Blog Archives

2015 Listed Property Limits for Autos, Trucks & Vans

Tax practitioners often times tend to judge each other by the quality of our client's respective asset lists and depreciation schedules. Truth is MANY practitioners get listed property limits WRONG because they simply do not understand the limits. Hence this

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Posted in Asset Classification, Auto, Business Expense, Car expense, Depreciation, Passenger Vehicle

Final Tangible Property Regulations Necessitate that Many Businesses Apply for Change Of Accounting Method: IRS Form 3115; Rev Procs 2015-13 & 2015-14

Back in June 2014 I blogged about the new IRS Regulations governing tangible personal property. These regulations prompted a vigorous debate over the last 7 months between the most astute students of the US Tax Code as to what constitutes

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Posted in Accounting Method, Asset Classification, Basis, Business Expense, Capital Gain, Capital Loss, Cost Basis, Cost Segregation, Deductible Expense, Depreciation, Tax Guidance & Preparation

Use IRS Form 8082 to Report An Incorrectly Issued K1

This post address how to use IRS Form 8082 to report an incorrectly issued K1. The lesson learned is that you always start by requesting in writing that a corrected K1 be issued. I've been working a very complicated file

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Posted in 1231 Exchange, Asset Classification, Audit Reconsideration, Business Income, Capital Loss, Distributions, IRS Appeal, IRS Audit, IRS Collections, IRS Enforcement, K1, Partnership, Passive Activity, Sub-chapter S, Tax Guidance & Preparation, Tax Problems & Requests, Uncertain Tax Position

Tangible Assets Used In Converting Corn To Fuel Grade Ethanol Are Properly Included In Asset Class 49.5

A certain important person in my reality - my wife - is becoming increasingly interested in the business end of biomass refineries. You go girl. Funny but this interest also happens to correlate with a new file I am developing

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Posted in Asset Classification, Depreciation, Husband/Wife, Tax Guidance & Preparation, Tax Problems & Requests, Uncertain Tax Position

Buying or Selling Business Assets – Remember to File IRS Form 8594 & Avoid Future Headaches

The Perturbing New Treatment of Patents Under the Tax Cut & Jobs Act (TCJA)

Buying or Selling Business Assets - Remember to File IRS Form 8594 & Avoid Future Headaches Buying and selling business assets can be complicated.  The last thing you want - BELIEVE ME - is the hassle of explaining inconsistent treatment

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Posted in Asset Classification

General Rules for S-Corporation Distributions A Random Walk Down IRC 1368

Unless you elect different treatment, for shareholder income tax purposes S corporation distributions are applied in the following order: 1. To reduce the Accumulated Adjustment Account (AAA) determined without regard to any net negative adjustment for the tax year but

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Posted in Asset Classification, Capital Gain, Corporation, Income, Self Employ, Small Business, Sub-chapter S, Tax Guidance & Preparation, Tax Preparer, Tax Problems & Requests

IRS Regulations on Deduction and Capitalization of Tangible Assets

The IRS has issued final regulations affecting all taxpayers that acquire, produce, or improve tangible property. The final regulations define materials, supplies, de minimus, safe harbor and related repairs as well as the election to capitalize certain materials and supplies among

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Posted in Asset Classification, Cost Basis, Deductible Expense, Tax Deductible Expenses, Tax Guidance & Preparation, Tax Problems & Requests

Trafficking under IRC § 280E

Business Entity Selection and the Tax Consequences of Converting

The Internal Revenue Code is a complex beast.  In the lunacy of it all I've been asked to define 'trafficking' as it relates to 26 USC § 280E - Expenditures in connection with the illegal sale of drugs which states as follows: "No

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Posted in Appeals & Audit Resolution, Asset Classification, Business Expense, Cash Transaction, COGS, IRS Mediation, Marijuana, Net Operating Loss, NOL, Tax Abuse, Tax Court, Tax Guidance & Preparation, Tax Problems & Requests

Tax Treatment of Charitably Donated Artwork

Please refer to IRC 170 as well as Publication 526, Charitable Contributions (PDF), Publication 561, Determining the Value of Donated Property (PDF), and Publication 1771, Charitable Contributions Substantiation and Disclosure Requirements (PDF) for detailed information on charitable contributions. This is what I've learned about issues involving charitable contributions

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Posted in Artists, Asset Classification, Basis, Capital Gain, Charitable Contribution, Cost Basis, Estate Tax, Tax Abuse, Tax Guidance & Preparation
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