IRS Notice

The IRS and the capitalization of tangible assets

March 10, 2008 | Mike Habib, EA

New proposed regs address complex issue–capitalization of tangible assets

Mike Habib, EA
myIRSTaxRelief.com

IRS has issued new comprehensive proposed regs on when amounts are treated as paid to acquire, produce, or improve tangible property. They replace controversial proposed regs that were issued on the same subject in 2006 and that IRS has now withdrawn. The new proposed regs would be effective for tax years beginning on or after the date that they are finalized.

This article explains how the proposed regs would define materials and supplies that are deductible under Code Sec. 162, and prescribe new rules for when the deduction for these items may be claimed. Future articles will explain other key aspects of the new proposed regs, such as how to treat amounts paid to sell property, transaction costs related to acquisitions, and what constitutes a repair versus an improvement or betterment to property.

1031 Like-Kind Exchanges Tax FAQ

March 8, 2008 | Mike Habib, EA

Like-Kind Exchanges Under IRC Code Section 1031

Mike Habib, EA
myIRSTaxRelief.com

Whenever you sell a business or an investment property and you have a gain, you generally have to pay tax on the gain at the time of sale. IRC Section 1031 provides an exception and allows you to postpone paying tax on the gain if you reinvest the proceeds in similar property as part of a qualifying like-kind exchange. Gain deferred in a like-kind exchange under IRC Section 1031 is tax-deferred, but it is not tax-free.

Poker Tournament Winnings Must be Reported to the IRS

March 8, 2008 | Mike Habib, EA

Starting March 2008, casinos and other sponsors of poker tournaments will be required to report most winnings to winners and the Internal Revenue Service, according to the IRS.

Mike Habib, EA
myIRSTaxRelief.com

The new requirement, which went into effect on March 4, 2008, was contained in guidance released Sept. 4 by the Treasury Department and the IRS. The guidance is designed to clear up confusion about the tax reporting rules that apply to poker tournaments. In recent years, some casinos and players have been confused over whether poker tournament sponsors who hold the money for participants in a poker tournament are required to report the winnings to the IRS and withhold tax on the winnings.

Tax audit of Exempt Organizations Non Profit Organizations

March 8, 2008 | Mike Habib, EA

Examination and Compliance Check Processes For Exempt Organizations

Mike Habib, EA

myIRSTaxRelief.com

Past due tax return what to do

March 8, 2008 | Mike Habib, EA

Help Yourself by Filing Past-Due Tax Returns

Mike Habib, EA
myIRSTaxRelief.com

Most citizens voluntarily file their tax returns and pay their taxes. Most people explain it by saying they want to pay their fair share. Others file to get a refund, claim a credit or avoid breaking the law.

Pension Protection Act of 2006 Tax Issues

March 8, 2008 | Mike Habib, EA

Guidance on timing of PPA-related amendments for calculating plan cash-outs starting in 2008

Mike Habib, EA
myIRSTaxRelief.com

IRS has issued guidance, in question and answer format, that addresses the timing of plan amendments made to comply with Sec. 302 of the Pension Protection Act of 2006 (PPA 2006, P.L. 109-280, Sec. 302), which changed the statutory assumptions that must be used beginning in 2008 for calculating the present value of plan cash-outs.

Retirement News for Employers

March 6, 2008 | Mike Habib, EA

IRS explains how to correct a failure to follow retirement plan terms
Retirement News for Employers

Mike Habib, EA

In its Retirement News for Employers, IRS has explained how to correct the common retirement plan mistake of failing to follow the plan terms in its operation. IRS clarified when a plan amendment can be used to correct this mistake via the Employee Plans Compliance Resolution System’s (EPCRS) Self-Correction Program (SCP).

Distressed asset trust DAT tax problem

February 28, 2008 | Mike Habib, EA

Distressed asset trust transactions identified as listed transactions

Mike Habib, EA

In a Notice, the IRS has identified a distressed asset trust (DAT) transaction as a listed transaction under Reg. § 1.6011-4(b)(2), Code Sec. 6111 and Code Sec. 6112. In such a transaction, a tax-indifferent party contributes one or more distressed assets with a high basis and low fair market value to a trust or series of trusts and sub-trusts, and a U.S. taxpayer acquires an interest in the trust for the purpose of shifting a built-in loss from the tax-indifferent party to the U.S. taxpayer that has not incurred the economic loss.

How to reconstruct tax records after a disaster

February 27, 2008 | Mike Habib, EA

Reconstructing Your Records

Mike Habib, EA

Reconstructing records after a disaster may be essential for tax purposes, getting federal assistance or insurance reimbursement. Records that you need to prove your loss may have been damaged or destroyed in a casualty. While it may not be easy, reconstructing your records may be essential for:

Is an IRS Offer In Compromise right for you? Know your options!

February 27, 2008 | Mike Habib, EA

Direct from the IRS

Mike Habib, EA

Is an Offer in Compromise Right for You?