Under IRC section 6676, the IRS has the authority to assess penalties against taxpayers for making erroneous claims for refund or credit. In a 2013 report, the Treasury Inspector General for Tax Administration found that the IRS had only imposed the excess refund penalty 84 times in the first six years after its enactment. That same report recommended that the IRS increase assessment of the penalty such that it would apply to over 575,000 taxpayers each year; however, the IRS did not expand enforcement to these levels [“The Law Which Penalizes Erroneous Refund and Credit Claims Was not Properl ..read more

The Inflation Reduction Act of 2022 (IRA; PL 117-169) was signed into law on August 16, 2022. This massive measure, which is intended to tamp down inflation and reduce the federal budget deficit, includes many tax provisions affecting individuals and businesses. Most of the provisions become effective in 2023 or later, but some will impact 2022 returns. Tax Changes for Individuals The changes for individuals impact healthcare and green energy. Premium tax credit. Individuals who purchase their health coverage from the government marketplace may qualify for a premium tax credit. The credit may ..read more

In Brief Professional accountants continued to deal with practice-related, economic, social, and tax law changes resulting from the global pandemic during the 2022 busy season, as well as a continuation and worsening of issues from 2021. IRS staff shortages contributed to long waits to reach IRS helplines and a ballooning backlog of unprocessed returns, which created a challenging environment for practitioners. CPAs kept up with tax law and pandemic-related changes, and they developed expertise in newer areas such as cryptocurrency to assist clients. Many participants in this year’s survey h ..read more

The Inflation Reduction Act of 2022 (IRA; PL 117-169) was signed into law on August 16, 2022. This massive measure, which is intended to tamp down inflation and reduce the federal budget deficit, includes many tax provisions affecting individuals and businesses. Most of the provisions become effective in 2023 or later, but some will impact 2022 returns. Tax Changes for Individuals The changes for individuals impact healthcare and green energy. Premium tax credit. Individuals who purchase their health coverage from the government marketplace may qualify for a premium tax credit. The credit may ..read more

In Brief Professional accountants continued to deal with practice-related, economic, social, and tax law changes resulting from the global pandemic during the 2022 busy season, as well as a continuation and worsening of issues from 2021. IRS staff shortages contributed to long waits to reach IRS helplines and a ballooning backlog of unprocessed returns, which created a challenging environment for practitioners. CPAs kept up with tax law and pandemic-related changes, and they developed expertise in newer areas such as cryptocurrency to assist clients. Many participants in this year’s survey h ..read more

The Inflation Reduction Act of 2022 (IRA; PL 117-169) was signed into law on August 16, 2022. This massive measure, which is intended to tamp down inflation and reduce the federal budget deficit, includes many tax provisions affecting individuals and businesses. Most of the provisions become effective in 2023 or later, but some will impact 2022 returns. Tax Changes for Individuals The changes for individuals impact healthcare and green energy. Premium tax credit. Individuals who purchase their health coverage from the government marketplace may qualify for a premium tax credit. The credit may ..read more

On March 31, 2021, former New York Governor Andrew Cuomo signed the Marijuana Regulation and Taxation Act (MRTA), creating a new Tax Law Article 20-C that legalizes and taxes the sale of adult-use marijuana by persons age 21 or older. Broadly speaking, the provisions of MRTA apply to the adult use of marihuana other than for medical purposes [MRTA section 39, adding new Tax Law Article 20-C section 492(a),(b)]. Taxation MRTA provides for the taxation of all parts of the cannabis plant as follows: The sale of adult-use cannabis products sold by a distributor to a person who sells adult-use ca ..read more

As inflationary pressures continue to mount (e.g., 8.3% for the 12-month period ending April 2022), individuals may look to their financial advisors for practical and, where possible, tax-advantaged strategies for addressing this challenging environment. United States I Bonds may potentially allow advisers to address these concerns by serving not only as vehicles for immediate inflation protection, but also as a foundation for achieving long-term tax savings. Key benefits of I Bonds, beyond offering what is often an above-market interest return (9.62% annual rate, recomputed semi-annually, for ..read more

CPAs need to be aware of current tax developments in key states to properly advise entities doing business in multiple jurisdictions. Below is an overview of some key developments in the state of California. On February 9, 2022, California Governor Gavin Newsom signed legislation that, among other coronavirus (COVID-19) relief measures, expands the pass-through entity (PTE) tax, restores the net operating loss (NOL) deduction and business tax credits, and provides relief for restaurant and venue operators, just in time for the March 15, 2022, filing deadline (SB-113 Economic Relief: COVID-19 ..read more

Two years into an unprecedented global pandemic, the impact of coronavirus (COVID-19) is still felt in many industries. The hospitality industry continues to be one of the hardest-hit. Although hotel occupancy is steadily rising as summer travel picks up, the restaurant industry struggles to reestablish its identity. The lack of workers, the lack of supplies, and the lack of customers all contribute. The National Restaurant Association estimates that at least 90,000 restaurant locations were either temporarily or permanently closed as of mid-2021 (The 2021 State of the Restaurant Industry Mid ..read more