The Internal Revenue Code provides several meaningful tools to ease the tax pain when a business fails. The problem is that many of these provisions require advance planning, timely action, or both. If you’re not looking for them, you’ll miss them, and your client will pay for it. In this article, we’ll look at net operating losses, Section 1244, worthless stock and bad debts, the hobby loss rules, cancellation of debt, and key opportunities to look back at prior years.

Life insurance is such a great income tax deal that it really disturbs me when people manage to create income tax nightmares with it. The build-up in value of a whole life policy is not currently taxed if the policy is properly structured. And even better, except for the insured, the proceeds are totally income tax free when paid because of the death either actual or clearly coming soon of the insured. Of course one of the greatest pieces of marketing genius ever was calling it life insurance, as it is in its pure form, actually death insurance. Here are some stories of life insurance tax nightmares and we’ll see if we can draw a moral from them.

For me, the most exciting Tax Court opinion of 2025 was Judge Joseph Goeke's supplement to his 2024 opinion in the case of Gary M. Schwarz. With a $1,851,878 tax deficiency, it is the largest hobby loss opinion since 2019. (The really big dollar cases tend to settle.)

The most successful accountants aren’t the ones who pitch the hardest, they’re the ones who listen the most. When you ask better questions, you can diagnose problems that clients didn’t even know they had, which then helps us clarify outcomes instead of listing services. When we shift from “convincing” to “consulting,” discovery calls stop being “sales” conversations and start becoming advisory conversations. And advisory conversations naturally lead to advisory engagements.

Tax pros help clients with a lot of catastrophes: wrangles with tax authorities, paltry nest eggs, more wrangles with tax authorities. More frequently, your clients might face a more tangible and cinematic disaster. These days, there’s always a storm comin’. Swept away in that destruction, for many people, are physical tax and financial records. A few precautions could have prevented such loss and made life at least a bit easier for victims. Here’s how to help clients head off trouble – and recover after it hits.

The Cohan rule is named for George M. Cohan. George Michael Cohan (1878 – 1942) was a theatrical producer. In the decade before World War I, he was called the “man who owned Broadway” and is considered the father of American musical comedy. In 1940 he was awarded the Congressional Gold Medal for his contribution to morale during World War I with his songs “You’re a Grand Old Flag” and “Over There,” the first time the medal was awarded to someone in an artistic field. But his most enduring legacy may be the tax rule that shared its name.

Let’s be direct: AI is one of the most powerful capacity tools tax professionals have seen in decades. Used correctly, it buys you time you can reinvest into high-value advisory: planning, structuring, audits, negotiations, strategy, client education, and relationship building. But here’s the catch that you as an elite tax practitioner already understand: aggressive planning requires rigorous defensibility. If you’re going to use AI to accelerate complex planning work, your defense file must be stronger, not weaker. This playbook gives you that: a practical framework that keeps you safe while you scale.

The mere mention of a WISP makes most tax professionals want to suddenly lose their internet connection. It sounds bureaucratic, technical, and deeply unfun. But here’s the good news: creating and maintaining a WISP does not have to feel like a compliance root canal. And ignoring it can turn into something far worse than an IRS audit. Let’s talk about why you need one, what it’s actually supposed to do, and how to get it done without wrecking your sanity in the middle of filing season.