Are You Prepared for the Corporate Transparency Act?
As the clock strikes midnight on January 1, 2024, the Corporate Transparency Act (CTA) will come into full effect. In simple terms, the CTA requires that every company organized in the United States identifies its beneficial owne... Fernando Juarez Hernandez, EA
Small Business Inventory Rules Under the Tax Cuts and Jobs Act
The Tax Cuts and Jobs Act (TCJA) made a significant change to the rules for eligible small business taxpayers that were previously required to maintain inventories and utilize the accrual method of account... Patrick D. Dimmitt
Transforming How the IRS Serves Taxpayers
In this article, the authors offer strategies for deploying the recently bestowed $80 billion in long-term IRS funding, and they discuss how properly implementing five existing technology-driven IRS initiatives will improve both taxpayer... Fred T. Goldberg Jr., Charles O. Rossotti, and John Koskinen
When Your Client Says, “I’ll Fake a Receipt.”
You are representing a long-time client in an Internal Revenue Service (IRS) audit. You just received a Form 4564, Information Document Request (IDR), from the IRS. The IDR is focusing on his Schedule C business expenses. You call the clie... Daniel N. Price
Ethical Issues to Consider in Recent Tax News
More Options to Correct Returns Electronically The Internal Revenue Service (IRS) has announced that more forms can now be amended electronically. These include people filing corrections to the Form 1040-N... TheTaxBook
Ethical Considerations with Cryptocurrency Tax Preparation
Cryptocurrency taxation is an area that is here to stay, even though many tax professionals may wish otherwise. A March 2022 NBC News survey shows that more than 20 percent of American adults have interacted with cryptocurrency.i Some professionals... Matt Metras, EA
Should Circular 230 More Widely Permit Contingent Fees?
Editor’s note: Fees are a hot topic currently in the tax industry since there is high demand for our services but limited capacity in our firms. Circular 230 does cont... Jeremy Wells, EA, CPA, and Sarah Moessinger, EA
Can a Taxpayer Deduct Payments if no Form 1099 Is Issued?
The United States Tax Court recently took up an interesting case which, on its surface, seems a run-of-the-mill case (it is a memorandum decision). However, it has some interesting perspectives related to documentation of payments to contract... Thomas Gorczynski, EA, USTCP
Due Diligence: How Do You Do It and How Much Is Enough?
When I was director of the Office of Professional Responsibility, one of the most frequent questions I received from tax professionals around the country was: "How do I know when I have done enough due diligence?" The ultimate answer: “It depends,” sho... Karen L. Hawkins
Excluding Medicare Waiver Payments from Income
The Internal Revenue Service (IRS) has provided guidance on the tax treatment of certain payments to individual care providers for the care of eligible individuals under a state Medicaid waiver program in IRS Notice 2014-7.i The prog... Laurie W. Ziegler, EA
How to Be Eligible for Substantial Tax Savings as a Trader
There are tax advantages for traders who are eligible for trader tax status (TTS). This article provides an overview of how to qualify for TTS (no election is required): Automated trading systems can qualify for TTS, providing the trader is significantly involved ... Robert A. Green, CPA
Your Questions Answered
QUESTION #1: During tax year 2019, one of our firm’s business clients had a very successful year. The business is a general partnership and it provides consulting services. Pass-through income, and thus taxable income, was high enough that the qualified business incom... Alison Flores, JD