New Law Designed to Improve the IRS and Protect Taxpayers

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President Trump has signed the Taxpayer First Act of 2019 (H.R. 3151), which alters the management and oversight of the Internal Revenue Service (IRS) with the aim of improving customer service and the appeals process. The Act also provides new confidentiality safeguards as taxpayers interact with the IRS. The Taxpayer First Act includes provisions that: […]

IRS Sets 2019 Vehicle Depreciation Limits  

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The Internal Revenue Service has released the depreciation deduction limits for passenger autos (including trucks and vans) first placed in service during 2019. These annually inflation-adjusted numbers represent the maximum income tax depreciation allowed under the luxury automobile rules. In Revenue Procedure 2019-26, tables set forth the new depreciation limits. Table 1 provides the depreciation […]

Internal Revenue Service sets 2020 limits on HSA contributions

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The IRS recently announced the annual inflation-adjusted limits on deductions for contributions to a health savings account (HSA) allowed for taxpayers with individual or family coverage under a high-deductible health plan (HDHP) for calendar year 2020. Under Internal Revenue Code Sec. 223, individuals who participate in an HDHP are permitted a deduction in computing their […]

Annual Tax Data Book Released by the Internal Revenue Service

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The Internal Revenue Service recently released its 2018 Data Book, which summarizes that agency’s operating activity for fiscal-year 2018 (October 1, 2017 through September 30, 2018). Always interesting, the Book notes that during this period, the IRS collected nearly $3.5 trillion in revenue and processed more than 250 million tax returns and other forms and […]

New Proposal to Tax Unrealized Capital Gains

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An occasionally-discussed income tax concept relating to capital gains is being revived by the top-ranking Democrat on the Senate Finance Committee, Oregon Senator Ron Wyden. Wyden is proposing that certain wealthy taxpayers ante up each year for the value growth in their investment accounts rather than waiting for those investment assets to be liquidated and/or […]

IRS Reform Package Offered by Bipartisan Members of the House Ways and Means Committee

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This week a bipartisan measure was passed by House Ways and Means Committee members.  The bill includes  measures designed to protect taxpayers from unfair practices and improve Internal Revenue Service (IRS) operations. The bill, HR 1957, is intended to redesign the operational structure of the IRS with the intent of making the agency more efficient […]

Joint Committee on Taxation Addresses the QBI Deduction

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One of the most discussed provisions of the Tax Cuts and Jobs Act (TCJA), which was enacted in December 2017, is the addition of the Qualified Business Income (QBI) deduction available under new Internal Revenue Code §199A. This provision allows equity owners of qualifying pass-through entities to deduct up to 20% of the qualifying business […]

Substantiation Rules for Charitable Contributions Continue to Baffle

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As April 15th (the annual D-Day for U.S. taxpayers) is rapidly approaching, confusion still exists as to how to properly substantiate a donation or charitable contribution to a qualifying tax-exempt organization. The lack of clarity relates mostly to a seemingly endless series of technical changes to the substantiation requirements by the Internal Revenue Service. Obtaining […]

State and Local Tax Refunds & the Tax Benefit Rule

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In years prior to 2019, and the enactment of the Tax Cuts and Jobs Act (TCJA), taxpayers were accorded an “unlimited” federal income tax deduction for all state and local income taxes as well as real estate taxes, if they were able to itemize deductions. In those instances when the state and local income taxes […]

No Tax Increases Proposed in Governor’s Budget

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Pennsylvania Governor Tom Wolf recently proposed a 2019 – 2020 state budget.  The good news, initially, is that the Governor did not include any call for increased state income and sales taxes and, in fact, contains proposals to reduce the corporate state income tax as a means of making the Commonwealth more competitive in drawing […]