The Tax Adviser back issues from June 2009:
FBAR penalties reduced for six months.(Report of Foreign Bank and Financial Accounts)
Jun 01, 2009; ... The IRS has provided a framework for voluntary disclosure requests containing offshore issues, such as previously undisclosed foreign financial accounts and entities (March 23, 2009, memo from Deputy Commissioner Linda Stiff to LMSB and SB/SE commissioners). The policy will remain in place ...
Prop. regs. on determining partners' distributive shares.
Jun 01, 2009; ... The IRS has issued proposed regulations on determining partners' distributive shares of partnership items of income, gain, loss, deduction, and credit when a partner's interest varies during a partnership tax year (REG-144689-04). The proposed regulations also modify the existing ...
IRS continues to challenge deferral of revenue from gift cards.
Jun 01, 2009; ... In recent years, due to the increasing use of gift cards and the disparity between the federal tax accounting and financial accounting treatment of advance payments, there has been inconsistency among taxpayers and confusion as to the proper timing of recognizing income from gift cards ....
Recognizing unbilled revenue.
Jun 01, 2009; ... In Technical Advice Memorandum (TAM) 200903079, the IRS applied the all-events test for income recognition to service contacts that were subject to the Federal Acquisition Regulations (FAR), 48 CFR Chapter 1. This article discusses the IRS's interpretation and application of the Sec. 451 ...
Tax Court addresses claim of offset against deferred payments.
Jun 01, 2009; ... In a Tax Court case published on January 28, 2009, Trinity Industries, Inc., 132 T.C. No. 2, the court required the taxpayer to accrue in income, in the year it is earned, the total contract price for the sale of barges--including amounts withheld by customers against deferred payments ...
To capitalize or to expense: how sec. 263A treats royalties.
Jun 01, 2009; ... The tax treatment of royalty payments--to capitalize or to expense--depends on the terms of the royalty agreements and, in some situations, the Sec. 263A uniform capitalization rules. This item reviews certain authorities on the treatment of royalty payments, including the Tax ...
Unit of property for network assets.
Jun 01, 2009; ... In March 2008, Treasury issued proposed regulations under Secs. 162 and 263(a) providing guidance on the capitalization and deduction of costs relating to tangible property (REG-168745-03). Included in these regulations are the "repair regulations," a comprehensive set of rules for ...
Customs valuation: a concern for unsuspecting tax practitioners.
Jun 01, 2009; ... A taxpayer's basis in imported goods may depend on customs valuation determinations made by U.S. Customs and Border Protection (CBP). Customs valuation often involves issues that may be unfamiliar to a tax practitioner. Yet failure to recognize this tax-customs intersection may result in ...
Sec. 1245 recapture rules can apply to stock.
Jun 01, 2009; ... Sec. 1245 recapture rules require a taxpayer to characterize gain on the disposition of certain depreciable property as ordinary income to the extent of previously taken depreciation deductions. But those rules can also apply to a disposition of stock. This item discusses how a reduction ...
Electric utility refunds qualify for sec. 1341 tax mitigation.
Jun 01, 2009; ... In a recent private letter ruling, the IRS determined that a publicly regulated utility is entitled to claim benefits under Sec. 1341 for amounts paid to a purchaser of electricity to settle claims asserted against predecessor members of the publicly regulated utility's affiliated group ....
Allocating liabilities among related partners: determining the impact of IPO II.
Jun 01, 2009; ... In 2004, the Tax Court released its decision in IPO II, 122 T.C. 295 (2004). Five years later, IPO II's impact on the allocation of liabilities among related partners has not been fully explored. This item is intended to make the reader aware of IPO II's potential impact on allocating ...
IRS announces procedures for tax return preparer penalties.
Jun 01, 2009; ... The IRS recently issued internal memoranda setting forth procedures for tax return preparer penalties in taxpayer examinations. These include a memorandum by the Large and Mid-Size Business Division (LMSB) on its procedures for tax return preparer penalty cases and two memoranda by the ...
Recent amendment to sec. 1374 provides limited opportunity for S corps.
Jun 01, 2009; ... On February 17, 2009, the American Recovery and Reinvestment Act of 2009, P.L. 111-5 (ARRA), was enacted. ARRA contains numerous tax breaks for individual and corporate taxpayers. Of particular relevance to S corporations is an amendment to Sec. 1374(d) that provides a temporary exemption ...
Sec. 382 after the bailout.
Jun 01, 2009; ... EXECUTIVE SUMMARY * In an effort to ameliorate the current economic crisis, the federal government has created a number of programs, such as the Troubled Asset Relief Program (TARP), in which the government provides cash infusions to ailing corporations in return for equity ...
Establishing substantial authority for undisclosed tax positions.
Jun 01, 2009; ... EXECUTIVE SUMMARY * To avoid the imposition of a penalty for an understatement of tax due to an unreasonable position for an understatement related to an undisclosed position, a practitioner must meet the substantial authority standard with respect to the position. * ...
Student loan forgiveness and repayment programs.
Jun 01, 2009; ... EXECUTIVE SUMMARY * The government and private entities offer various forms of relief from student loan debt, including programs that provide either debt repayment or forgiveness. * In general, when a lender forgives or discharges a borrower's debt, including student ...
Tax amnesty programs and voluntary compliance initiatives: a way to mitigate declining state revenues.
Jun 01, 2009; ... [ILLUSTRATION OMITTED] SINCE 2000, MORE THAN HALF OF THE states have offered tax amnesty programs one or more times (see Federation of Tax Administrators, "State Tax Amnesty Programs" (July 2007), www.taxadmin.org/ fta/rate/amnestyl.html). The programs allow taxpayers to "come ...
Why and how to conduct a tax practice inspection.
Jun 01, 2009; ... [ILLUSTRATION OMITTED] AS AN ACCOUNTING FIRM EXPANDS ITS practice, personnel, and geographic locations, it becomes more challenging to ensure that an effective system of tax quality control is in place to identify and assess high-risk engagements. These engagements can cause ...
Federal Tax Collections, Liens and Levies.(Brief article)(Book review)
Jun 01, 2009; ... [ILLUSTRATION OMITTED] Federal Tax Collections, Liens & Levies, by William Elliott (WG&L, 2009), gives practitioners information to help clients with various actions taken by the IRS. Chapters are included on tax assessments, payments and interest, statutes of limitation, ...
Global Tax Revolution: The Rise of Tax Competition and the Battle to Defend It.(Brief article)(Book review)
Jun 01, 2009; ... Global Tax Revolution: The Rise of Tax Competition and the Battle to Defend It, by Chris Edwards and Daniel J. Mitchell (Cato Institute, 2008), chronicles worldwide tax reforms in recent decades. The authors contend that the U.S. economy can be revitalized by embracing competition and ...
Guide to Property Tax Valuation.(Brief article)(Book review)
Jun 01, 2009; ... Guide to Property Tax Valuation, by Robert F. Reilly and Robert P. Schweihs (Willamette, 2008), provides practical solutions to current ad valorem tax valuation issues, focusing on industrial and commercial properties. It contains many checklists and illustrative examples. Topics covered ...
Qualified Settlement Funds and Section 468B.(Brief article)(Book review)
Jun 01, 2009; ... Qualified Settlement Funds and Section 468B, by Robert W. Wood (Tax Institute, 2009), explains what a qualified settlement fund (QSF) is and how it is implemented. The book shows how these funds can be used advantageously by plaintiffs, defendants, plaintiff lawyers, and settlement ...
Social Security Explained.(Brief article)(Book review)
Jun 01, 2009; ... Social Security Explained, by Avram Sacks (CCH, 2009), explains the Old Age, Survivors, and Disability Insurance program under the Social Security Act. The volume contains Social Security benefit tables and tax tables and provides information on the Social Security system, hospital ...
Handling LLC member and member affiliate loans and guarantees.(limited liability company)
Jun 01, 2009; ... [ILLUSTRATION OMITTED] This case study has been adapted from PPC's Guide to Limited Liability Companies, 14th Edition, by Michael E. Mares, Sara S. McMurrian, Stephen E. Pascarella II, Gregory A. Porcaro, Virginia R. Bergman, William R. Bischoff, James A. Keller, and Linda A ....
Limitation period for equitable innocent spouse relief held invalid.
Jun 01, 2009; ... [ILLUSTRATION OMITTED] In a decision of the full court, the Tax Court held that Regs. Sec. 1.6015-5(b) (1), which imposes a two-year limitation period for requesting equitable innocent spouse relief, is an invalid interpretation of Sec. 6015(f). Background ...
Circular like-kind exchange disallowed.
Jun 01, 2009; ... The Tax Court disallowed tax-free treatment for a like-kind exchange transaction in which the taxpayer exchanged properties with a related entity. Background Ocmulgee Fields, Inc. (OFI) is a corporation that develops, owns, and manages real estate, owned by Charles ...