Passive Asset Disposition

There are two distinct issues to evaluate when disposing of a passive  asset: Is the disposition considered to be a qualifying disposition under reg 1.469 making the losses deductible? Is the gain on the sale truly passive income and entered

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Adoption Tax Credits including Tax Credit Carry Forwards are now FULLY REFUNDABLE in tax year 2010 According to IRS Notice 2010-66

According to Marilyn E. Brookens, an attorney in the IRS Office of Associate Chief Counsel (Income Tax and Accounting), “Effective for the 2010 tax year, the adoption tax credit is a FULLY REFUNDABLE TAX CREDIT.  The credit was made refundable

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Reporting 1099-C income, cancellation of debt income exclusion – IRS form 982

Debt that is forgiven is considered income for taxes purposes and is reportable to the IRS.  The debt forgiven is reported by the lender to the IRS on form 1099-C.  The debt forgiven is reported by the taxpayer as other

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New IRS Forms for Reporting Exercise of Stock Options

The IRS has issued two new forms for reporting stock options. Form 3921, Exercise of an Incentive Stock Option Under Section 422(b), and Form 3922, Transfer of Stock Acquired Through An Employee Stock Purchase Plan Under Section 423(c), reflect the

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What happens with suspended prior year losses when a now non-passive activity generates net income?

If the current year non-passive activity triggers deductibility of prior year suspended passive activity losses, IRC 469(f) permits a prior year passive loss to offset current year income from the same activity, even though that income might be non-passive in

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Grouping Passive Activities – IRS Rev Proc 2010-13

This new IRS Revenue Procedure is hugely important. Beginning in tax years after 1/24/2010 the IRS is requiring a written statement to accompany the tax return that lists how passive investment activities are grouped. The statement must include your name,

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Tests for Material Participation IRC 469(h) Reg. 1.469-5T

Material participation is regular, consistent and substantial personal involvement in operations. It is required in businesses, farms, rental real estate owned by real estate professionals, most vacation rentals, hotels, motels, and B&B’s, etc.. Basically most anything reported on IRS form

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Passive Activity – New in 2010 – An Overview of Internal Revenue Code 469

According to Revenue Procedure 2010-13 starting in 2010: A written statement is required to group similar business/activities. Managing LLC members must pass any of 7 tests for material participation the most popular of which is the 500 hours per year

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Stop messing around, take it to IRS Appeals

My mantra lately is becoming .... 'take it to appeals. Stop messing around.' The Appeals function offers an additional forum for taxpayers to resolve conflicts and mediate disputes with all operating divisions inside the IRS. The IRS Appeals function should

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Posted in IRS Appeal, IRS Audit, IRS Collections, IRS Enforcement, IRS Examination, IRS Levy, IRS Lien, IRS Mediation, IRS Penalties, IRS Penalty and Interest Abatement

Partial Payment IRS Installment Agreement PPIA

The PPIA is an installment agreement that pays back less than what is owed to the IRS because of the expiration of the statue of limitations for collection. It is requested by filing out  IRS form 433. The PPIA was

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Posted in Installment Agreement, IRS Appeal, IRS Audit, IRS Collections, IRS Enforcement, IRS Examination, IRS Levy, IRS Lien, IRS Mediation, IRS Penalties, IRS Penalty and Interest Abatement
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