Here’s the list of forms that the IRS is updating that will delay the processing of your return this year. Note the new “like” and “share” buttons.
Category: Federal Income Tax
Don’t forget your credit union
Credit unions have stepped up their lending. In Austin and across the country, many of these cooperatives have posted record lending growth in recent years and are pushing for the ability to do more. Meanwhile, forthcoming crowdfunding rules could open up a new, multibillion-dollar pipeline between small businesses and the investing public at large.
Read more at Statesman.com
What is my total tax bill?
The American Institute of CPA’s has created a calculator that gives an idea of the total taxes, federal, state, and local, that we pay. TotalTaxInsights.org is brought to you by the American Institute of CPAs, a longtime advocate for sound tax policy, tax simplification and taxpayer education
IRS Loses Lawsuit Challenging Authority to Regulate Tax Preparers
In a stunning blow to the Internal Revenue Service’s efforts to regulate the tax preparation profession, a federal judge struck down the IRS’s licensing requirements for tax preparers on Friday, including testing and continuing education.
Read more in Accounting Today.
Extension of ability to do tax-free Individual Retirement Account rollovers to charity
The American Taxpayer Relief Act of 2012 (ATRA) extended the qualified charitable distribution (QCD) provisions for 2012 and 2013. Several special transition rules were included in ATRA to enable taxpayers to have a donation made before February 1, 2013, treated as a 2012 QCD.
A QCD is an otherwise taxable distribution from an IRA (other than an ongoing SEP or SIMPLE IRA) owned by an individual who is age 70½ or over that is paid directly from the IRA to a qualified charity. An IRA owner can exclude from gross income up to $100,000 of a QCD made for a year, and a QCD can be used to satisfy any IRA required minimum distributions (RMDs) for the year. Also, the amount of a QCD excluded from gross income is not taken into account in determining any deduction for charitable contributions.
Partial list of taxes and fees in health overhaul
Starting in 2014, President Barack Obama’s health care law will expand coverage to some 30 million uninsured people. At the same time, insurers no longer will be allowed to turn away those in poor health, and virtually every American will be required to have health insurance — through an employer or a government program or by buying it on their own.
Net Investment Income Tax FAQs
The Internal Revenue Service and the Treasury Department have issued a set of proposed regulations on the 3.8 percent Net Investment Income Tax that takes effect next year as a result of the health care reform law, along with a FAQ page with questions and answers.
Net Investment Income Tax FAQs.
The First Middle Class Tax Increase
The temporary decrease in the employee portion of the Social Security Tax is set to expire December 31, 2012. Neither party seems inclined to extend it. Since the Social Security Tax wage base is $110,00, employees earning over $110,000 do not pay this tax. This indicates that this rise in tax rates will only affect the lower and middle class.
Toppling Off the Fiscal Cliff: Whose Taxes Rise and How Much?.
Submerged Government Assistance
Suzanne Mettler and John Sides write in their NY Times article that 96% of Americans have relied on government assistance. This includes the deduction for mortgage interest and tax free employer paid health insurance. They call these submerged government social policies. In my opinion, these are the two most likely tax benefits that we will lose in order to balance the federal budget. They also note that ideology determines whether we label government policies as used by producers or moochers.
Good for the goose? Deferred Comp for Private Equity Fund Managers
“Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes.”
Alfred Eisenstaedt/Time & Life Pictures, via Getty Images
Learned Hand, the federal appeals court judge.
— Judge Learned Hand, 1934
Private Equity fund managers use waived management fees to make required contributions to fund a new acquisition of their funds. This is similar to receiving a partnership interest for services which is clearly taxable. Ultimately, the managers pay the cap gain rate on this investment rather than the ordinary income rate. Why doesn’t the IRS challenge this?
A Private Equity Tax Tactic May Not Be Legal – High & – Low Finance – NYTimes.com.