Federal Tax Update - May 13, 2013

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Lynn Nichols from NicholsPatrick CPE delivers the weekly federal tax update.  Lynn is one of the top tax instructors in the country.  You can tune into a Lynn Nichols webinar on June 10 - Divorce: Federal Income Tax Issues (Florida Law specific)

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The podcast covers the following:

  1. Final Regs Require EIN Holders to Provide Current Information
    (T.D. 9617; 78 F.R. 26244-26246; 5/6/2013)
    The IRS has published final regulations requiring persons who have been assigned an employer identification number to provide updated information to the IRS in the manner and frequency prescribed by forms, instructions, or other appropriate guidance.
    [Doc 2013-10828]

  2. Taxable Coop Can't Aggregate Patronage, Non-patronage Income for QDPD
    (FAA 20131802F; 2/27/2013; rel. 5/3/2013)
    In field attorney advice, the IRS concluded that a taxable cooperative must separately compute its domestic production activities deduction for patronage and non-patronage sourced income under subchapter T, rather than aggregating the income.
    [Doc 2013-10917]

  3. Elected Constables Are Employees for Tax Purposes; County Is Employer
    (FAA 20131801F; 3/19/2013; rel. 5/3/2013)
    In partially redacted field attorney advice, the IRS concluded that a state's elected constables aren't subject to self-employment tax, are employees for FICA and income tax withholding purposes, and that the county is the statutory employer for employment tax purposes because it controls payment to the constables.
    [Doc 2013-10915]

  4. Corporate Donation of Depreciated Property Not Subject to Sec. 291 Reduction
    (LTR 201318003; 1/22/2013; rel. 5/3/2013)
    The IRS ruled that if a corporate taxpayer donates fully depreciated property to one or more charities, the resulting charitable deduction will not be reduced by 20 percent of the accumulated depreciation of the property.
    [Doc 2013-10795]

  5. JCT Report and W&M Working Groups Could Smooth Route to Tax Reform
    (Tax Notes Today; 5/7/2013; Article by Michael Gleeson and Lindsey McPherson 5/7/2013)
    As the Joint Committee on Taxation on May 6 released its report (See JCS-3-13) chronicling the work of the House Ways and Means Committee's 11 bipartisan working groups tasked with examining tax reform, a Ways and Means aide confirmed that Chair Dave Camp, R-Mich., is looking to the coming debt ceiling negotiations as a potential avenue for advancing reform.  
    [Doc 2013-11012]

  6. Tax Court Remands Case to IRS Appeals Office for Consideration, Clarification
    (Danny Lane; T.C. Memo. 2013-121; 5/6/2013)
    The Tax Court, unable to decide whether to sustain a determination against the sole proprietor of a construction business and finding lack of proof that the IRS considered economic hardship issues in determining to reject his offer in compromise, denied the IRS summary judgment and remanded the case to the Appeals Office for further consideration.
    [Doc 2013-11008]

  7. Tax Court Dismisses Case Filed by Entity Whose Corporate Status Was
    (John C. Hom & Associates Inc.; 140 T.C. No. 11; 5/7/2013)
    The Tax Court dismissed for lack of jurisdiction an entity's challenge to an IRS notice of deficiency, holding that the notice was valid and that the suspension of the entity's corporate status when it filed the petition left it unable to litigate in the Tax Court.
    [Doc 2013-11120]

  8. Researcher, Writer Can't Deduct Expenses for Trips to France
    (Sal A. Westrich; T.C. Summ. Op. 2013-35; 5/7/2013)
    The Tax Court, in a summary opinion upholding an accuracy-related penalty, sustained the IRS's deficiency determinations against an individual, finding that his research and writing activity was not engaged in for profit and that his related expenses, therefore, were not deductible under section 162 or 212.
    [Doc 2013-11122]

  9. Individuals Engaged in Prohibited Transactions With IRAs
    (Lawrence F. Peek; 140 T.C. No. 12; 5/9/2013)
    The Tax Court, sustaining accuracy-related penalties, held that two individuals engaged in prohibited transactions by personally guaranteeing loans to a company owned by their IRAs and as a result, the accounts that held the company's stock ceased to be IRAs in 2001and the individuals were liable for taxes on the gain from the sale of the company's stock in 2006.
    [Doc 2013-11376]
LAST UPDATED 5/13/2013