IRS: Advisory Council 2019 Annual Report

November 22, 2019By Smeriglio Associates LLCNews

The IRS Advisory Council has issued its 2019 annual report, which makes recommendations to the tax agency on new and continuing issues in tax administration. The 2019 report includes recommendations on various topics and concerns. They include accelerating the use of e-signatures in federal tax administration, guidance relating to the Tax Cuts and Jobs Act … Read More

IRS House Calls

November 22, 2019By Smeriglio Associates LLCNews

The IRS is making house calls. Due to declining IRS resources in some areas, taxpayers with ongoing tax compliance issues may get a knock at the door. The primary goal is to establish face-to-face contact with individuals whose issues haven’t been resolved by mail. The IRS officer will attempt to gather financial information and will … Read More

USCIS: Form I-9

November 21, 2019By Smeriglio Associates LLCNews

Employers should keep using the current version of Form I-9. The U.S. Citizenship and Immigration Services (USCIS) has advised employers to continue using the current form, even though it expired on Aug. 31. All employers in the U.S. must complete a Form I-9 for each person, citizen or noncitizen, hired to work in the U.S. … Read More

U.S. Tax Court: Contemporaneous Business Expenses

November 21, 2019By Smeriglio Associates LLCNews

The U.S. Tax Court ruled that a taxpayer who worked as a taxi driver and a real estate appraiser wasn’t eligible to deduct vehicle-related expenses relating to an appraisal business he operated from a friend’s house. The court stated that the taxpayer didn’t meet strict substantiation requirements. Rather, he offered only inconsistent testimony and noncontemporaneous … Read More

Credit Creditworthiness

November 20, 2019By Smeriglio Associates LLCNews

Extending credit to business customers can be an effective way to establish goodwill and nurture long-term buyers. But customer credit also brings financial risks. For this reason, it’s critical to thoroughly research a customer’s creditworthiness. Start by contacting the potential customer’s trade references to get background on its payment history. Also check its banking info … Read More

IRS: “Change of Address” Argument

November 20, 2019By Smeriglio Associates LLCNews

Taxpayers lose their “the IRS should’ve known we changed our address” argument. The U.S. Tax Court has ruled that the IRS properly mailed a deficiency notice to a married couple’s last known address. The taxpayers didn’t live at that address at the time the deficiency notice was mailed and argued that the IRS Appeals Officer … Read More

IRS: Tax-exempt Organization Donor Listings

November 19, 2019By Smeriglio Associates LLCNews

Tax-exempt organizations can generally be penalized for not reporting donor information for donations of $5,000 or more. But in IRS Revenue Procedure 2018-38 (issued in July 2018), certain organizations were excused from including this information on future Forms 990. In July 2019, the U.S. District Court of Montana found the Rev. Proc. invalid. That meant … Read More

U.S. Tax Court: Lawsuit or Settlement Income

November 19, 2019By Smeriglio Associates LLCNews

Income from a lawsuit or settlement can be excluded from income if it’s paid due to personal injury or sickness. In one case, the U.S. Tax Court ruled that a taxpayer wasn’t entitled to exclude from income the amount her homeowner’s association had paid to settle a lawsuit she’d filed. She’d alleged nuisance, and breach … Read More

SSA Letters titled “Education Correspondence”

November 18, 2019By Smeriglio Associates LLCNews

Problems arise when data reported on a W-2 form doesn’t match data held by the Social Security Administration (SSA). Wages and taxes paid can’t be credited to the right wage earner. To fix errors, the SSA regularly notifies employers when mismatches occur in the name and Social Security number on a W-2, or when key … Read More

TCJA Miscellaneous Itemized Deductions

November 18, 2019By Smeriglio Associates LLCNews

The Tax Cuts and Jobs Act suspended miscellaneous itemized deductions for tax years beginning after Dec. 31, 2017, and before Jan. 1, 2026. To reflect the change, the IRS has updated rules for using standard mileage rates when computing the deductible costs of operating an automobile for business purposes. Revenue Procedure 2019-46 explains that a … Read More