Every year the IRS lists out the most aggressive scams of the year under its “Dirty Dozen” list. This list highlights various phishing and other scams that taxpayers might encounter. The current IRS list includes the following scams: Phishing: At the top fo the list is Phishing – fake e-mails/websites that try to steal personal […]
Taxable Events in the Virtual World
In October 2019, the IRS issued a new Revenue Ruling – 2019-24 which deals with virtual currencies/cryptocurrencies and provides much needed guidance on the treatment of specific taxable events associated with cryptocurrencies. The virtual world is similar to a web (which is where the “world wide web” derived its name from) or akin to a […]
Virtual Currency – The Real Story
We have all heard of Bitcoin and Ethereum – Cryptocurrencies that are also considered to be virtual currencies. So, what exactly is virtual currency? According to FinCEN – (Financial Crimes Enforcement Network), virtual currency is a “medium of exchange that operates like a currency in some environments, but does not have all the attributes of […]
What is the FATCA Compliance Act?
The IRS has over the last few years strengthened implementation of reporting requirements for foreign financial assets held by US citizens/residents. While the FBAR (Foreign Bank Account Reporting) rule has been in force since 1972, FATCA (Foreign Account Tax Compliance Act) was enacted in 2010 to enforce United States Persons living in the US and […]
Tips to check if your gift is taxable
If you gave money or property to someone as a gift, you may owe federal gift tax, which means your gift is taxable. Many gifts are not subject to the gift tax, but the IRS offers the following eight tips about gifts and the gift tax. Most gifts are not subject to the gift […]
How to know if an IRS audit is round the corner?
With ever-improving improved detection systems and computerized checks, the IRS can more easily identify red flags that trigger the IRS audit. Contact typically starts with a letter requesting more information and can lead to in-person meetings. It is usually triggered by a tax return that contains something unusual, such as an above-average deduction or […]
Tax Deduction Myths!
The tax laws listed out in full glory on the taxpedias might at most times seem too overwhelming for us to understand and interpret. So, there is bound to be a lot of confusion on what tax deduction to claim on your income tax return. A few commonly misinterpreted/misrepresented deductions are listed below for your […]
How would you qualify for home office deduction?
If you use part of your home for business, you may be able to deduct expenses for the business use of your home. The IRS has the following six requirements to help you determine if you qualify for the home office deduction. 1. Generally, in order to claim a business deduction for your home, you […]
Reporting Capital Gains and Losses on Schedule D and Form 8949
The IRS has unveiled a new tax form for reporting capital gains and losses from stocks, bonds, mutual funds, and similar investments. Starting with the 2011 tax year, investment transactions will be reported on the new Form 8949, Sales and Other Dispositions of Capital Assets. A draft version of Form 8949 is posted at […]
IRS tips for employers outsourcing payroll
Outsourcing payroll duties to third-party service providers can streamline business operations, but the IRS reminds employers that they are ultimately responsible for paying federal tax liabilities. Recent prosecutions of individuals and companies who – acting under the guise of a payroll service provider – have stolen funds intended for payment of employment taxes makes it […]