Vice president of taxation for the American Institute of CPAs Tom Ochsenschlager listed the top 10 provisions in recent tax legislation in his keynote speech at the New York State Society of CPAs’ Annual Tax/Plenary Conference on Nov. 16.Provisions folded into the Tax Increase Prevention and Reconciliation Act Ochsenschlager outlined included:

  • Changes in Roth conversions and planning;
  • A wider application of the ‘kiddie’ tax;
  • An increase in the exemption amount for the AMT;
  • The extension of capital gains and dividend rates;
  • Extension of Section 179 expensing; and,
  • The closing of the manufacturing deduction loophole;

Other TIPRA changes include the complication of corporate estimated payments, harsher qualifications for offers in compromise (including 20 percent nonrefundable down payments), withholding on payments to government contractors and easier requirements for qualified care facility loans. Ochsenschlager’s Top 10 changes under the Pension Protection Act included:

  • Rollovers to Roth IRAs;
  • Non-spousal rollovers;
  • Direct payment of refunds to an IRA;
  • An anti-Enron provision regarding employee investment in company stock;
  • Faster vesting;
  • Automatic enrollment protections;
  • Simplified 5500 reporting;
  • Charitable contributions from IRAs for taxpayers at least 70 1/2;
  • The easing of AGI limitations on easement benefits; and,
  • A change in the basis rules for S-corporation contributions of property.

Ochsenschlager also described a number of recent court decisions, including the Qureshi decision in federal Claims Court, which raised the question of whether a taxpayer is required to report all available deductions. The taxpayer chose not to deduct her state and local income taxes, which resulted in a decrease in her AMT liability. The court held the amount she owed under the AMT, the tentative minimum tax, did not depend on whether she chose to take a deduction for state and local income taxes for purposes of computing her regular tax liability.

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