The U.S. Department of Transportation recently revised the SIFL rates that are used to value an employee’s personal use of a company aircraft, as required by the Internal Revenue Code Section 61 and the Federal Tax Regulations Section 1.61-21(g). The Department announced that the following rates will apply for the 6-month period January 1, 2017 through June 30, 2017:
As party goers rang in 2017 this past holiday weekend, owners of Bitcoins had additional reason to celebrate as the value of the digital currency soared past $1,000 USD on Monday. The surge in Bitcoin price, up from just $200 USD in January 2015, may provide additional fodder for the IRS, who has its crosshairs set on Bitcoin users who do not properly report their income related to the buying, selling, and/or exchanging of the digital currency.
In its Technology Vision 2016 report, Accenture predicts that 25% of the world’s economy will be digital by 2020. The global consulting firm contends that we are witnessing a major technology revolution, specifically a digital revolution. It’s a revolution of emerging “digital platforms” comprised of cloud services, artificial intelligence, cognitive computing, predictive analytics and intelligent automation.
These platforms transform and replace traditional business processes in areas such as finance & accounting, HR, marketing, procurement, supply chain and more. To quickly leverage these digital solutions, companies increasingly look to outsource traditional in-house functions to third party providers in what are referred to as Business Process Outsouring (BPO) transactions.
The following is Part II of a six-part series of blog postings regarding whether a captive insurance subsidiary or one owned by the owners or affiliates of a company may represent an effective risk management tool that also provides economic benefits. Although there are various types of captive insurance, this posting and the four to follow will focus primarily on single parent/pure captives and how they might provide economic benefits for you or food and agribusiness company. Part I of this series can be found here.
This posting discusses an alternative to ownership of the captive by the holding company itself — how a business’s owners considering implementing captive insurance as an enterprise risk management tool can also use it as an estate planning or family wealth transfer tool.
House and White House negotiators have agreed to two provisions of the Protecting Americans from Tax Hikes Act of 2015, which may provide an incentive for business aircraft owners. Under the act, which is expected to pass Congress and be signed by the President, “bonus deprecation” is extended and the “expensing” provisions of the Internal Revenue Code are made permanent.
On December 4, 2015, President Obama signed legislation authorizing the federal government to revoke, deny, or limit passports for individuals with a “seriously delinquent tax debt.” The law defines “seriously delinquent tax debt” as owing the IRS more than $50,000 in tax, penalties, and interest. The measure, slipped into the enormous–more than 1,300 pages–highway funding bill [Fixing America’s Surface Transportation Act (“Fast Act”)], gives the State Department the authority to revoke, deny or limit passports for anyone the IRS certifies as owing more than $50,000 in tax debt. Taxpayers with current installment agreements with the IRS, whereby they have agreed to pay their tax debt over time, are exempted from the law.
There has been much debate recently about state income tax rates and/or states having no income tax at all. Recently on MSNBC’s Morning Joe, Joe Scarborough said he knows a lot of people who do what they can to avoid spending 180 plus days in his current state of Connecticut in order to avoid paying income tax there (Connecticut is currently considering hiking its state income tax rate). The reality is that while spending 183 days in a no income tax state like Florida can help establish residency there, meeting this threshold does not completely resolve the residency question or eliminate the legal requirement to file tax returns and/or pay income tax in other states. Indeed many states with income taxes are cracking down on “snowbirds” who attempt to claim residency in places like Florida and Nevada (no income tax states), but who also maintain homes in income tax states like Missouri, Ohio, and Michigan.
On April 28, 2015, Governor Jay Nixon signed Missouri House Bill 384 (H.B. 384), which created a Tax Amnesty Program (the Program) in the state of Missouri. See Mo. Rev. Stat. § 32.383. To qualify for the Program, taxpayers with delinquent tax bills must pay the full amount of any taxes owed prior to November 30, 2015. In exchange, the Missouri Department of Revenue (MDOR) will forego collection of any applicable interest, penalties, or other statutory additions to tax. The MDOR is also prohibited from pursuing a criminal case against taxpayers who participate in the Program unless a subsequent investigation shows the taxpayer engaged in fraudulent or criminal conduct while applying for amnesty. The Program applies only to tax liabilities due or due but unpaid on or before December 31, 2014, and extends only to taxpayers who are not currently a party to any criminal investigation. Taxpayers must also maintain compliance with all of the state’s tax laws for eight years after receiving amnesty. Continue Reading Missouri Tax Amnesty Program Begins September 1, 2015
Husch Blackwell was a Premiere Sponsor of the Federal Bar Association’s 39th Annual Tax Law Conference held on Friday, March 6 in Washington, DC. The Conference was attended by more than 400 practitioners, including private practice attorneys, CPAs, in-house counsel, and government attorneys from the Department of Justice Tax Division, the IRS, and the U.S. Department of Treasury. As Co-Chair of the Conference, Mark Milton introduced two of the featured speakers, IRS Chief Counsel, William J. Wilkins, and the Acting Assistant Attorney General for the DOJ Tax Division, Caroline Ciraolo. Lisa Goyer also spoke on a panel discussing Executive Compensation and Employee Benefits. A complete program brochure is here.
A recent New York Times article contained anecdotes of several taxpayers having their bank accounts seized by the IRS even though they had not been convicted of any crimes. The article leaves the reader with the impression that taxpayers are helpless to defend against such action. While the New York Times article accurately conveys how traumatic such seizures can be for those involved—Sgt. Jeff Cortazzo, who was forced to delay his daughter’s college education for a year; and Carole Hinders, whose 40 year old cash-only Mexican restaurant hangs in the balance—it is important to understand that these citizens have certain rights after a seizure occurs. While the IRS can seize assets without a court of law actually finding a taxpayer guilty of a crime, procedural safeguards exist to ensure that a taxpayer is not subjected to an unjust forfeiture by the federal government.