Tax Implications of Installment Sales

More and more taxpayers it seems are finding themselves compelled to engage in a structured installment sale of closely held business assets or rental real estate and I couldn’t help but notice that there are some common misconceptions about the associated tax implications, particularly if ‘related parties’ are involved in a transaction. So this is…

Details

Allowable Nontaxable IRA Rollovers Contributions Interpreted To Mean One Per Taxpayer Per Tax Year in US Tax Court Case – Bobrow v. Commissioner

In Bobrow v. Comm’r, T.C. Memo. 2014-21, the Tax Court relied on IRC 408(d)(3)(B) regarding the limits and frequency of nontaxable rollover contributions elected by the taxpayer noting that the one-year limitation addressed in this section of the US Tax Code applies to all IRAs maintained by the individual taxpayer. So there you have it, as a…

Details

What is a ‘Qualifying Relative’ for US Tax Purposes: IRC 152

Wading through the convolution required to identify specifically who qualifies as a relative for income tax reporting purposes oftentimes can be difficult, not because the actual tax code is difficult to understand in these regards or even subject to much interpretation.  No, it is difficult because the subject matter is best addressed with discretion gained…

Details

Tax Implication of Publicly Traded Partnerships: Why Purveyors or the US Tax Code Snarl at Investment Brokers

My friend Roger Botterbusch recently put together a most excellent presentation on the tax implications of owning Publicly Traded Partnerships (PTPs), also commonly referred to as Master Limited Partnerships (MLPs). As a result I developed a new profound distaste for investment brokers pedaling these things for their ‘prospective’ fat returns whilst simultaneously poo-pooing the heavy, heavy…

Details

IRS Stakeholder Liaison Meeting – Denver

The following is a summary of the IRS’ most recent Stakeholder Liaison Meeting in Denver Colorado as prepared by Ann Burton, IRS Senior Stakeholder Liaison.  It is jam packed with procedural information and status updates from line managers and group leaders of the various IRS operational functions including Collections, Examinations, Appeals, Tax Court etc.  A…

Details

TAS – The Decline and Fall of a Once Great Department Inside the IRS

Last week I read that the Taxpayer Advocate Service’s (TAS) case load has been growing substantially and this once great department inside the IRS does not have the resources to continue to handle its current inventory levels without adversely impacting its ability to provide effective service. As a result, IRS memorandum TAS-13-0913-009 was produced to reissue guidance…

Details

New Office In Home (OIH) Deduction Review IRS Form 8829 & Revenue Procedure 2013-13

According to IRS Revenue Procedure 2013-13 in addition to claiming the traditional office in home (OIH) or home office deduction on IRS Form 8829 there is now a new simplified option you can consider effective January 1, 2013. Basically this new simplified method if selected allows you to claim essentially a “standard deduction” of $5 per…

Details

The Intersection of ‘Trafficking under IRC 280(E)’ & Cost of Goods Sold (COGS) Relevant to Taxable Income for Marijuana Distributors in Colorado

As many of you who follow me and/or this tax blog know I have been actively tracking a handful of select medical marijuana dispensaries in Colorado who have been denied the opportunity to deduct ordinary and necessary business expenses by the IRS when arriving at net income subject to income tax. One of the first…

Details