This article was especially interesting to me since I have an art gallery space in my accounting office. Of course, none of the works that I have exhibited fall into the category they are talking about, but imagine if you could avoid capital gains taxes all together through re-investment of your earnings from prior art sales. It’s the same principle as real estate purchases and has been growing in popularity recently, to the point where some “traders” are seeing art as a commodity. What do you think? Time to invest in some fine art?
Category: Federal Income Tax
Time For A “Tax” Break
We are now three days post April 15th, and so I figured we all needed a break from the more serious, tax-related articles. These photographs fascinated me. The grouping entitled Alien Forest is actually of microscopic, forest dwellers who hunt and feed on other microscopic forest dwellers. Hmm, kind of sounds like a microscopic version of the business world. Happy “tax free” weekend. Enjoy the photos by Valeriya Zvereva!
Hidden Alien Forest
Governmental Step Child?
What do you feel when I say IRS? They rank about like Biblical tax collectors in most circles and after their scandalous conference spending along with $2.8 million in bonuses to tax-delinquent employees, it stands to reason. But another spending cut for the IRS may worsen the already growing issues in the areas of enforcement and customer-service functions that have occurred since the last reduction in funds. I mean, who enjoys listening to hold music for an hour just to find out how to properly complete section T-1 on Tax Form IDK WUM 44EZ?
Analysis: Spending bill’s IRS cuts could harm tax enforcement
IRS reveals start date for 2014 tax filing season
The IRS has finally announced an official start date for the 2014 filing season: It will start accepting returns on Jan. 31. This date is 10 days later than the originally planned starting date of Jan. 21. “The late January opening gives us enough time to get things right with our programming, testing, and systems validation,” said Acting IRS Commissioner Danny Werfel in a press release. This process involves programming, testing, and deploying the more than 50 IRS systems that are needed to handle nearly 150 million tax returns.
Read more: Journal of Accountancy
Taxable Scholarships
Tax-Free Scholarships and Fellowships
- A scholarship or fellowship is tax free (excludable from gross income) only if you are a candidate for a degree at an eligible educational institution.
- A scholarship or fellowship is tax free only to the extent:
- It does not exceed your expenses;
- It is not designated or earmarked for other purposes (such as room and board), and does not require (by its terms) that it cannot be used for qualified education expenses; and
- It does not represent payment for teaching, research, or other services required as a condition for receiving the scholarship.
Taxable Scholarships and Fellowships
If and to the extent your scholarship or fellowship does not meet the requirements described earlier, it is taxable and must be included in gross income. You can use Worksheet 1–1, Taxable Scholarship and Fellowship Income (pg 6) to figure the tax-free and taxable parts of your scholarship or fellowship.
Get out of jail free card
Well, not jail exactly.
Many employers prefer to classify employees as contractors to avoid paying payroll taxes and employee benefits. If the IRS , state employment agency, or the Department of Labor (DOL) audits a taxpayer and determines that employees have been miss classified as contractors, the employer may have to pay the employees’ shares of taxes, including estimated income tax, plus the employer share of payroll taxes, interest, and penalties. In addition there is a special six year statute of limitations rather than the normal three year limit as to how far back the IRS can asses additional tax.
The IRS Voluntary Classification Settlement Program (VCSP) as described in Announcement 2012-45 offers employers the opportunity to reclassify their contractors as employees and limit exposure to additions to tax, penalties and interest. Announcement 2012-46 temporarily expands the VCSP through June 30, 2013, to employers that failed to file Forms 1099 for their contractors.
Here’s a good article about the VCSP: Get Your Worker Reclassification Relief While It Lasts
Who’s preparing your tax return?
H&R Block Loses Lawsuit Trying to Stop Intuit TV Ads
A federal court has denied H&R Block’s effort to stop Intuit from continuing to air a pair of TV commercials for TurboTax that comically suggested tax prep franchise employees worked as plumbers and clothing store clerks outside of tax season.
http://www.accountingtoday.com/news/HR-Block-Loses-Lawsuit-Trying-Stop-Intuit-TV-Ads-65495-1.html
New Info on Your W-2
As workers open their W-2 forms this month, many will see a new box with information on the total cost of employer-sponsored health insurance coverage. To some, it will be a surprise, perhaps even a shock.
Continue reading Robert Pear’s article.
Late filing due to forms update by IRS
Here’s the list of forms that the IRS is updating that will delay the processing of your return this year. Note the new “like” and “share” buttons.
Don’t forget your credit union
Credit unions have stepped up their lending. In Austin and across the country, many of these cooperatives have posted record lending growth in recent years and are pushing for the ability to do more. Meanwhile, forthcoming crowdfunding rules could open up a new, multibillion-dollar pipeline between small businesses and the investing public at large.
Read more at Statesman.com