Feb 20
A recent case in the Tax Court decision, Lucas, T.C. Memo. 2018-80 held that legal and professional fees related to an investment advisory firm partner’s divorce do not qualify as business expenses. The Tax Court determined that they were instead nondeductible personal expenses. One of Mr. Lucas’ arguments was that the millions in legal and professional fees …
Permanent link to this article: https://betweenthenumbers.net/2019/02/legal-fees-in-divorce-disallowed-as-a-business-expense/
Feb 08
A concerted effort by the IRS to improve its whistleblower reporting program is showing benefits to both sides. IRS whistleblowers collected $312 million in fiscal 2018, a huge increase over the $33.9 million received in the prior year. The IRS collected $1.4 Billion from the tips provided by these whistleblowers. In order to collect an …
Permanent link to this article: https://betweenthenumbers.net/2019/02/irs-whistleblowers-set-new-record/
Jan 19
Economic damages should return a plaintiff to the position they would have been in “but for” the underlying improper act[s] by the defendant. They should not provide a windfall to plaintiff. In a similar vein, whether such damages are taxable is generally related to how the proceeds would have been treated if obtained in the …
Permanent link to this article: https://betweenthenumbers.net/2019/01/when-litigation-proceeds-are-taxable/
Oct 31
There has been a flurry of activity in the emerging legalized cannabis industry, as regulations and restrictions continue to decrease. Given that the U.S. cannabis market is estimated to be approximately $60 billion, with still plenty of room to grow, it is not surprising that many investors are looking at this industry. However, prudent investors …
Permanent link to this article: https://betweenthenumbers.net/2018/10/cannabis-company-valuations-present-unique-challenges/
Oct 04
For months, the American Institute of CPAs (AICPA) and American businesses have been requesting guidance from the U.S. Treasury Department and Internal Revenue Service (“IRS”) regarding changes made by the Tax Cuts and Jobs Act (TCJA) (Pub. L. No. 115-97) that disallowed the deductibility of entertainment, amusement, recreation and qualified transportation fringe expenses. Businesses and their accounting …
Permanent link to this article: https://betweenthenumbers.net/2018/10/irs-confirms-continued-partial-deductibility-of-business-meals-when-separable-from-entertainment/
Mar 28
The current tax season brings some small consolation to victims of Ponzi schemes and certain other financial fraud, with the Internal Revenue Service (“IRS”) allowing duped investors to obtain partial relief in the form of a theft loss tax deduction. Internal Revenue Code (“IRC”) 165(a) provides that a theft loss incurred in a transaction entered …
Permanent link to this article: https://betweenthenumbers.net/2018/03/tax-deduction-available-for-ponzi-scheme-related-theft/
Aug 12
A federal appeals court has agreed with an unmarried California couple that they should not be treated as married with regard to mortgage interest deductions limits. Bruce Voss and Charles Sophy are co-owners of real property. Each claimed a home mortgage interest deduction in reliance on Section 163(h)(3) of the Tax Code, which allows for …
Permanent link to this article: https://betweenthenumbers.net/2015/08/appeals-court-provides-tax-benefit-to-unmarried-couples-with-high-mortgage-debt/
Jun 23
The taxation of gambling winnings is widely misunderstood (or at least widely not followed). Gambling gains are included in gross income, reported on “other income” on form 1040. Losses from gambling are allowed to the extent of gambling gains, but only as an itemized deduction. The amount spent to generate any win reduces the win. …
Permanent link to this article: https://betweenthenumbers.net/2015/06/the-irs-wants-more-of-your-gambling-winnings/
May 06
A recent report indicated that over a 10 year period approximately 1,600 Internal Revenue Service (“IRS”) employees willfully evaded their tax obligations. The wrongful activity included: failing to file timely claiming improper dependents claiming improper first-time homebuyer credits The law calls for the termination of such employees unless it is waived by the IRS commissioner. …
Permanent link to this article: https://betweenthenumbers.net/2015/05/irs-workers-found-to-have-evade-tax-payment/
Feb 20
Recently the government sent out Form 1095-A to Obamacare participants. However it appears that an error reported in the forms mailed out will need to be corrected. As a result, affected taxpayers are requested to wait until they get corrected forms before filing. The blog at healthcare.gov reads: “If you enrolled in a plan through …
Permanent link to this article: https://betweenthenumbers.net/2015/02/government-typo-will-require-certain-taxpayer-to-delay-filing/
