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In Notice 2018-99, the IRS, responding to questions from taxpayers, provided guidance about how to determine the amount of parking expenses that is nondeductible when employers provide parking for their employees. Under Sec. 274(a)(4), expenses incurred for providing parking to employees that are Sec. 132(f) qualified transportation fringes (QTF) are nondeductible by employers. They are …
Continue reading IRS explains disallowance of qualified transportation fringe benefits for parking
The enactment of Sec. 199A provides one more reason to advise clients to create separate trusts for individual beneficiaries instead of a single trust. A single trust for the benefit of all the children may seem fair and less expensive when children are young. However, different ages, family size, economic status, and risk tolerance can …
According to IRS Notice 2018-61, Treasury and the IRS intend to issue regulations providing clarification of the effect of newly enacted Sec. 67(g) on the ability of trusts and estates to deduct certain expenses. Sec. 67(g), which was enacted by the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97, suspends miscellaneous …
Continue reading Clarification of itemized deductions for trusts and estates
The IRS on Monday issued final regulations (T.D. 9843) that amend the uniform capitalization (UNICAP) rules under Sec. 263A. The IRS also updated the procedures by which taxpayers can get automatic consent to change their methods of accounting to reflect the new regulations (Rev. Proc. 2018-56). UNICAP regulations The IRS says the rules issued in …
Continue reading UNICAP rules on negative adjustments finalized
In proposed regulations issued Wednesday (REG-106706-18), the IRS addressed issues and made conforming revisions arising from the temporary increase in basic exclusion amount for estate and gift tax enacted by legislation known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97. For gifts made and estates of decedents dying before Jan. 1, 2018, prior …
Continue reading Estate and gift exclusion clawback addressed in proposed regs.
The IRS on Thursday issued the 2019 annual inflation adjustments for many tax provisions as well as the 2019 tax rate tables for individuals and estates and trusts (Rev. Proc. 2018-57). These adjusted amounts will be used to prepare tax year 2019 returns in 2020. Many amounts are increasing for inflation in 2019. The standard …
Continue reading Inflation adjustments and tax tables issued for 2019
The Social Security Administration (SSA) announced that the maximum amount of wages subject to the old age, survivors, and disability insurance (OASDI) tax will increase to $132,900 for 2019. The OASDI tax rate is 6.2%, so an employee with wages up to or above the maximum in 2019 would pay $8,239.80 in tax and the …
EXECUTIVESUMMARY Under Sec. 1202, gain on the sale of qualified small business (QSB) stock held for five years is partially or entirely excluded from income. Since Sec. 1202 was enacted, the maximum exclusion has ranged from 50% to the current 100% of gain on qualifying stock sales. For stock to be QSB stock, the corporation …
Continue reading Qualified small business stock gets more attractive
Married couples that jointly own a business often by default choose to treat the business as a partnership, which requires the business to file a partnership return. However, in many cases, treating the business as a partnership and filing partnership returns is optional. A recent Tax Court case highlights how a married couple's choice to …
Continue reading Filing ‘optional’ partnership return costly
Professional gamblers' decadelong streak of being able to deduct a net loss from gambling as a trade or business was ended this year by P.L. 115-97, known as the Tax Cuts and Jobs Act of 2017 (TCJA). Although a relatively minor facet of the wide-ranging tax reform package, the TCJA's amendment to Sec. 165 overturning …
Continue reading Tax reform law deals pro gamblers a losing hand
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