Taxcast With Chelsea

1.      IRS Letters & Audits are on the increase and now more than ever recordkeeping should be of utmost importance.
 
CP2000 Notice Description [2:17]
Examples [4:04]
How to Respond [7:23]
 
 Audits / “Under Examination” - Example of what to expect [8:10]
Recordkeeping – airtight is alright. [9:40]

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Today I want to focus on these two main topics:

1.  The US’s historically low tax rates are set to “sunset” at the end of 2025. Surprised by this? Don't be. I make the case for why these are the best tax rates to pay taxes under right now and tips on how to take tax strategy into your own hands.
 
 2.  The IRS has added some online tools & updates to their system for better user experience. I wanted to briefly update you on what you can accomplish online & how to navigate the new tools. 

Links

·        2017 Tax Brackets: https://taxfoundation.org/2017-tax-brackets

·        TCJA Expiring Provisions: https://www.mlrpc.com/articles/tax-cuts-jobs-act-overview-provisions-sunset-expire/

·        Review of changes Post TCJA: https://taxfoundation.org/child-tax-credit-changes-reform/

·        Online IRS Payments: https://www.irs.gov/payments/your-online-account

·        Document upload tool: the CP04, the CP05A, the CP06 and CP06A, the CP08, the CP09, the CP75, the CP75a or the CP75d

o   https://www.irs.gov/newsroom/taxpayers-can-now-upload-more-documents-to-irs-new-online-option-for-9-notices-can-help-resolve-issues-faster

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Today's topics:
1. The IRS missed its strategic plan deadline - what's at stake and what to expect in the coming weeks. [:48]
2. Daniel Werfel went before the Senate Finance committee and still wants to be the next IRS commissioner and makes a daily commitment to taxpayers if confirmed. [5:00]
3. Selling a Rental: what you need to calculate the tax impact & possible other alternatives you haven't considered. [7:48]
**FYI: In this recording, I realized I said form "1310" instead of form "3115" - Sorry about that!** It's tax season folks so my brain is all over the place.


Links

·        Recap on how the IRS will spend IRA funds: https://crsreports.congress.gov/product/pdf/IN/IN11977

·        Senator Mike Crapo opening statements: https://www.finance.senate.gov/ranking-members-news/crapo-statement-at-irs-commissioner-nomination-hearing

·        Good recap of senate hearing by Kelly Phillips Erb: https://www.forbes.com/sites/kellyphillipserb/2023/02/15/bidens-irs-nominee-promises-change-at-senate-confirmation-hearing/?sh=7d8a9c984f83

·        Taxpayer Bill of Rights: https://www.irs.gov/newsroom/taxpayer-bill-of-rights-the-ten-rights-of-every-taxpayer

·        https://www.irs.gov/publications/p527

·        Depreciation rules: https://fitsmallbusiness.com/rental-property-depreciation-rules/

·        IRS How to Depreciate property: https://www.irs.gov/publications/p946

> FORM 3115 for Catch Up Depreciation: https://www.irs.gov/forms-pubs/about-form-3115

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Let’s review these two tax topics today:

1)     Planning for Taxes when you receive nontraditional (non-W2) Income. This includes 1099 income, gambling winnings, and inheritances. I’ll look at examples and how much you should set aside. [:48]

2)     Also, could our tax code be revamped? A recent WSJ article discussed the “Fair Tax” plan and I break down why I think every taxpayer should be ready to debate change inside our nation’s tax system. [8:23]

Links

·        FairTax Act of 2023 https://www.congress.gov/bill/118th-congress/house-bill/25

·        WSJ Article by John Cochrane: “A Consumption Tax is the Shock Our Broken System Needs” https://www.wsj.com/articles/the-fair-tax-is-the-shock-our-broken-system-needs-income-consumption-estate-reform-economy-11675372440?mod=Searchresults_pos2&page=1

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Today's Episode:

1.      Updates on IRS backlog and implementation of the new IRS funding. TIGTA’s recent report on January 12th touts the extra money, but not necessarily improved efficiency. This latest report highlights some of the strains on IRS coming into the 2023 tax season. [:53]
 
2.      Let's review the Restaurant Industry’s Best Kept Tax Secret – the FICA Tip Credit for paid-out tips. I’ll discuss who qualifies, how to calculate, and you’ll see how this credit can really add up for business owners. [7:06]

Links

·        Inflation Reduction Act: Assessment of the Internal Revenue Service Implementation efforts https://www.tigta.gov/sites/default/files/reports/2023-01/2023ier003fr.pdf

·        TIGTA Report 1/12/23 https://www.tigta.gov/reports/audit/backlogs-tax-returns-and-other-account-work-will-continue-2023-filing-season

·        Tip Credit Example https://primepay.com/blog/how-do-i-calculate-my-fica-tip-credit

·        Minimum Wage & State tip credits: https://www.minimum-wage.org/tipped

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Today we’re going to review some recent changes. 

1.      A one-year delay to 1099K requirements - the new $600 threshold. More to come from the IRS [:43]

2.      New Retirement Rules have been passed in Congress through the Secure Act 2.0 and I’ll highlight a few of the changes [4:12]

3.      Let's review how to maximize Qualified Education Expenses when you’re self-employed – you’ll see it’s better than the average taxpayer. [12:58]

Links

·        https://www.irs.gov/newsroom/irs-announces-delay-for-implementation-of-600-reporting-threshold-for-third-party-payment-platforms-forms-1099-k

·        https://www.forbes.com/sites/berniekent/2022/12/27/secure-20-act-allows-later-distribution-of-iras/?sh=21625f6f79a7

·        https://rules.house.gov/sites/democrats.rules.house.gov/files/BILLS-117hr2617eas2.pdf

·        https://www.finance.senate.gov/imo/media/doc/Secure%202.0_Section%20by%20Section%20Summary%2012-19-22%20FINAL.pdf

·        [Judith Meredith, TC Memo 1993-250 (1993).]

·        [Patrick O'Donnell, 62 TC 781 (1974), affirmed in unpublished opinion 519 F.2d 1406 (7th Cir. 1975).] 

·        Attorney allowed to Masters Degree in Taxation: (PLR 9112003)

·        [Daniel R. Allemeier, Jr., TC Memo 2005-207 (2005)] .

·        [Robert C. Beatty, TC Memo 1980-196 (1980) and Frank S. Blair, III, TC Memo 1980-488 (1980).] Finally, a more recent Tax Court Summary Opinion reached the very same conclusion. [Lori Singleton-Clarke, TC Summary Opinion 2009-182 (2009).]

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Merry Christmas! Today I’m going to review these 3 topics:

1.      Check Washing Fraud – What is it and why the millennial's case for making payments for taxes online isn’t so bad. [:49}

2.      The GAO takes a look at the IRS’ 2022 Tax Filing Report. No surprise here but they found Backlogs, Hiring Challenges, Poor Customer Service & Refund Delays [5:57]

3.      LA has a new Mansion Tax coming next Spring to solve their homeless crisis. Will they reach their revenue goals and work as planned? Perhaps… but some are already figuring out how to work around it. [14:20]

 

Links 

·        https://www.tigta.gov/articles/investigations/washington-woman-sentenced-her-role-negotiating-stolen-treasury-checks
Source:  The facts in this case narrative come from the following publicly available documents: W.D. Wash., Indict., filed Feb. 9, 2022; W.D. Wash., Arrest Warrant issued on Feb. 9, 2022; W.D. Wash., Plea Agr., filed July 20, 2022; and W.D. Wash., Judgment filed Oct. 28, 2022. 

·        https://www.uspis.gov/news/scam-article/check-washing 

·        https://www.tigta.gov/articles/investigations/california-man-sentenced-his-role-negotiating-stolen-treasury-checks 

·        https://www.gao.gov/assets/gao-23-105880.pdf 

·        https://www.cpapracticeadvisor.com/2022/12/15/how-the-rich-in-l-a-are-trying-to-avoid-new-mansion-tax/74862/ 

·       UCLA. "An Analysis of 'Measure ULA' A Ballot Measure to reform Real Estate Transfer Taxes in the City of Los Angeles". September 2022. https://www.lewis.ucla.edu/research/an-analysis-of-measure-ula-a-ballot-measure-to-reform-real-estate-transfer-taxes-in-the-city-of-los-angles/#:~:text=This%20white%20paper%20analyses%20Measure,typically%20paid%20by%20the%20seller

·        https://www.latimes.com/california/story/2022-11-12/lopez-column-citizens-led-the-way-on-la-homelessness-tax-measure#:~:text=The%20measure%20calls%20for%20a,buildings%20and%20other%20multifamily%20residences. 

·        https://www.movela.org/measure_ula 

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Today’s 3 topics will cover upcoming tax issues for many taxpayers and consumers:

1.      How to file 1099 forms if you’re self-employed for FREE using IRS.gov website & a quick review of who should file and when these forms are due. [:57]

2.      FTX Crypto Loss & Tax Reporting – information provided by BobJennings, CPA, December 14, 2022 through his TaxSpeaker newsletter [6:57]

3.      Lastly, Why is it so hard to find a tax accountant? Get my inside analysis on why finding a competent tax advisor will continue to be a challenge. Also, I’ll also equip you with questions to ask as you interview or hire your next tax advisor. [12:47]

Links

·        https://www.irs.gov/filing/e-file-forms-1099-with-iris

·        https://www.irsvideos.gov/Business/Resources/HowtoUsetheInformationReturnsPortal

o   file:///C:/Users/tp/Downloads/pub%205717%20IRIS%201122.pdf

·        https://taxspeaker.com
December 14 2022, Emergency Newsletter, “FTX Crypto Loss”

• https://econofact.org/the-mystery-of-the-declining-u-s-birth-rate
• https://www.breitbart.com/politics/2018/07/22/u-s-birth-rate-cut-half-since-1950s-remain-next-century/
• https://www.cpajournal.com/2022/11/14/an-update-on-the-future-of-accounting-education/#:~:text=According%20to%20the%202021%20AICPA,the%202017%2F18%20academic%20year

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Hey everyone welcome to Taxcast with Chelsea where I give you a small dose of interesting tax news and answer commonly asked tax questions. 

Today let’s review these 3 topics:

1.      Tis’ the Season for Security: IRS Controls to Prevent and Recover from Ransomware Attacks were generally effective (according to a recent TIGTA Report) … but is that enough? (:47)

2.      Also…Attorney Michael Avenatti was Sentenced to 14 years in Federal Prison for stealing and tax fraud-details from the US attorney general & IRS criminal investigation (5:14)

3.      Many states have passed SALT Parity Acts to favorably aid owners of Pass-through entities (PTEs) with tax deductions. How does this work and let's look at specific highlights for my MO/KS business owners (12:42)
***CORRECTION*** MISSOURI does allow SALT payments for 2022 - I misspoke in this episode after it was published.

Links

·        https://www.tigta.gov/sites/default/files/reports/2022-11/202320002fr.pdf

·        https://securelist.com/crimeware-report-ransomware-tactics-vulnerable-drivers/108197/

·        https://www.irs.gov/compliance/criminal-investigation/lawyer-michael-avenatti-sentenced-to-14-years-in-federal-prison-for-stealing-millions-of-dollars-from-clients-and-tax-fraud

·        https://www.washingtonexaminer.com/policy/courts/legal-storm-michael-avenatti-pay-resitution-stormy-daniels

·        https://www.irs.gov/newsroom/irs-provides-certainty-regarding-the-deductibility-of-payments-by-partnerships-and-s-corporations-for-state-and-local-income-taxes

·        Forthcoming regs regarding SALT - https://www.irs.gov/pub/irs-drop/n-20-75.pdf

·        https://www.grantthornton.com/insights/alerts/tax/2022/salt/k-o/kansas-enacts-income-property-and-sales-tax-changes-07-15

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf

Employer Retention Credits: are providing some employers additional cash but also risk for audit. Let’s look at a few things to consider before hiring an accountant to file these amendments (:53).
Tax Strategies for the almost retired… this topic is actually for everyone! You don’t want to wait until you’re retired to start planning – There are Tax Strategies to think about before you take out social security or taking required minimum distributions (5:15). 

(TIGTA) has a new website with new features which may actually help the IRS and taxpayers connect with a common purpose (that is carrying out a fair and impartial tax system) (12:27).

Links

·        https://www.wsj.com/articles/as-pandemic-aid-dries-up-businesses-chase-covid-tax-credit-11668292886?mod=Searchresults_pos19&page=1

·        Estate Planning Law https://easterdaykc.com/ (Jeff, Joe, & Samara are great!)

·        https://www.cms.gov/newsroom/fact-sheets/2023-medicare-parts-b-premiums-and-deductibles-2023-medicare-part-d-income-related-monthly

·        https://www.irs.gov/newsroom/reminder-to-ira-owners-age-70-and-a-half-or-over-qualified-charitable-distributions-are-great-options-for-making-tax-free-gifts-to-charity

·         Exciting TIGTA SCAM videos: https://www.youtube.com/channel/UC4dSU0BElmzA_o7atb929AA

Connect with Chelsea:
Email: [email protected]
Leave a comment on this podcast.

**DISCLAIMER**
Taxcast with Chelsea is not legal or tax advice for your personal tax situation. My views are my own and I am only speaking from a tax practitioner’s perspective for the general understanding of tax topics. I highly recommend you engage with an experienced tax professional if you are looking for personal tax advice.
https://www.irs.gov/pub/irs-pdf/pcir230.pdf