Archive | Tax

Health Savings Account Parameters for 2018

By on May 17, 2017

The Internal Revenue Service has announced 2018 cost of living adjustments for health savings accounts (HSAs) under current law. For those with HSAs, a high deductible health plan must have a deductible of at least $1,350 (up from $1,300 in 2017) and total out of pocket expenses (deductibles, co-payments, and other amounts, but not premiums) […]

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Robert Warwick

Another Tax Trap for the Unwary – Tax Court and the Blank Receipt

By on October 23, 2014

As a general rule, the fair market value of property contributed to charity is deductible in determining taxable income. However, deduction is contingent on the donor’s substantiating the fact and value of the property contributed in accordance with statutory and regulatory rules.   Essentially, a contribution valued at $250 or more must be substantiated with an […]

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IRS Releases Form 1023-EZ for Certain Nonprofit Organizations

By on July 23, 2014

The IRS recently issued Form 1023-EZ for use by certain nonprofit organizations applying for tax-exempt status under Section 501(c)(3). With the IRS’ tax-exempt unit under recent political scrutiny, a nonprofit organization filing the regular Form 1023, Application for Tax-Exempt Recognition, can expect to wait for several months or even a year for approval. The goal […]

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Supreme Court Holds Inherited IRAs Not Exempt from Bankruptcy Estate

By on June 20, 2014

The Bankruptcy Code permits an individual in bankruptcy to exempt from the bankrupt estate “retirement funds” in an individual retirement account (“IRA”) or certain other tax-advantaged vehicles. In a recent case, the U.S. Supreme Court considered whether the exemption extends to amounts held in an inherited IRA qualified for the exclusion and unanimously held that […]

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Robert Warwick

FICA Tax Imposed on Compensation That Will Never Be Received

By on June 5, 2014

FICA tax is normally collected through withholding at the time the underlying compensation (“wages”) is received. Under a special rule in the Internal Revenue Code, however (the “special timing rule”), FICA with respect to deferred compensation is collected (generally by withholding from the employee’s non-deferred compensation) at the later of: i) the time the services […]

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Why You Should Keep Stockbroker Receipts

By on May 12, 2014

Gains from the sale of property are generally subject to federal (and, usually, state) income tax (sometimes referred to as “capital gains tax”).  The amount of gain subject to tax is equal to the sale proceeds less the seller’s “tax basis” in the property sold.  In general, the seller’s tax basis is equal to the […]

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Robert Warwick

Supreme Court Holds Severance Payments Subject to FICA Tax

By on April 2, 2014

Compensation for services as an employee (called “wages” in the federal tax code) are subject to FICA (social security and medicare) tax as well as income taxes.  Over the past 70 years, the courts, including the U.S. Supreme Court, have considered the extent to which severance payments made on account of termination of employment are […]

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Robert Warwick

IRS Clarifies Tax Status of Same-Sex Couples after Supreme Court’s Decision

By on August 30, 2013

The Internal Revenue Service has issued a ruling clarifying the federal tax status of same-sex couples after the Supreme Court’s Windsor decision last spring.  In Windsor, the Court held that a decedent’s estate was entitled to the estate tax marital deduction with respect to property left to the decedent’s same-sex spouse where the couple’s marriage […]

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Have you applied for your adoption tax credit yet?

By on March 25, 2013

It’s tax time again, and if you are an adoptive parent, there is a credit out there that you should be aware of – the adoption tax credit.  Generally, you may apply for this credit whether you have adopted a child within the United States or internationally.   The adoption tax credit applies to “qualified adoption […]

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