocent Spouse Relief
(REG-132251-11; 78 F.R. 49242-49248; 8/13/2013)
The IRS has published proposed regulations that provide guidance on the time and manner for requesting relief from joint and several liability under section 6015 and equitable relief under section 66.
- Estate Made Partial Tax Payment, Not Deposit; Refund Denied
(Leone Syring et al. v. United States; DC W WI; No. 3:12-cv-00232; 8/8/2013)
A U.S. district court held that an estate's remittance to the IRS was a partial tax payment and not a deposit, finding that it wasn't designated as a deposit and the IRS treated it as a partial payment; therefore, the estate wasn't entitled to an overpayment because its refund claim was made outside the three-year recovery period in section 6511.
- S Corp Liable for Employment Tax Deficiency, Additions Taxes
(Sean McAlary Ltd. Inc. v. Commissioner; T.C. Summ. Op. 2013-62; 8/12/2013)
The Tax Court, in a summary opinion, determined the reasonable amount of compensation that an S corporation paid to its sole shareholder and officer that was subject to employment taxes and held the S corporation liable for additions to tax for failure to timely file employer tax returns and failure to make timely deposits.
- Final Regs on Information Disclosure for Insurance Affordability Programs
(T.D. 9628; 78 F.R. 49367-49370; 8/14/2013)
The IRS has published final regulations on the disclosure of return information under section 6103(l)(21), as enacted by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010.
- Doctor Must Report Income From S Corporation Interest
(Ramesh T. Kumar et ux. v. Commissioner; T.C. Memo. 2013-184; 8/13/2013)
The Tax Court held that a couple had unreported income in the form of passthrough profits and interest income from an S corporation in which the husband held an interest, finding that another shareholder's interference with his participation in the S corporation didn't deprive him of the economic benefit of his shares.
- Rev. Proc. Consolidates Late S Corporation Election Procedures
(Rev. Proc. 2013-30; 2013-36 IRB 1; 8/14/2013)
The IRS has issued a revenue procedure to facilitate the grant of some types of late election relief by consolidating the provisions of numerous other revenue procedures into one revenue procedure and extending relief in specified circumstances.
- Musician's Business Expense Deductions Allowed; No Penalties Imposed
(Thomas Allen Gullion v. Commissioner; T.C. Summ. Op. 2013-65; 8/14/2013)
The Tax Court, in a summary opinion declining to impose accuracy-related penalties, held that an individual's musical activities are a trade or business for purposes of deducting related expenses under section 162, but the court disallowed deductions for personal commuting expenses and an expense unrelated to the individual's music career.
- IRS Announces Cuts to Refundable Corporate AMT Credit Payments
(Cuts to Refundable Corporate AMT Credit Payments; 8/12/2013)
To comply with fiscal 2013 budget sequestration cuts, the IRS will reduce payments of the refundable portion of corporate alternative minimum tax credits by 38 percent for original and amended returns beginning August 13 and ending September 30, according to a message posted August 12 on the IRS website.
LAST UPDATED 8/19/2013