Federal Tax Update - May 6, 2013

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Lynn Nichols of NicholsPatrick CPE delivers the latest update on federal tax updates. You can find all of the CPE programs you need to meet your requirements and enhance your business at www.ficpa.org/cpe.  The podcast covers the following:

  1. Maximum Values of Employer-Provided Vehicles for 2013
    (Notice 2013-27; 4/29/2013)
    The IRS has announced the maximum value of employer-provided vehicles first made available to employees for personal use in 2013 for which the vehicle cents-per-mile valuation rule or the fleet-average valuation rule may be applicable.      [Doc 2013-10289]

  2. Determination of Trusts' Material Participation in Company
    (TAM 201317010; 1/18/2013; rel. 4/26/2013)
    In technical advice, the IRS concluded that two trusts did not materially participate in the relevant activities of an S corporation within the meaning of section 469 for purposes of section 56(b)(2)(D).     [Doc 2013-10271]

  3. American Bar Retirement Association Wasn't Tax-Exempt Business League
    (ABA Retirement Funds v. United States; USDC N IL, E Div; 4/25/2013)
    A U.S. district court held that the American Bar Retirement Association didn't qualify as a tax-exempt business league under section 501(c)(6) from 2000 through 2002 and wasn't entitled to a refund of federal income taxes it paid, finding that it didn't meet all of the criteria in reg. section 1.105(c)(6) to qualify as a business league.     [Doc 2013-10351]

  4. Couple Denied Loss Deductions, Liable for Accuracy-Related Penalty
    (Harry E. Cole et ux. v. Commissioner; T.C. Summ. Op. 2013-34; 4/29/2013)
    The Tax Court, in a summary opinion sustaining an accuracy-related penalty, denied a couple's casualty loss deduction for flood damage, finding that they hadn't sustained a loss because they had a pending lawsuit related to the claim, and denied their loss claim for car damage; the court also denied the wife's claim for innocent spouse relief.     [Doc 2013-10438]

  5. Guidance Published on Whether Health Plans Provide Minimum Value
    (REG-125398-12; 5/3/2013)
    The IRS has published proposed regulations on the health insurance premium tax credit, providing guidance on determining whether healthcare coverage under an eligible employer-sponsored plan provides minimum value and on other aspects of section 36B.     [Doc 2013-10573

  6. Trusts Were Shams, Disregarded for Federal Tax Purposes
    (Steven E. Vlach et ux. et al. v. Commissioner; T.C. Memo. 2013-116; 4/30/2013)
    The Tax Court held that a doctor's professional service corporations couldn't claim business expense deductions for payments made to trusts that the court held were shams and disregarded for federal tax purposes; the court held that the doctor and his wife received constructive dividends and were liable for self-employment taxes and penalties.      [Doc 2013-10550]

  7. IRS to Amend Rules on Bottom-Dollar Guarantees
    (Tax Notes Today; 5/2/2013; Article by Amy Elliott)
    The IRS may issue proposed regulations to limit the ability of a partner to assume a so-called bottom-dollar loan guarantee, according to Clifford Warren, special counsel in the IRS Office of Associate Chief Counsel (Passthroughs and Special Industries).     [Doc 2013-10672]