So You Want To Convert That Second Home To A Rental

- By : jquinn

  A recent decision of the Tax Court (in the Redisch case) reminds us of how a bloke has to act with respect to the “conversion” of that vacation home to a rental property, entitling the taxpayer to the potential tax benefits of that rental loss, and the possibility of even deducting a loss upon

Revenooers’ End Run On Microsoft

- By : jquinn

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

California Special Rule For 1031 Exchanges

- By : jquinn

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,

IRS Cleans Up Tax Exempt Application Process

- By : jquinn

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

Tax Court Unimpressed with Good Deed

- By : jquinn

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

Time For Estate Tax To Go

- By : jquinn

That’s what the Tax Foundation is saying, and it may just be that the powers that be are listening for a change. Generally speaking, the Foundation says estate and inheritance taxes are poor economic policy, because for the most part they hit accumulated capital which makes America richer and more productive as a whole.  These

IRS Still Muddling Around With The Identity Theft Problem

- By : jquinn

  Victims of identity theft are still coming out on the short end of the stick insofar as the IRS is concerned.  So says the Treasury Inspector General for Tax Administration (TIGTA). In an audit report released last week, TIGTA noted that IRS has not been providing quality customer service to identity theft victims, when

Consumption Tax On The Horizon?

- By : jquinn

Who’s to say?  It could happen. So saith The Wall Street Journal, last week, quoting Senator Ben Cardin (D, MD), co-chairman of a Senate Finance Committee working group looking into this plan in the context of the often-mentioned overhaul of the tax system, which should come sooner rather than later. Cardin actually introduced legislation, last

IRS: Thou Shalt Not Skim!

- By : jquinn

That’s the message to taxpayers from the recent Tax Court decision in the Musa case. The story is that this bloke owned a restaurant, and decided to simply not report as revenue significant amounts of cash which he skimmed from the restaurant’s take.  If that were not enough, he also apparently lied to his accountant

IRS Has Dough Waiting For You!

- By : jquinn

That’s right – they just can’t wait to send you money, if you’re one of the million or so blokes who hasn’t yet filed for the 2011 tax year and are entitled to a refund.  And by IRS’ reckoning, those as yet unclaimed refunds total about a billion or so! In situations where a tax

Old Guys Rule

- By : jquinn

When it comes to Social Security, that is.  So saith the Social Security Administration’s (SSA) Inspector General, who recently stumbled across the fact that something like 6.5 million folks, age 112 or older, have active Social Security Numbers! The audit, released in early March, concluded that SSA lacks the controls necessary to find out about

IRS Allows Breathing Room For Slot Players

- By : jquinn

A little good news from the Revenooers this week, for those of you who indulge in slot machine play.  Here comes a proposed Revenue Procedure which, if finalized, would allow you to use an optional “safe harbor” in determining your wagering gains and losses. Longstanding IRS regulations say that gains from wagering transactions are included

Some IRA Early Distributions Escape Penalty Revenooer Rants

- By : jquinn

Generally speaking, distributions from IRAs before one reaches age 59-1/2 trigger a penalty for early withdrawal – the Revenooers want you to keep the dough in the account until you are truly long in the tooth and truly need the money to support yourself in retirement. But for any number of reasons, a bloke may

Revenooers Reveal the “Naughty 12” Revenooer Rants

- By : jquinn

Or is it the “Dirty Dozen?” In any case, beware of the IRS’ most worrisome tax scams, the more egregious of which are: Phone scams – These are aggressive and threatening phone calls by criminals impersonating IRS agents.  The scam artists threaten police arrest, deportation, license revocation and other similar nasty results  if you don’t

Taxpayer Advocate Not Happy Revenooer Rants

- By : jquinn

In her annual report to Congress, National Taxpayer Advocate Nina Olson paints a bleak picture of the IRS, in general, and its interaction with taxpayers.  She emphasizes four broad areas of concern: The budget environment of the last five years has resulted in a “devastating erosion of taxpayer service.”  (No argument from us on that

Some IRS Hires Not Choir Boy Candidates Revenooer Rants

- By : jquinn

  So saith the Treasury Inspector General for Tax Administration (TIGTA) anyway. Seems TIGTA recently found in one of its audits that between 2010 and 2013, hundreds of former employees were rehired for whom IRS records show performance and conduct issues associated with their previous IRS employment.