Suppose you sell a business for $10,000,000, claiming your basis is $10,000,000 when it’s actually closer to $1,000,000. You’ll have to pay tax on that $9,000,000 difference (plus interest and penalties) if the IRS catches you before the statute of limitations runs out. How long do they have to catch you? The Supreme Court will probably have to step in and resolve this question, which has divided the Courts of Appeals. (more…)
Archive for the ‘News’ Category
IRS Heard it Through the Grapevine: Pay Up!
Monday, March 14th, 2011IRS to Lien Less Heavily
Monday, February 28th, 2011The IRS has a responsibility to pursue collection when taxpayers fail to meet their obligations. An overly rigid approach can produce hardship, however, without necessarily enhancing government revenue. Recognizing this reality, the IRS has announced what they call “a new effort to help struggling taxpayers get a fresh start.” They’ve increased the dollar threshold at which they’ll impose liens, made it easier to obtain lien withdrawals, and implemented other changes that should be helpful to many individuals and small businesses that are unable to pay their taxes. Click here for the IRS announcement.
Unpopular Paperwork Requirement Appears Doomed
Friday, February 4th, 2011It turns out there’s one feature of the healthcare reform law just about everyone agrees on. A provision requiring increased reporting of payments by businesses using Form 1099 was designed to increase government revenues by some $44 billion without increasing taxes. Yet the paperwork burden brought complaints from all quarters, reaching such a level that President Obama mentioned the need to repeal this provision in his State of the Union address. Repeal had been stymied by disagreement over how to prevent a $44 billion increase in the projected budget deficit. The Senate has now voted overwhelmingly in favor of repeal with a provision that calls for unspecified cuts in spending.
Fairmark Wrapup
Monday, January 10th, 2011Here’s a summary of the top news, features and other items of interest relating to taxes and investing published recently at Fairmark.com.
The Fairmark Wrapup is also published as a free email newsletter. Click here to sign up.
Mom Pays, Daughter Deducts
Tuesday, January 4th, 2011What happens when one person has a deductible expense, and someone else pays it? Suppose, for example, a mother covers medical expenses and real estate tax for her daughter. That’s what happened in a recent Tax Court case (Lang) (PDF). (more…)
Fairmark Wrapup
Monday, January 3rd, 2011Here’s a summary of the top news, features and other items of interest relating to taxes and investing published recently at Fairmark.com.
The Fairmark Wrapup is also published as a free email newsletter. Click here to sign up.
RALs Blocked at Block
Monday, January 3rd, 2011H&R Block has announced it won’t offer refund anticipation loans this year. RALs have been criticized for imposing high costs on consumers while providing little benefit. H&R Block’s action was based on loss of their funding arrangement, however, rather than ethical concerns.
Jackson Hewitt and Liberty Tax Service intend to continue offering the controversial loans.
Related
Start of Tax Filing Season Delayed for Itemizers, Others
Thursday, December 23rd, 2010The tax law set off a scramble at the IRS to reprogram its computers and change its forms to reflect all the changes. The agency has announced that the tax filing season will begin on time for most taxpayers, but itemizers and certain others will have to wait until mid- to late February before filing. (more…)
Tax Numbers for 2011
Thursday, December 23rd, 2010Official figures for the 2011 tax rates, personal exemptions, and other numbers that are adjusted annually for inflation have been released by the IRS and are now available in our Reference Room.
Tax Deal Now a Done Deal
Friday, December 17th, 2010The tax deal brokered by President Obama and Senate Republicans passed its last hurdle when it secured approval from the House of Representatives late Thursday. It was enacted into law when President Obama signed it Friday. For an overview of major tax provisions, see our Q&A on the Tax Deal.
