Charitable contribution has always been a hot IRS tax audit item.
Recently, the Congressional Budget Office (CBO) published a report entitled “Options for Changing the Tax Treatment of Charitable Giving.” While the deduction of charitable donations has historically been a feature of the U.S. individual income tax system, the cost, equity and efficiency of the deduction are now the focus of increased scrutiny.
Did you receive an IRS tax audit for your vineyard?
Code Sec. 179 expensing has become a potent tax saver, thanks to current law’s $500,000 deduction ceiling. So it should come as no surprise that taxpayers and their advisers are on the lookout for assets that potentially qualify as Code Sec. 179 property eligible for expensing. One such class of property is vineyards and orchards. IRS has published an Audit Techniques Guide (ATG) turning a thumbs down on expensing for such property, but its conclusion appears to be based on prior law. A more recent ATG leaves the door open to a better result. This Practice Alert presents the case for treating vineyards and orchards as Code Sec. 179 property and covers IRS’s current “conflicted” guidance as well.
For anyone not familiar with the inner workings of tax administration, the array of IRS guidance may seem, well, a little puzzling at first glance. To take a little of the mystery away, here’s a brief look at seven of the most common forms of guidance.
In its role in administering the tax laws enacted by the Congress, the IRS must take the specifics of these laws and translate them into detailed regulations, rules and procedures. The Office of Chief Counsel fills this crucial role by producing several different kinds of documents and publications that provide guidance to taxpayers, firms and charitable groups.
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Most taxpayers assume that they need a tax attorney or a tax lawyer to respond to an IRS notice or letter. Taxpayers with tax problems should consider EAs (Enrolled Agents) who specialize in tax relief and tax problem resolution.
Looking for a tax relief attorney? Our firm is headed by Mike Habib, he is an EA who specializes in tax relief and can resolve your tax problems such as releasing tax levies, stopping wage garnishments, IRS audit representation, 941 payroll tax matters, etc. Tax attorneys and criminal lawyers should be considered by the taxpayers facing criminal charges. The vast majority of tax problems in need of tax relief are civil matters, and our firm can represent you before all administrative levels of the IRS. You will need a tax criminal attorney if you’ve been visited by a criminal or special agent.
Are you looking for tax problem help? As we all know, the American economy is still stagnant and depressed, 2011 has been the toughest year for most individual and business taxpayers seeking tax problem help. Unemployment is still high, family incomes are lower, business income is slashed and retirement savings have significantly declined and the reality is many taxpayers are struggling to make ends meet. The American government has provided a variety of tax resolution programs to help you resolve your tax problem, and I urged you to take advantage of these tax relief options as well as other strategies to resolve your tax problem and get peace of mind.
When you need tax relief help you may have to hire a tax professional to get the job done right. Even though there are several types of tax professionals such as CPAs, tax attorneys, tax lawyers, Enrolled Agents can do a lot for you on many levels. Mike Habib, EA is an Enrolled Agent who provides tax relief services in Whittier, La Habra, Hacienda Heights, Rowland Heights, La Mirada, City of Industry, La Habra Heights, Montebello, El Monte, Downey, Pico Rivera, Cerritos, Long Beach, Fullerton, Placentia, Brea, Buena Park, and other southern California cities.
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The following is a summary of the most important tax developments that have occurred in the past three months that may affect you, your family, your investments, and your livelihood. Please contact us for more information about any of these developments and what steps you should implement to take advantage of favorable developments and to minimize the impact of those that are unfavorable.
IRS has issued detailed guidance on the 2010 Tax Relief Act’s 100% bonus depreciation rules for qualifying new property generally acquired and placed in service after Sept. 8, 2010 and before Jan. 1, 2012. Overall, the rules are quite generous. For example, they permit 100% bonus depreciation for components where work on a larger self-constructed property began before Sept. 9, 2010, allow a taxpayer to elect to “step down” from 100% to 50% bonus depreciation for property placed in service in a tax year that includes Sept. 9, 2010, permit 100% bonus depreciation for qualified restaurant property or qualified retail improvement property that also meets the definition of qualified leasehold improvement property, and provide an escape hatch for some business car owners who would otherwise be subject to a draconian depreciation result.
Under the 2010 Tax Relief Act, a taxpayer that buys and places in service a new heavy SUV after Sept. 8, 2010 and before Jan. 1, 2012, and uses it 100% for business, may write off its entire cost in the placed-in-service year. A heavy SUV is one with a GVW rating of more than 6,000 pounds.
Help with IRS Payroll Tax Problems
If you own or manage a business (sole proprietor, partnership, or corporation) and pay employees, you will have to deal with 941 and 940 payroll taxes (employment taxes). Social Security, Medicare and income tax withholding from employee paychecks is just part of normal business operations. If you fail to file and pay your 941 payroll taxes then you are guaranteed to get in trouble with the IRS and the other state agencies such as EDD. This usually leads to additional stiff IRS penalties and larger tax debt, and may also be considered by the IRS a federal crime.
The IRS may compromise the taxpayer’s back tax liability in most civil or criminal cases before referral to the Department of Justice for prosecution or defense. The Attorney General or a delegate may compromise any tax case after the referral. However, the IRS may not compromise certain criminal liabilities arising under internal revenue laws relating to narcotics, opium, or marijuana. Interest and penalties, as well as tax, may be compromised (Code Sec. 7122; Reg. §301.7122-1). IRS Offers-in-compromise are submitted on Form 656 accompanied by a financial statement on Form 433-A for an individual taxpayer or Form 433-B for a business taxpayer (if based on inability to pay) (Reg. §601.203(b)). A taxpayer who faces severe or unusual economic hardship may also apply for an offer-in-compromise by submitting Form 656. If the IRS accepts an offer-in-compromise, the payment is allocated among tax, penalties, and interest as stated in the collateral agreement with the IRS. If no allocation is specified in the agreement and the amounts paid exceed the total tax and penalties owed, the payments will be applied to tax, penalties, and interest, in that order, beginning with the earliest year. If the IRS agrees to an amount that does not exceed the combined tax and penalties, and there is no agreement regarding allocation of the payment, no amount will be allocated to interest.
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