IRS vs. NJ Battle Continues

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IRS Reiterates Its “Prepaid Property Tax” Position for NJ Under the Tax Cuts and Jobs Act (TCJA), enacted on December 22, 2017, a taxpayer’s itemized deduction for state and local taxes for the tax years 2018-2025 is limited to $10,000 ($5,000 for married filing separately) per year. This new limitation was particularly burdensome for taxpayers […]

Additional IRS Guidance Expected on the New Sec. 199A Qualified Business Income Deduction

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The Tax Cuts and Jobs Act (TCJA), which was enacted in December 2017, included a new deduction for 20% of qualified business income passing through to equity owners from enterprises electing to be taxed as pass-through businesses (i.e., S corporations, partnerships and sole proprietorships). Under the new tax reform provisions, non-corporate taxpayers may deduct up to […]

Tax Court Disallows Charitable Deduction of Remainder Interest

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In a very significant case, the United States Tax Court found that a limited liability company (LLC) was not entitled to a charitable contribution deduction for the donation of a remainder interest in real property because it failed to adequately substantiate its claimed deduction. The Form 8283 (appraisal summary for noncash charitable contributions) the LLC […]

Income Tax Law (NOT a Divorce Decree), Determines Dependency Exemption

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A common element of every marital dissolution, where the divorcing parties have minor children, is the financial consideration and accountability of federal income tax savings associated with the dependency deductions under the law. Creativity within divorce settlements can provide for any number of ways in which this issue is addressed. However, as one recent Tax […]

noncash charitable contributions, deductions, IRS, tax court

Maximizing Noncash Charitable Contribution Tax Deductions

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It is not at all unusual for individual taxpayers to work to reduce their tax liabilities by donating to charity used personal items such as furniture, clothing and household goods that still have some value and utility left in them. A recent Tax Court case, however, demonstrates how excessive noncash charitable contributions can draw the […]

Ralph Lauren, tax court, taxpayer, GYF, Grossman Yanak & Ford LLP, Pittsburgh, CPAs

Looking to Deduct Your Wardrobe? Be careful!

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In a recent Tax Court decision, the taxpayer, who resided in New York, began employment as a salesman for clothing designer, marketer and distributor Ralph Lauren. That Company required all employees who worked in corporate sales positions to wear Ralph Lauren apparel while representing the Company.  Consequently, the taxpayer purchased Ralph Lauren shirts, pants, ties […]

Deducting Meals and Entertainment Expenses

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Deducting business expenses for meals and entertainment can yield significant tax savings. The critical elements to realizing these tax benefits are understanding the somewhat-complex tax rules and maintaining proper substantiation. Entertaining clients or customers is simply a normal part of business and is well recognized within tax literature as being a “cost” of doing business. […]

IRS, charitable contribution, GYF, Grossman Yanak & Ford LLP, Pittsburgh, CPAs

IRS Backs Off Controversial Alternative Charitable Contribution Substantiation Regulations

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To the chagrin of the charitable organization community, the Internal Revenue Service (IRS) issued new reporting rules introduced in the fall of 2015. Those proposed regulations were intended to implement the exception to the “contemporaneous written acknowledgement” requirement for substantiating charitable contribution deductions of $250 or more. The proposed regulations provided a new option for […]