Claiming a disabled spouse; IRS messaging; FASB and codification improvements; and other highlights from our favorite tax bloggers.
Why we tax
- Mauled Again (http://mauledagain.blogspot.com/): What’s the purpose of taxes? To help citizens complain? To keep you employed? To raise tax revenue by encouraging risky behavior? Before considering that question silly, observe what recently happened regarding the Pennsylvania legislature and aerial fireworks previously restricted to use by trained professionals.
- Tax Vox (http://www.taxpolicycenter.org/taxvox): The District of Columbia is considering a plan to transform the city’s Earned Income Tax Credit from a one-time payment at tax time into an incentivized savings program. If participants save part of their EITC refund and stick with the plan for six months, the city would considerably increase their EITC refunds.
- Avalara (https://www1.avalara.com/us/en/blog.html): The Rhode Island Department of Revenue Division of Taxation has published FAQs to help remote sellers understand the impact of Wayfair on R.I. reporting obligations.
- Bloomberg BNA (https://www.bna.com/news/#!topic=tax&type=blogpost&page=1): Many state revenue departments lack the resources and expertise to directly perform transfer pricing audits, and instead employ third-party contractors. A look at the last pending transfer pricing case in the District of Columbia involving the controversial Chainbridge transfer pricing method that has been called an abuse of due process.
- Tax Foundation (https://taxfoundation.org/blog): Will raising tariffs on intermediate goods hurt more manufacturers than it helps? A look at new analyses from the Federal Reserve and the Peterson Institute for International Economics — and the outlook ain’t good.
- The Wandering Tax Pro (http://wanderingtaxpro.blogspot.com/): While the Tax Cuts and Jobs Act didn’t do away with the dreaded Alternative Minimum Tax for individuals, it is as good as gone. (The blogger first ran into clients who became victim of the AMT in the early 1990s and in recent years had to check the AMT exposure of about two out of every three clients annually.)
A little nitty-gritty
- Don’t Mess With Taxes (http://dontmesswithtaxes.typepad.com/): Gym memberships could be deductible. Medical flexible spending accounts would be more appealing. Those are just part of tax changes included in a series of health care bills approved last week by the Ways and Means Committee. Will they make it into law?
- Tax Girl (https://www.forbes.com/sites/kellyphillipserb/#46f971b979cb): Can your client save taxes by treating their home as a rental?
- Dinesen Tax Times (http://dinesentax.com/blog): Can a tax filer claim a disabled spouse as a dependent?
- TaxMama (http://taxmama.com): A few myths cleared up and a few bits of nitty-gritty dispensed on how the new postcard may or may not affect your clients.
- National Taxpayer Advocate (https://taxpayeradvocate.irs.gov/about/nta-blog): Are Taxpayer Assistance Centers meeting the needs of a diverse taxpayer population, both through the services available and the geographic coverage of the TACs? For instance, the IRS recently modified its appointment procedures and will now allow taxpayers to make same-day appointments, but has this message reached the field offices and Mr. and Mrs. Taxpayer?
- Taxjar (http://blog.taxjar.com/): A state-by-state guide to sales tax at crafts fairs and festivals.
- Federal Tax Crimes (http://federaltaxcrimes.blogspot.com/): A look at the government's motion and brief for summary judgment in Kimble v. United States, a FBAR willful civil penalty refund suit. In the brief, the government makes “bold claims” about the standard for what it must prove to establish a person’s liability for the FBAR willful civil penalty.
- Rubin on Tax (http://rubinontax.floridatax.com): The Florida Constitution generally allows a decedent owner of Florida homestead property with a surviving spouse to only devise that property to the surviving spouse. Recent case law, most notably Stone v. Stone, allowed a deed from a spouse to constitute a waiver for this purpose, and practitioners debated the correctness and scope of this decision.
- Wolters Kluwer (http://news.cchgroup.com/): A look at FASB Accounting Standards Update No. 2018-09, “Codification Improvements,” which covers, among other topics, taxes not payable in cash, the reacquisition price of debt and the net carrying amount of extinguished debt distinguishing liabilities from equity.
- Summing It Up (http://blog.freedmaxick.com/summing-it-up): Fourteen years ago, Visa, MasterCard, American Express, Discover, and JCB Co. created the Payment Card Industry Data Security Standard to limit credit card fraud and establish a framework for cardholder data controls. Now that these best practices are compulsory, it’s essential to understand how they impact organizations and the steps needed for compliance.