Proposed revenue ruling gives green light to use of private trust companies Notice 2008-63, 2008-31 IRB
A new notice contains a proposed revenue ruling that would allow families to use private trust companies (PTCs) in their estate planning without adverse income, estate, gift or generation-skipping transfer (GST) tax consequences for the trust creators or beneficiaries in carefully defined situations. IRS requests comments on the proposed ruling.
National Taxpayer Advocate annual report to Congress identifies priorities and issues for upcoming year [IR 2008-87]:
An annual report on the priority challenges and issues facing the Office of the Taxpayer Advocate (OTA) was delivered to Congress on July 8.
The report, National Taxpayer Advocate’s 2009 Objectives Report to Congress, cited three areas for “particular emphasis” in fiscal year 2009, which begins on Oct. 1.
Charitable remainder trust can be divided into separate trusts without adverse tax consequences Rev Rul 2008-41, 2008-30 IRB Mike Habib, EA
In the context of two fairly detailed factual situations, a new revenue ruling makes it clear that a charitable remainder trust (CRT) can be divided into two or more separate CRTs without adverse tax consequences. If properly effected, the separate trusts will continue to qualify as CRTs, the division won’t be a sale, and no excise taxes will arise under Code Sec. 507(c), Code Sec. 4941 or Code Sec. 4945.
Background. In general, a charitable remainder trust (CRT) provides for a specified periodic distribution to one or more noncharitable beneficiaries for life or for a term of years with an irrevocable remainder interest held for the benefit of charity. A CRUT pays a unitrust amount at least annually to the beneficiaries as opposed to a charitable remainder annuity trust or CRAT, which pays a sum certain at least annually to the beneficiaries. (Code Sec. 664)
Loan repayment to shareholder’s spouse wasn’t constructive distribution Beckley, 130 TC No. 18 (2008)
The Tax Court has ruled that payments made by a corporation to the wife of one of its shareholders represented repayment of money she advanced to a predecessor corporation. Despite the absence of a written loan agreement, the repayment wasn’t a constructive distribution to the shareholder.
Final regs include new process for reporting employment tax adjustments and refund claims T.D. 9405, 06/30/2008, Reg. § 31.6011(a)-1, Reg. § 31.6011(a)-4, Reg. § 31.6011(a)-5, Reg. § 31.6205-1, Reg. § 31.6302-1, Reg. § 31.6402(a)-1, Reg. § 31.6413(a)-1, Reg. § 31.6403(a)-2
IRS has issued final regs on employment tax adjustments and refund claims, effective Jan. 1, 2009. The final regs modify the process for making interest-free adjustments for both underpayments and overpayments of Federal Insurance Contributions Act (FICA) and Railroad Retirement Tax Act (RRTA) taxes and Federal income tax withholding (ITW).
House Subcommittee Passes IRS Funding Bill
The House Appropriations Financial Services Subcommittee this week passed a bill that would appropriate $11.4 billion to IRS for FY 2009.
The bill would grant IRS budget authority to spend $5.1 billion on enforcement, $2.2 on taxpayer services, and $3.8 billion on operations.
IRS Announces ‘Dirty Dozen’ Tax Scams for 2008
Phishing Scams, Fuel Tax Credits, Frivolous Arguments, Hiding Income Offshore Top the 2008 Tax Scams
WASHINGTON — The Internal Revenue Service today issued its 2008 list of the 12 most egregious tax schemes and scams, highlighted by Internet phishing scams and several frivolous tax arguments.
Topping this year’s list of scams is phishing, which encompasses numerous Internet-based ploys to steal financial information from taxpayers. New to the “Dirty Dozen” this year is a scheme, which IRS auditors discovered, that relates to unreasonable and/or excessive fuel tax credit claims.
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IRS focusing efforts on four employment tax initiatives
American Payroll Association 26th Annual Congress May 13-17 (Austin, TX)
John Tuzynski, IRS Chief, Employment Tax Operations, told attendees at APA’s 26th Annual Congress that the IRS is focusing its efforts on the following four key employment tax initiatives: (1) worker classification, (2) tip reporting compensation, (3) officer compensation, and (4) fringe benefits.
IRS acquiesces to TLC Leasing – explains meals deduction limit in employee leasing setting Rev Rul 2008-23, 2008-18 IRB
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