Federal Tax Update Podcast

This week we look at:

• A look at the interaction of qualified plans and post-70 ½ deductible IRA contributions under the SECURE Act.

• A date change in the final version of the SECURE Act related to the kiddie tax.

• An ESOP is found to be disqualified from inception due to both issues in its plan document and in operation of the plan.

• IRS announces e-file start dates, with business returns now being accepted.

• Two cases look at the timing of the required IRS supervisor review of proposed penalties in an exam.

Copyright 2020, Kaplan, Inc.

This week we look at:

• Case from the Archive: Taxpayer Shows How to Win When the IRS Claims Your Business is a Hobby

• Taxpayers who have SFR prepared won’t see a §199A deduction in the SFR 2020

• Auto mileage rates issued at the last minute

• Charitable contributions of virtual currency guidance issued by IRS in FAQ

• Taxpayers can’t raise substance over form argument since the taxpayer picked the form

• Final Qualified Opportunity Fund regulations issued by the IRS

• IRS issues updated guidance on withholding on pensions

Copyright 2020, Kaplan, Inc.

This week we look at:

• §199A final regulations – a pre-tax season package that had to be quickly understood
• 2019’s year end tax bills – comes in three parts, along with a good portion of the government’s full appropriations package
• The IRS’s fascination with tax basis capital, and the profession’s reaction to the same
• §199A FAQ – so we’ll have fewer sub-regulatory guidance items, but that doesn’t mean it all gets reviewed like regulations. Or, perhaps, be careful what you wish for…
• States looking to extend their tax reach, but in a case with limited application SCOTUS did find there are some limits
• Additional items beyond the top five…

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of December 23, 2019: A Tax Bill for the Holidays

• Further Consolidated Appropriations Act, 2020 signed into law on December 20, 2019
  • SECURE Act
    • The good: Delay in required beginning date for plan distributions, later plan adoption date, etc.
    • The bad: Death of the stretch IRA
  • Extenders apply retroactively - so there are some amended returns that will be needed
  • Tax-exempt version of the parking lot tax is gone, but the for profit version is still around

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of December 16, 2019: The Sound of Silence

• IRS does not have the discretion to waive repayment of advance premium credit
• Employer who reimburses employee when transit card fails to function has to include amount in wages per CCA
• IRS issues more proposed regulations on state tax issues and charitable contributions, but remains silent on passthrough tax issues
• IRS grants relief from use of tax basis capital account on partnership K-1s for one year

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of December 9, 2019: Bring in the Forms

• Final version of 2020 Form W-4 released Final versions of 2019 Forms 1040, 1040-SR, Schedules 2 and 3 released
• Shortly thereafter, final version of Schedule 1 released still containing question about virtual currency
• Relief for provision of Forms 1095-B and C
• Detailed guidance issued for IRS agents on BBA audit procedures

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of December 2, 2019: Horses and Hobbies

• Commissioner rules that insurance payments for pyrrohite damage does not require Forms 1099
• Horse business found not to be a hobby, losses allowed
• IRS updates per diem rules for TCJA, following similar update for auto mileage rules

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of December 2, 2019: Horses and Hobbies

• Commissioner rules that insurance payments for pyrrohite damage does not require Forms 1099
• Horse business found not to be a hobby, losses allowed
• IRS updates per diem rules for TCJA, following similar update for auto mileage rules

Copyright 2019, Kaplan, Inc.

Current Federal Tax Developments for the week of November 25, 2019: Back to the FAQ

• IRS discusses information security responsibilities and risks for tax professionals
• Rental section added to IRS’s §199A FAQ page on website
• Final regulations issued on anti-clawback estate/gift tax provisions
• Only one penalty applied to taxpayer that was both the owner and beneficiary of a foreign trust

Copyright 2019 Kaplan, Inc.

Current Federal Tax Developments for the week of November 18, 2019: Upcoming Features

• Significant TCJA guidance to be issued by end of January 2020
• PLR allows advisory fees to be paid out of an annuity without trigger taxable income to owner
• IRS announces enforcement program for syndicated conservation easement programs
• IRS updates auto mileage rulings for changes made by TCJA
• IRS found to have attempted to assess tax on Son of BOSS after all statutes had expired

Copyright 2019, Kaplan, Inc.