Seems IRS’ recent deportment in dealing with Microsoft has got Senate Finance Committee Chairman Orrin Hatch (R-UT) all riled up. Hatch wrote to Commissioner Koskinen, last week, complaining of IRS’ use of a private law firm to help out in a pending audit of the software giant.
Under the law, of course, IRS is empowered to make inquiries, and eventually assessments of taxes, relative to a taxpayer’s income tax return filings. And in this regard, IRS can examine books and records, and take testimony for purposes of determining the propriety of a return which has been filed. IRS can also issue summonses, ordering taxpayers to appear before IRS, and to produce books, records and to render testimony.Read More
Those of you out there who think Section 1031 solves all problems (Federal as well as state) should not lose sight of California’s requirements.
Recall that this section of the Internal Revenue Code permits a bloke (who dots all of the i’s and crosses all of the t’s) to dispose of his investment real estate, replace the old property generally with property of equal or greater value, and thus defer current recognition of the gain on the sale. And California has long observed generally the same rules.Read More
Or so they say. So here comes the Treasury Secretary for Tax Administration (TIGTA) to check the situation out.
Recall that TIGTA had previously found that ineffective IRS management has resulted in (1) inappropriate criteria being used to identify for review organizations applying for tax exempt status based on names and policy positions instead of indications of political campaign intervention, (2) substantially delayed processing of certain applications, and (3) unnecessary information requests being issued by the Revenooers.Read More
So here comes another taxpayer tale of woe from our “no good deed goes unpunished” department.
Seems Elroy Earl Morris was the primary and sole beneficiary of a traditional IRA owned by his Dad, and when the old guy passed on, Elroy got the dough from the Farm Bureau Life Insurance Co. of Michigan, which reported the payments to him on a Form 1099R, as usual. Elroy also sought some advice from a local law firm, relative to the settlement of the estate, and was told by a paralegal that there would be no tax due – referring to Federal and state estate taxes, which seems to have slipped by Elroy’s understanding which is what may have led him to omit the distributions from his income tax return.
Further, implementing what he believed to be his father’s wishes, he passed some of the IRA money along to two of his siblings in the aggregate amount of $37,000.Read More