Archive: Tax

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Inherited an IRA? It’s Not Always 100% Taxable

Beneficiaries of an inherited individual retirement account (IRA) are typically not privy to the income tax filings of the decedent. The result is that some beneficiaries end up paying more tax on their inherited IRA distribution than was required. How does this happen? One answer: basis. Unlike other assets, the basis of an IRA in […]

Maryland Comptroller Clarifies GILTI Treatment

On April 17, 2019, the Comptroller of Maryland issued a Tax Alert to provide guidance to taxpayers on the state’s taxation of global intangible low-taxed income (GILTI), a new category of foreign earnings subject to federal income tax as a result of provision enacted by The Tax Cuts and Jobs Act (TCJA). The Tax Alert […]

Artificial Intelligence to Help Resource-Strapped IRS More Efficiently Identify Tax Crimes

Tax criminals beware: like the hosts in Westworld, the Internal Revenue Service (IRS) is becoming sentient! The IRS is now using artificial intelligence (AI) technology to more efficiently detect tax fraud, hidden assets, money laundering, identity theft, and other noncompliance. In the past, instances of tax-related criminal activity had to be manually discovered by revenue […]

The Accuracy-Related Penalty: New Disclosure Requirements

The Internal Revenue Service (IRS) has issued Revenue Procedure 2019-9, which outlines disclosure requirements to reduce or avoid accuracy-related penalty. This procedure applies to all tax returns prepared on 2018 forms. The accuracy-related penalty under Internal Revenue Code (IRC) 6662 is imposed if there is a substantial understatement of tax, defined for corporations as a […]

Tax Saving Strategy: Hire Your Kids

One often overlooked tax saving strategy is to hire your children to work for your business, assuming they can legally work (e.g., age, permits, etc.). This can be a great opportunity to save money. Not only are your children’s wages deductible as a business expense, but there are also opportunities to save money on income […]

Last-Minute Proposed Tax Legislation

On November 26, 2018 House Ways and Means Committee Chairman Kevin Brady (R-TX) released the Retirement, Savings, and Other Tax Relief Act of 2018 and the Taxpayer First Act of 2018. These two pieces of legislation could have a major impact on individuals and small businesses. Key proposals in the Retirement, Savings, and Other Tax […]

Let Uncle Sam Help You Expand Your Real Estate Portfolio by Utilizing the 1031 Like-Kind Exchange

There are many tax-deferral strategies used by successful investors. One of those tax instruments is the code Section 1031 Like-Kind Exchange. Businesses are able to exchange assets used in a trade or business and defer paying taxes on gains from the sale of real property. Previously, businesses were able were able to exchange personal property […]

Tax Reform 2.0 Passes the House

Making important headway on the proposals outlined in the legislative framework for tax reform 2.0, the U.S. House of Representatives approved the following three bills in September: R. 6760 – Protecting Family and Small Business Tax Cuts Act of 2018: The bill is intended to make permanent various individual tax provisions and Section 199A deduction […]

Wage Hike for D.C. Servers, Bartenders Gets Repealed: What Restaurant Owners Need to Know

On October 23, D.C. Mayor Muriel Bowser signed legislation to overturn Initiative 77, which would have established a higher minimum wage for service workers who rely on tips for the majority of their incomes. This move comes after the D.C. Council voted 8-5 in favor of the repeal the week prior, as well as after […]

Wayfair’s Impact on Multistate Income Taxes

States have acted quickly in response to the U.S. Supreme Court’s decision in South Dakota v. Wayfair, Inc. Many have already enacted sales and use tax nexus rules that will enable them to require more out-of-state retailers to collect sales tax.  Such a quick response is understandable, as states do not want to miss out on […]
October 25, 2018