Federal Update:

 

Senate eyes sneaky strategy for internet taxes.  Rollcall news indicated they expect Senator 

Reid to attach the Marketplace Fairness Tax Bill to the Internet Freedom BIll

 

IRS eases rules for donated unused vacation time to fight Ebola 

 

PTIN renewals for tax preparers has begun

 

IRS announces new pension plan limitations.  Taxpayers can contribute an extra $500 in 2015 to the their 401(k) plan

 

Swiss Banks are pushing back on Scope of Agreement under the U.S. Amnesty program.

US to disclose Swiss Bank Information

 

Vanguard seeks t dismiss whistleblower suit by its former tax lawyer

 

State Update:

 

 

The State that has the worst tax climate according to the tax foundation is:

   

     WY    1

     SD     2

     NV     3

     AK     4

     FL      5

     VT     46th

     MN     47th

     CA     48th

     NY     49th

     NJ     50th

 

IA - What are your intention with the pumpkin you just purchased?

 

IL - Amazon to open IL warehouse next year

     Recoups $100M in unpaid sales tax on gasoline for under reported fuel reported to the state

     Collected $10B in sales tax collections

     Tax lawyer (Gary Stein) of celebrity clients indicted on tax fraud - impeding obstructed the IRS $5M in improper credits

 

NJ - PA Gross Receipts Tax and PA Capital Stock tax not required to be added back tin calculating the NJ net income

 

NV - Considers a gross receipts type tax 

 

WA - Wastewater discharge not an illegal tax

 

AirBNB to begin collecting sales taxes in LA, SF, and NY (NY AG says that AirBNB violates the local hotel laws

 

International 

 

Hungary - Internet Tax Protests

Spain - Google Tax - News aggregation sites will be forced to pay news site a fee for linking to their news article effective January 1, 2015

 

                   

Main Topic

 

Marijuana…The High Taxes of State Marijuana Legalization

   What to know about the taxes and state marijuana legalization business

 

1. High Excise Taxes

          CO - Averages 30%

          WA - Averages 44%

          On the 2014 Ballot:

               AK - $50 per ounce excise tax.  Expected to raise $73M from 2016 - 2020

               OR - $35 per ounce excise tax

               FL - Legalize Medical Marijuana

     

 

2.  Where does the money go?

          CO - Build Schools

          DC - Drug A

          OR - 40 percent would go to the Common School Fund

                        20 percent for mental health/alcohol/drug services

                        15 percent for state police

                        20 percent for local law enforcement

                          5 percent for the Oregon Health Authority. 

            WA - Drug substance abuse

                      Research

                      Education 

                      Healthcare    

 

3  Highly regulated

 

4.  Still illegal at the Federal level

 

 

5.   IRS Rule  (IRS Code 280E)

       70% of your profits go to Federal Taxes

    

In this week's episode,

 

Federal"

 

    Delay the processing time 9.6 days.  IRS has up to 45 days to issue a refund without interest

    Single Point of Contact for victims of ID Theft

    Allow taxpayers to turn off Electronic Filing

 

IRS can seize assets (bank accounts) on suspicion (no crime required) - NY Times

 

McConnell expects the tax extenders to pass until January 2015 and repeal of the Medical Devices Tax. Discussion on business tax provisions.  

 

Forbes article - What if Congress raised taxes and nobody care or even noticed.

 

State:

 

Taxing marijuana 

 

 

AL - Quietly working to prepare for the internet sales tax as early as next year (Streamline Sales Tax Commission)

 

AZ - How many taxes can one City have (City of South Tucson, AZ).  Effective December 1, 2014, there are 15 tax changes, two new classifications.

 

     Town of Campe Verde, AZ - tax exemption for sales of food for home consumption is suspended from December 1, 2014 through November 30, 2017.  Sales tax rate of 3%

 

ND - Devils Lake must repay $112,000 to the state.  The state sent tax collections to the wrong city because of a coding error. City of Devil's Lake will be working on a repayment plan.

 

NY - Tax Scrammers copying the fax IRS tax call template (Attorney offering to settle their tax debt)

 

WI = Considering a sales tax on gasoline ($680M shortfall in the state's transportation fund)

 

WY - Effective January 1, Online Travel Companies (OTCs) must register with the Dept of Revenue and collect sales taxes on the rooms reservation sold on their website(s)

 

Main Topic 

 

Healthcare Subsidiaries 

 

 

Healthcare Subsidiaries:

 

http://bit.ly/1tgiGvb

 

NY Times Story on the Law that Lets I.R.S. Seize Accounts on Suspicion, No Crime Required

  

http://nyti.ms/1FUbERV

 

Forbes Article - What if Congress Taxes and No One Cared--or even noticed

 

http://onforb.es/1vdKBbM

 

In this week's episode,

 

Federal Tax Update:

 

A partnership and Brazilians never intended to conduct business  Purportedly contributed customers receivables to the LLC.  Did not form a bona fide partnership for servicing and collecting the receivables owed to the retailers.

 

Tax relief to 30 states for drought stricken farmer

 

Taxpayers freaking out over Hoax Claiming 2015 IRS refunds until October 15th 

 

FBAR Delinquent Procedures

     1.  Review the FBAR instructions

     2. File all FBARs electronically at BSAE filing

     3. On the cover page of the electronic form, select a reason for filing late

     4. Include a statement explaining why the FBAR is late 

 

     IRS Long standing policy was to treat the non farmers as rental income subject to self-     employment taxes

 

State Tax Update:

 

CA-Mieage tax test coming within the next year

 

KS - Amazon to close their distribution center in Coffeyville, KS (Will Amazon still collect sales tax)

 

LA - Tax amnesty is running from October 15th - November 14th 

               100% taxes, 50% of the interest

               Apply online at ldrtaxmnesty.com

 

MO - Supreme Court declines to review a Missouri Rabbi Trust Business Income

          Income subject to apportionment for the Mississippi on income and assets located in Missouri 

 

NC - Policy change announced regarding Partnership Apportionment

     Remove provisions for reporting income from segregated activities

     Include a line for reporting non-apportionable  North Carolina income from oath Carolina Sources and a line for reporting North Carolina income subject to apportionment.

 

OH - Identity theft blamed for skyrocketing bogus Ohio tax filings

 

OR - Denied business deduction on a schedule C from a 2010 tax return since there was no income.  Solar lenses.  Purchased from one company and sold to another company 

          Voluntary Mileage tax (1.5 per mile) 

 

Local Tax Update:

 

Berkeley - Soda tax (one cent per ounce on sugary drinks)

San Francisco - Voters to decide Soda Tax

 

International Tax Update:

 

Mexico - Adopted a 10 percent tax on sugary drinks in October

               Non-sugary drinks increased by 7 percent and water increased by 13 percent

 

Main Topic - 

 

     Taxes, Licenses, and Permits to expect when you're starting a business

          1. Business License

          2.  Other permits and licenses

          3.  Gross Receipts Taxes

          4.  Federal Taxes

          5.  State Taxes

          6.  City Taxes

          7   Foreign Taxes

 

In this week's episode, 

 

Federal Update

 

IRS Predicting delays in refunds in 2015 based on the tax extenders

Senator Wyden 

 

US Supreme Court refuses to hear appeal on marriage bans in several states

 

WSJ - taxes on internet access services could top $14B a year.  Internet Tax Freedom Act is set to expire on December 14th.

Marketplace Fairness Tax Act

 

State Tax Update

 

MD - US Supreme Court is set to a case whether Maryland has the right to tax out-of-state income if they earn income and pay taxes in those other states (county income tax.

 

Marketplace Fairness Tax Act

 

Oklahoma Voluntary Disclosure

 

International Tax Discussion

 

Netflix Tax

 

Main Tax Discussion

 

8 IRS Online Tax Tools

     1. IRS Free File

     2. Check you Refund

     3. Direct Online Pay

     4. Online Payment Agreement

     5. Request a Transcript

     6. Tax Questions & Answers

     7. Tax Documentation & Publications

     8. Verifying Qualified Charities

In this week's episode:

 

 

Corporate Inversions

 

Professional Sport Franchises may tax exempt 

 

Healthcare subsidiaries are in trouble

 

State Tax Update:

 

GA City considering creating a Dorm Tax

 

CA - Federal Express contractor are employees

 

DC - Some tobacco products may become tax exempt

 

State tobacco settlements are winding down.

 

Cloud computing

 

Main Topic:

 

When You Need A Tax Expert

Appeals court to review the decision striking down subsidiaries through the Federal Health Exchange that struck down the credits in states did not start their own healthcare exchanges.

 

U.S. Treasury is seeking fewer tax loopholes

 

A Grandfather could file as head of household.  The grandchildren live with him more than 1/2 the year and he provided more than 1/2 of their support.

 

Taxpayer could not take the first time homebuyer's credit for property obtained through divorce

 

Credit for taxes paid to other states is before the Supreme Court

 

Federal Tax Update:

 

Stop-Gap  Spending Bill

 

IRA - 60 Day rollover Requirement Waived

 

         Deceased Wife's IRA was distribution

 

         Rollover Requirement Denied

 

          Extend Tax Incentives

 

Administration and Senate push for broad intent sales tax

 

House passes bill for identity theft

 

 

Indiana - Economic Nexus

 

Kentucky not bound by a letter ruling that the corporation had nexus with Kentucky

 

 

Scotland - Independence Vote

 

 

Preparing for Year End

 

1.  What is your YTD taxable income

 

2.  Unknown

 

        1.  Capital Gains

        2.  Investment Sales

        3.  IRA Distributions

        4.  Interest Income

        5. Social Security

3.  Taxable Income

4.  Annualized Income

5.  Itemized / Standard Deduction,

6.  Tax Liability

7.  Taxes Paid  YTD

8.  Difference is the estimated tax

In this week's episode,

 

 

     Fresenius Medical Care Holding Inc

          Lack of Tax Characterization agreement did not prevent settlement deduction

                    FCA False Claims Act settlement between a medical corporation and the government

                    Pre-condition is not required

 

Premium Tax Credit for newly married taxpayers

 

Taxpayer could not deduct business use of cell phone expense - She presented non evidence with respect to the claimed cell phone expense

 

IRS gives tax exempt status to a Bit-coin based foundation (Bitgive Foundation)         

 

Taxpayer not allowed innocent spouse relief - no hardship was showed

     1/2 of the proceeds of the house sold jointly - ex-husband paid his portion of the tax due on the understatement

 

Taxpayer substantially understated their income.  Gross income included only included gain on sale of investment assets not amount realized  (Barkett - tax court)

 

IRS - The 5 ways to spot scam calls

 

    

CA - California resident was not entitled to a California personal income tax credit for taxes she paid to the State of MD on retroactive back pay she received from her forma employer while she was a CA resident from former employer the University of District of Columbia

 

     The MD non-resident return showed a zero tax liability and a refund.  Because she didn't owe money to MD, she did could not use the tax credits.

    

CA - Did  not abate penalty imposed for late payment of her California personal income tax liability.  They had reasonable cause because they did not receive the K-1 until a week before the accountant filed the tax return that included a gain from the sale of the S-Corporation

    

CA - Did  not abate penalty imposed for late payment of her California personal income tax liability.Trustee on her husband's estate received a K-1 from the sale of annuities

 

IL - use of promotional codes creates nexus - retailer has a contract with an IL person which receives a commission or other consideration on the sale of property by the retailer directly or indirectly refers potential customers to the retailer to tract purchases through promotional codes.

 

MA - Tax Amnesty Program - September 1 - October 31, 2014  -   Tax periods before July 1, 2014

 

          Individuals with existing personal tax liabilities

 

          Existing Use Tax

         

          Business taxes

               Withholding Taxes

               Sales and Use Tax

               Meals Tax Local options

               Cigarette individual excise tax and cigar/smoking tobacco tax

 

    In September, 300,000 qualifying taxpayers will receive a tax amnesty notice from the Dept. of Revenue notifying them that they qualify for the tax amnesty program

 

 

MN - Personal income tax alternative method of apt allowed for compensation of non-resident corporate board members

      Total time spent in MN  generating compensation for being a director divided by total time the director spends generating the compensation from the board.  Effective for years beginning after December 31, 2007

 

Va - Sales and use tax on internet access reactivation and right-of-ways fees are taxable

 

 

The 9 Exceptions to the Early IRA Distribution Penalty         

In this week's episode:

 

Federal Update

 

Low income housing credit for major disaster area

 

Government not entitled to dismiss employers' challenge to premium tax credit

 

Corporate inversions still underway

 

New Rules allow for renal projects funded by exempt facilities bonds to offer emergency housing after disasters

 

 

State Tax Update

 

IL - Corporate, Personal Income Taxes Refund Limitations

 

IA - Corporate Personal Income Taxes

 

MD - Separate Reporting Requiring did not eliminate tax liability

 

MA = Corporate personal income taxes

 

MN - Sales and Use Tax  refund program discussed for expansion

 

NJ - Corporate Income Tax - Operational Income, Partner Refunds and discharged debt discussed

 

NC - Sales and use tax for online travel companies discussed

 

TX - Tobacco tax - tax on non-settling manufacturers ruled unconstitutional

 

Entities and Tax Rates and Structures

 

     1.   Corporate Structure

     2.   Partnership Structure

     3.  S-Corporation Structure

     4  LLCs

    

In this week's episode, I discuss:

 

    Federal Tax Update

 

          Wyden - Bipartisan Inversions Bill in September

          Schumer Earnings Stripping Reform from 50% to 25%  with a carryforward of 10 years

          National Retail Federation wants tax reform before year end

 

          IRS Clarifies the construction start date tests for  energy credit

 

          IRS Issues guidance on Health Insurance Providers Fees for 2014 fee

 

          Czech Republic and the U.S reached an agreement on the Foreign Account Tax Act

 

State Tax Update

 

     AK - Local Tax referendum was valid

 

     CA - Issues tax brackets, filing threshold, and other amounts

 

     IL - Corporate, Personal  Income Taxes - Medical Cannabis Surcharge Regulation adopted

          Amount of federal tax liability

 

     LA - Tax Amnesty Program will run October 15 -November 14, 2014 for all applicable taxes except for motor fuel taxes and penalties for failure to submit information reports that are not based on an underpayment of tax.  Waives penalties and 50% of interest

 

     MA - Job creation and other economic credits enacted

 

     MS - Deferred revenue subject to franchise tax

 

     NY - Refund claim limitation periods suspended for financially disabled individuals

 

     WA - Photography sales tax is sourced where the customers receive the photos  if that location is know

 

     WY - Sourcing of sales tax occurs where the customer tax possession

 

Tax In Depth

 

     Schedule F

 

          1.  Farmers Income

 

          2.  Depreciation of assets

 

          3.  Expenses

 

          4.  Erosion and conservation programs

 

          5.  Record Keeping

 

In this week's episode,

 

Federal Tax Update

 

Senate passed the House Gas with the changes we had discussed.

 

Senate still pressing President on Corporate Inversions

 

IRS issues guidance on Whistle Blower Awards Program

 

State Tax Liability:

 

 

CO - Tax Liability of Online and Mail-Order Retailer Discussed

 

FL  - Sales and Use Tax Business Activity Established

 

MI - Did not respond to a Alternative Apportionment Petition

       Taxpayer assumed that MI accepted the alternative apportionment

        MI said that they did not accept the alternative apportionment.

 

MS - Second Amendment Tax Holiday Sept 5 -7

 

NJ -  Bonus Depreciation Decoupling

        Departure from Federal Adjusted Gross Income

 

TX - Refunds available to Cable TV Internet Access

        New Regulations Governing Insolvency Settlements

 

VT - Property Tax Taxpayer failed to proved change of Domicile

 

Main Discussion

 

 

Installment Agreements

 

    1.  When to use installment agreements>

 

    2.  When not to use installment agreements?

 

    3.  Is the installment agreement guarantee?

 

    4.  Is there a installment agreement fee?  Payment methods accepted?

 

    5.  Payroll Deductions can be used to make payments on the installment agreement.

 

    6.  Online agreement vs paper form agreement

 

    7.  What is the turn around period for the installment agreement?  When should I expect to hear from the IRS?

 

    8.  How do I Terminate an installment agreement.

 

    9.  Partial Payment

 

  10.  Choosing the payment due date.

 

  11.  Is a offer in compromise the same as an installment agreement?

 

  12.  Can an installment agreement be revoked?