Updates to the Tax Code News

Recent News about Updates to the Tax Code

Internal Revenue Service shows improvement in compliant pension plans -- The Internal Revenue Service is continuing to tweak its procedures and how it handles the tax code while it continues to battle the war on income taxes and those who attempt to defraud the federal government.
Japanese couple operating California restaurant get second chance on tax charges -- A case that started with a false statement of income taxes has turned into a significant court ruling that affects immigrants everywhere.
IRS re-examining innocent spouse rule after woman wins her case -- The "innocent spouse" rule implemented by the Internal Revenue Service is supposed to benefit in-the-dark spouses from being liable for their partner's taxes, but one woman found out things aren't always as they appear.
New York passes legislation to crack down on state income tax evasion -- A loophole in New York tax law has been sealed shut with new legislation that aims to eliminate white collar crime and those who attempt to evade filing returns on their income taxes, according to a Reuters report.
Big business proposal: reduce income taxes on overseas profits -- Overseas profits brought in by U.S. businesses could see a 29.75 percent reduction in federal income taxes owed if a number of influential corporations and lobbyists get their way, according to a New York Times article.
Same-sex couples must conduct income splitting on taxes -- While Congress recently approved a number of tax breaks, one is open only to same-sex couples and requires them to report their combined income on their federal income tax returns.
Recession puts increased burden on state and local governments -- Due to lingering effects of the recent recession, many state and local governments have had difficulty raising revenue from their residents.
IRS to add more law enforcement officials -- After resolving to step up efforts against tax evaders to help fight the federal deficit, the Obama administration announced plans to increase the number of employees at the IRS for 2012.
Self-employed seniors eligible for new tax break -- Due to the reversal of a long-standing tax rule, self-employed elderly taxpayers are getting an unexpected tax break this year.
Obama budget would add 5,100 IRS employees -- This week, President Barack Obama submitted his version of the fiscal budget to Congress for consideration. In the document, the White House is asking for big increases to the IRS budget.
Nursing mothers can qualify for new tax breaks -- The IRS announced this week it is reversing its earlier stance on breast pumps and breastfeeding supplies. As a result, nursing mothers will now be able to write off these purchases as medical expenses.
IRS facing steep budget cuts under GOP proposal -- Under a new spending plan released this week by congressional Republicans, U.S. scientific research, high-speed rail and the IRS would all face steep budget cuts in the coming year.
Homeowner tax credits could increase refunds for some taxpayers -- Due to recent Congressional legislative changes, homeowners who recently made energy-efficient updates to their properties could capitalize on a number of available tax credits.
IRS gives out millions in erroneous hybrid vehicle credits -- More than 12,000 taxpayers successfully claimed $33 million in fraudulent tax credits for plug-in electric and alternative-fueled vehicles, according to a recent government report.
Senate votes to retract transaction reporting to IRS -- Members of the U.S. Senate voted this week to eradicate an amendment of the recent healthcare bill that would have expanded tax reporting requirements for businesses.
Choosing the right tax preparer can help avoid business audits -- Prior to the April 18 deadline, many small business owners will begin preparing their income tax returns and may be wondering how they can avoid mistakes that can cause an audit.
IRS announces processing start date for itemized returns -- The IRS plans to start processing tax returns that were delayed by recent congressional decisions on February 14, the agency announced this week.
Wisconsin city unveils tax policy changes -- The city of Sheboygan, Wisconsin, is set to begin collecting property taxes from residents later this year; however, those who use a debit or credit card to make these payments could be hit with an additional fee.
IRS to research small businesses -- The IRS announced this week it will conduct more research into the tax needs and preferences of small businesses and self-employed workers.
Massachusetts may issue tax credit for video game developers -- In a move that could potentially bring new jobs and revenue to the state, Massachusetts announced this week it will issue tax credits and other incentives to attract video game developers.
Earned income tax credit rules change -- Due to recent legislative attempts by congress, the IRS is planning a number of changes to its rules for the Earned Income Tax credit for 2011.
Obama administration calls for greater IRS disclosure -- This week, the Obama administration called on U.S. banks to disclose IRS bank accounts that are owned by foreigners.
Average tax refund worth more than $3,000 -- The average taxpayer received $3,003 dollars on their income tax returns in 2009, a 5 percent increase from 2008's figures.
Massachusetts offers tax breaks for booming film business -- Nearly a quarter of the tax breaks that were given out under Massachusetts' film tax credit program have gone to fund payments to Hollywood movie stars.
Medical residents must now pay taxes to IRS -- The U.S. Supreme Court approved a measure this week that forces medical residents to pay Social Security taxes to the federal government.
Consumer advocate says IRS should stop filing liens -- A government watchdog agency says the recent increases in the number of tax liens filed by the IRS as a result of the recession is tormenting many struggling taxpayers.
Popular tax software company says IRS change would delay revenue -- Intuit Inc., the developer of popular income tax software such as TurboTax, said its annual profits are likely to be delayed until later in the year due to recent IRS changes.
Tax day will be moved to April 18 -- This year, Americans will be receiving three extra days to file their taxes, as the IRS announced it will move the final date from April 15 to the 18.
IRS wants faster settlements for small businesses -- The IRS announced one of its first initiatives for the new year on Thursday, outlining plans to provide a new program for small businesses and self-employed taxpayers facing financial issues with the agency.
IRS changes rules on fixing release contingents -- The government's principal tax collection agency modified its correction program for nonqualified deferred compensation plans earlier this week, in one of the many changes expected for next year's tax season.
New IRS rules to impact online retail market -- Starting next year, the many American businesses and individuals who make their living selling products on third party web sites will be facing increased scrutiny.
Home energy tax credit gets reduced -- As a result of the recent extension of the Bush-era tax cuts, consumers now have more time to cash in on the government's home energy upgrade tax credit.
IRS increases reporting requirements for brokerages -- Starting next year, investors will have to report what they paid for shares of stock to the IRS due to new regulations.
IRS issues new tax tables for 2011 -- The IRS issued its income tax withholding tables for 2011 on Friday, one day after Congress voted to leave tax rates unchanged.
Moody's says it won't downgrade U.S. credit rating due to tax cuts -- The recent extension of Bush-era tax cuts has caused an uproar on Capitol Hill, as lawmakers worry about its effects on the nation's budget deficit.
IRS announces cuts to standard mileage rates -- In their latest announcement for the 2011 tax season, IRS officials outlined their new standard mileage rates for taxpayers.
IRS provides guidance for small business tax credit -- The IRS released finalized guidelines for small businesses looking to become eligible for a business healthcare tax credit for the 2010 tax year.
IRS provides details about electronic filing requirements -- Starting on January 1, 2011, paid tax preparers must comply with a new law that requires registration for all tax preparers
Tax law repeal fails in senate -- U.S. senators failed to pass two measures which would have repealed tax form requirements for American businesses.
IRS commissioner breaks silence about potential tax changes -- In the halls of Congress, the biggest debates this season are those regarding potential changes to tax collection protocols, as many exemptions are set to expire by the year's end.
IRS announces new members for advisory committee -- The IRS announced its selection of 7 new members and a chairman for its Electronic Tax Administration Advisory Committee this week.
Landlords, renters face new IRS reporting rules -- Beginning on the first of the new year, record keeping for property renters and landlords is set to face increased scrutiny by IRS officials.
IRS extends benefits for long-term care insurance -- With the future of Social Security benefits currently being debated in the halls of Congress, many seniors remain uncertain about the long-run safety of their medical benefits.
Tax officials may change drug payment regulations -- Consumers who use tax-free health spending accounts to pay for over-the-counter allergy medicines and other remedies may soon need a prescription to obtain the drugs.
IRS blocks missing child data -- Parents of missing children are calling on the IRS to change its privacy laws regarding federal income tax returns.
IRS requires new steps for tax preparers -- A new IRS regulation is slated to go into effect this year, potentially affecting the 60 percent of Americans who get professional help on tax returns.
IRS to require new registrations -- The IRS made an important announcement on Wednesday, signaling a change in the way income taxes will be filed with the government.
Supreme Court weighs tax-break for religious private schools -- Arizona tax breaks for donations benefiting private school scholarships are currently being debated before the Supreme Court.
Supreme Court reluctant to repeal tax breaks for medical residents -- Members of the Supreme Court are currently weighing a decision to overturn an IRS tax for medical residents.
Congress to fight minimum tax -- In a letter to the IRS, Congress said it plans to fight the alternative minimum tax, which would force an estimated 21 million households to pay $66 billion in extra taxes this year.
Scientists receive IRS help in the form of tax breaks -- The IRS announced the recipients of a new batch of cash grants for scientific research this week.
IRS may ramp up IRA tax enforcement -- Individual Retirement Arrangements hold trillions of consumer dollars that under tax law are sheltered from IRS collection.
IRS posts announcements for next year's tax season -- The IRS has posted some key changes that can help Americans prepare for the 2011 tax season
IRS to examine Build America Bond compliance -- The IRS announced this week it plans to review Build America Bonds issued in 2009 and 2010 in order to ensure their compliance with federal tax law.
IRS rules against breast-feeding tax break -- Nursing mothers will not be able to use their new government healthcare accounts to pay for breast pumps or baby bottles due to a new IRS ruling.
IRS affected by new writing act -- President Barack Obama signed the Plain Writing Act into law on Wednesday, October 14.
IRS creates tax break for luxury homeowners -- The IRS issued a public ruling which allows homeowners to deduct interest on their income taxes for the first $1.1 million of a new home mortgage.
City of San Antonio faces IRS scrutiny -- The IRS is auditing $275 million worth of Build America Bonds issued by the city of San Antonio, Texas, and $600 million from a Chicago sewer district.
Obama pushes tax credit extension -- President Barack Obama has urged Congress to renew the American Opportunity Tax Credit, which was set to expire at the year's end.
IRS delays new health care reporting -- The IRS outlined plans this week to delay the implementation of a tax law requirement that emerged as a result of President Barack Obama's new health-care law.
Non-profits risk losing tax excempt status -- Charitable groups across the country face losing their tax-exempt statuses due to a little known mandate in federal tax law if they fail to comply by week's end.
IRS urged to specify details on the duties of cybersecurity employees -- A new report released by the Treasury Inspector General for Tax Administration found the Internal Revenue Service had failed to record the responsibilities of all employees working on cybersecurity. TIGTA, J. Russell George, now says the IRS must clarify these duties, which include protecting the tax information of individuals across the country.
IRS announces decision to stop mailing hard copies -- Beginning next tax season, individuals who prefer to file their returns with hard copies will have to find them somewhere other than their mailboxes. The Internal Revenue Service announced this week that it will no longer mail traditional paper forms for filing as a result of the growing popularity of eFiling.
Baucus pushes IRS to launch investigation into nonprofits -- On Wednesday, Senator Max Baucus (D-Montana) asked the Internal Revenue Service to investigate the tax exempt statuses of nonprofit organizations across the country. The senator, who is also the chairman of the Senate Finance Committee, wants the IRS to look into groups that are abusing their tax-exempt statuses for political gain.
IRS to take business complaints into consideration -- Internal Revenue Service Commissioner Doug Shulman has announced the IRS will be taking business complaints into consideration as they begin to disclose uncertain tax positions over the course of the next five years. In the process, the IRS will scale back how much information is revealed on large corporations taking tax breaks that may not be warranted by the government.
Democrats postpone decision on Bush tax cuts -- Congress had the opportunity to make a decision on the 2001 Bush tax cuts a priority when they returned from their summer recess, but it will have to wait until the mid-term elections. Senate Democrats have postponed the vote on whether to keep the cuts in tact until after the Republicans unveiled their "Pledge to America" last week.
Texas nonprofits in danger of losing tax exempt statuses -- As the Internal Revenue Service deadline for tax exemptions draws closer, more than 30 Texas nonprofits are at risk of losing their tax exempt status. The government agency's website displays a list of the organizations in danger if they do not file the proper forms by October 15.
Native Americans may finally see update to restrictive tax code -- The Treasury Department and Internal Revenue Service announced this week that they are considering either removing or improving the restrictive tax code on tribes across the country. The provisions, which previously restricted tribes' participation in a number of federal tax incentive programs, may be repealed.
Several nonprofits still at risk of losing tax exempt status -- Despite creating an extension for nonprofits that failed to file specific forms, the Internal Revenue Service says it is worried many may still not meet the elongated deadline. As many as 1,200 nonprofit organizations in North Dakota alone may lose their tax exempt statuses, including 4-H clubs and cemetery associations.
Soft notices may become a standard IRS procedure -- This week, Treasury Inspector General for Tax Administration J. Russell George sent a letter to the Internal Revenue Service, encouraging them to make "soft notices" a permanent part of its automated program.
New provision for landlords expected to fill tax gap -- The Small Business Jobs Act passed by the Senate last week could mean more tax paperwork for rental property owners if it is signed into law by President Barack Obama, experts say. The bill gives $30 billion in funding and tax breaks to companies that choose to invest in small businesses. It also includes a new provision that will require landlords to submit a Form 1099 to any unincorporated service providers they pay $600 or more to in a year.
Homebuyer tax credits overwhelm IRS -- A Treasury Department audit has recently discovered that the Internal Revenue Service is still finding difficulty handling the high volume of homebuyer tax credits. The Treasury Inspector General for Tax Administration completed the audit on August 16. The results revealed that some taxpayers who qualified for the credits did not get any, while others who did not meet the requirements received them.
IRS disagrees with proposal to freeze refund process -- A report released by the Treasury Inspector General for Tax Administration this week said the Internal Revenue Service had disagreed with the government's recommendation to freeze taxpayer refunds. By putting them on hold, the government believes the IRS will have more time to validate the submitted claims.
Pelosi has power to extend cuts for middle class -- The number of Democrats who believe the Bush tax cuts should be extended is growing, but new reports this week found that House Speaker Nancy Pelosi may be able to at least guarantee cuts for the middle class.
Alterations to Bush tax cuts may harm small businesses -- President Barack Obama has yet to make a decision on the 2001 Bush tax cuts, set to expire at the end of this year. However, Democrats have expressed their desire to extend the cuts for the middle class and let them expire for those making $250,000 or more a year.
New bill passes, provides more funding for small businesses -- After a 61 to 38 vote, lawmakers have passed a bill to give $12 billion in tax breaks to companies that choose to invest in small businesses. The bill will also create a $30 billion fund for small businesses across the country.
Families advised to prepare for expiration of Bush tax cuts -- The 2001 Bush tax cuts gave breaks to the wealthy, but they are set to expire at the end of the year. The Democrats have yet to make a decision on extending the cuts, but President Barack Obama has expressed he would like to keep them in tact for households making $250,000 or less a year.
Small business tax credit may help nearly 450,000 -- This week, the Internal Revenue Service released a form to help small businesses claim tax credits that went into effect earlier this year. The document, titled Form 8941, will help companies and nonprofit organizations calculate the exact amount of money they are eligible to receive under the credit.
New survey shows Americans support altering Bush tax cuts -- In August, 66 percent of Americans who responded to a Wall Street Journal/NBC survey said they would support increasing taxes for the rich. Although President Barack Obama has yet to make a final decision on whether he will extend the 2001 Bush cuts, more Americans are voicing their support in favor of collecting additional revenue from the wealthy.
White House confident in decision to let cuts expire for the wealthy -- The 2001 Bush tax cuts, which originally provided breaks for the wealthy, are set to expire at the end of the year. As Republicans continue to push for an extension, the White House now says it is confident it has the votes to extend the cuts for the low-to-middle class without providing them to the upper tier of the tax bracket.
IRS plays watchdog as a result of Citizens United plan -- Earlier this year, the Supreme Court approved the Citizens United plan to lift the limit on donations toward special groups and organizations. Inadvertently, however, they have tossed the Internal Revenue Service into the mix by giving it a more prominent duty of donation overseer.
Farmers also will suffer if tax cuts expire -- The Democratic Party has been under heat in the past month as it moves closer toward making a decision on the Bush tax cuts set to expire in 2011. Those at the top of the tax bracket are skeptical that the cuts will be extended for their class, but farmers are the latest to voice their discontent with the looming expiration.
Allowing Bush tax cuts to expire may steer investors away from small businesses -- There has been an ample amount of speculation as to what the Democrats are going to do with the Bush tax cuts set to expire for the wealthy. Republicans have been the most vocal about the possibility of them ending, claiming that allowing this to happen would hurt small businesses. While their opinion is not the majority, it’s gaining steam as market analysts wonder whether it will affect investments in the long term.
Proposed California law may reveal councilmen salaries to the public -- A proposed California law would raise the income tax to 50 percent for cities that overpay their councilmen. If it passes it will entail penalties for cities designated by the attorney general and require open-session votes on top officials' compensation.
Tax experts back bill proposed to ease California deficit -- The California Democrats debuted a plan this week to resolve the state’s $19 billion deficit. The proposal is aimed at resolving the state’s $19 billion deficit. The proposal suggests increasing personal income tax for the middle class while cutting other taxes to relieve debt. Experts have told a Senate committee that it would be a good move.
Congress to limit tax deductions for health insurance executives -- The new healthcare legislation has given Congress leeway to limit tax deductions for medical insurance company executives across the country. The goal is to prevent corporate officers from benefiting from expanded enrollments.
Geithner speaks out against GOP claims that Dems aim to hurt small businesses -- Treasury Secretary Timothy Geithner is the latest to speak out against the Republican Party, which accused the Democrats of trying to hurt small businesses by potentially letting the Bush tax cuts expire at the end of 2010. Last week, several GOP representatives claimed that if the Democrats make the decision to only extend cuts for the lower to middle classes, the growth of the economy could be hindered by the damage done to these businesses.
California pushes IRS to make tax regulations equal for same-sex couples as they are for heterosexual couples -- The California Legislature passed a resolution this week asking that same-sex couples be taxed the same as heterosexual couples. The resolution, AJR29, requests that the Internal Revenue Service rule that individuals in same-sex partnerships each report half of their income on federal tax returns.
IRS chooses to withhold data, hurts business for H&R Block -- This past week, the Internal Revenue Service announced a new rule that will affect consumer tax assistance businesses across the country. The government-operated service has said it will no longer provide companies with the information to underwrite loans to tax filers expecting a refund.
Obie Trice, Young Buck the latest rappers to be pursued by the IRS -- Wyclef Jean is perhaps the biggest rapper to make headlines for failing to file taxes amidst his presidential run in Haiti, but he is not the only one being pursued by the Internal Revenue Service. Rappers Swizz Beats, Obie Trice and Young Buck all owe substantial amounts in back taxes.
Rapper Wyclef Jean owes more than $5 million in tax liens on properties in three states -- An investigation team is reporting that rapper Wyclef Jean has $5,278,430 worth of tax liens against properties in New Jersey, New York and Florida. Jean recently made news when he announced that he will likely run for the presidency of Haiti.
IRS announces decision to shift focus to tax evasion -- The Internal Revenue Service announced this week that it is going to shift its focus to tax evasion. The government organization plans to overhaul a unit responsible for coming down hard on large corporations and wealthy individuals.
Georgia mortgage broker sentenced to nine months in jail for tax evasion after IRS investigation -- A 46-year-old mortgage broker from Duluth, Georgia, has been sentenced to nine months in prison for tax evasion. U.S. Attorney Sally Quillian Yates said that Keith Kim pleaded guilty to failing to pay $242,000 in income taxes in April. The investigation was led by special agents of the Internal Revenue Service.
Rap industry leader Damon Dash loses properties to foreclosure after failing to pay mortgage, taxes to the state -- This week, hip-hop mogul Damon Dash was forced to give up two condominiums New York City after tax liens on the property forced him into foreclosure. Dash did not make the $78,504 monthly payments on his $7.3 million mortgage.
Virginia massage therapist faces jail time for tax evasion and fraud -- According to the Daily Times in Virginia, a woman from Bethany Beach has been convicted of 12 counts of tax evasion and fraud. Anne Marie Connor, 60, hid her earnings in "sham" trusts between 2000 and 2006. Connor is the owner of a Bethany health food store and also generates income as a massage therapist.
Securities and Exchange Commission files complaint against billionaires Sam and Charles Wyly -- The New York Times is reporting that the Securities and Exchange Commission has filed a civil complaint against billionaire brothers Sam and Charles Wyly. Both are notable for donating millions of dollars to the Republican party, universities, animal shelters and the arts.

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Updates to the Tax Code News

Recent News about Updates to the Tax Code