Articles Archive - Page 29 of 79 - Think Outside the Tax Box

Articles

What Clients Should Know About Innocent Spouse Relief

Leave a Comment / By

Some clients marry into tax trouble – and then have no clue how to get out. Others are on the cusp of a separation or divorce and want the uncoupling (at least in the eyes of tax authorities) to start ASAP. Few clients who need the IRS tool called “innocent spouse relief” to unshackle themselves from a spouse’s tax mess (either one that spouse brought to the marriage or one they racked up later) seem to know about it. Here’s what to tell such a client about what this relief does and does not cover and what your client will have to prove before they can qualify – as well as how difficult this relief can be to get.

What Clients Should Know About Innocent Spouse Relief Read More »

Life Cycle of a Cost Segregation Study

Leave a Comment / By

The concept of cost segregation began in the 1960s, when taxpayers argued specific components of real estate had a shorter life than the depreciation tables allowed (39 years for commercial property and 27.5 years for residential real estate). After decades of legal cases, the IRS provided rules and safe harbors in 1996 and 2002. Taxpayers now can use cost segregation and remain compliant with IRS regulations. The real question now is: Does a cost segregation study really reduce a taxpayer’s liability? And if so, by how much?

Life Cycle of a Cost Segregation Study Read More »

Three Rules for the Augusta Rule

Leave a Comment / By

Today I want to talk about the quick question, “Can I rent my home to my business tax free?” The answer is not straightforward. It takes time to look at the specific set-up of that taxpayer’s business. It requires a bit of research. You need to know things like:
● What’s the fair market value of renting your home?
● How many days will you rent your home to your business?
● Can we substantiate that this rental is ordinary and necessary?

Amber Gray-Fenner already did an excellent job of explaining the Augusta Rule in an earlier issue of the newsletter. So, I won’t go over all the same points. I want to look at what the Augusta Rule is and how it came about. Then, we’ll look at three takeaways for you to remember in your practice and give to your clients.

Three Rules for the Augusta Rule Read More »

Death and Taxes: What Clients Should Know About the Death of a Spouse

Leave a Comment / By

Even your most financially savvy client isn’t going to think clearly after the death of their spouse. Taxes will be last on their minds. That’s where you’ll come in, nudging them toward tax and money moves both immediate and long-term, from filing returns to budgeting income to taking a step-up in basis. Above all, don’t assume grieving clients know these details or that they’ll remember them in one of life’s toughest moments.

Death and Taxes: What Clients Should Know About the Death of a Spouse Read More »

Looking Bad for Investors in Syndicated Conservation Easements

Leave a Comment / By

Albert Lauber, my favorite Tax Court judge, gave us an opinion in February that paints a detailed picture of the workings of a syndicated conservation easement. In the end, he supports the findings of the Senate Joint Finance Committee that the engine of these abusive transactions is an inflated appraisal. In November, David Gustafson issued an opinion that exposed the financial engineering techniques that promoters engaged in. We’ll take a look at those, but first I would like to give you an overview, because we may need that to figure out the lessons to be learned.

Looking Bad for Investors in Syndicated Conservation Easements Read More »

Avoid IRS Red Flags in Multiple Business Strategies: A Guide for the Wary Tax Business Owner

Leave a Comment / By

In the labyrinth of tax planning and business structure, the path to protecting your client’s multiple business strategy from the ever-watchful eye of the IRS can be as intricate as a well-played game of chess. However, while the strategic moves might be complex, the rules of the game are quite clear. Today, let’s dissect these rules with a blend of cautionary tales and cheeky wisdom, ensuring your business maneuvers stay sharp and IRS-compliant.

Ever heard of the tax strategy to just “create a new C corporation” and shift income by paying management fees from your main company? Well, so has the IRS, and they are highly skeptical when they see it in the field. The Aspro, Inc. v. Commissioner case serves as a stark reminder for taxpayers about the importance of meticulous documentation and the strict adherence to IRS guidelines for deducting management fees. Aspro, an Iowa-based C corporation in the asphalt-paving business, faced scrutiny over its practice of paying “management fees” to its shareholders, which the IRS and subsequent court rulings reclassified as non-deductible disguised dividends.

Avoid IRS Red Flags in Multiple Business Strategies: A Guide for the Wary Tax Business Owner Read More »

Scroll to Top

turn new laws into new opportunities download our FREE ebook

 

Download Our FREE Magazine!

Download Our FREE Magazine!

Thank you for subscribing to Tax Law Pro

You are granted a non-exclusive, non-transferable, revocable license to access and use Tax Law Pro by Think Outside the Tax Box, Inc., strictly according to these terms of use.