Category: Tax

Tax Law Articles

Innocent Spouse Relief for Ex-Spouse’s Income

Innocent Spouse Relief For Ex-spouse’s Income

Innocent spouse relief can provide a much-needed remedy for divorced or separated taxpayers who filed a joint income tax return.  This relief is commonly granted where the income that gave rise to the tax liability was earned by one spouse.  The recent Mapp v. Commissioner, T.C. Summary Opinion 2008-76, case provides an opportunity to consider these… Continue reading Innocent Spouse Relief for Ex-Spouse’s Income

A Smattering of Tax Measure Legislation

Taxation Of Employee Donated Sick Leave

It is always interesting to review what tax measures the Legislature is or has been considering.  Here are a few of the tax measures that are or were being considered: Lifetime learning accounts.  Amends the Internal Revenue Code to: (1) establish a tax-exempt lifelong learning account for the payment of certain employee higher education and training expenses;… Continue reading A Smattering of Tax Measure Legislation

Is an Insurance Agents Repayment of Advanced Commissions Cancellation of Debt Income?

Is An Insurance Agents Repayment Of Advanced Commissions Cancellation Of Debt Income?

If an insurance company makes loans to its life insurance agents in lieu of wages and the insurance agents use a portion of those funds to repay costs to the insurance company, how is that taxed?  The court addressed this in Harper v. Commissioner, T.C. Summary Opinion 2007-133. Facts & Procedural History Mrs. Harper was in the… Continue reading Is an Insurance Agents Repayment of Advanced Commissions Cancellation of Debt Income?

Truck Driver Not Entitled to Deductions When Records Destroyed

Truck Driver Not Entitled To Deductions When Records Destroyed

In Clark v. Commissioner, T.C. Memo. 2007-172, the U.S. Tax Court held that a truck driver who did not file tax returns was not entitled to deduct expenses where his records were destroyed in a fire. Facts & Procedural History  Mr. Clark was a truck driver. He was employed by Jimmy Harris Trucking, Inc., Vandy… Continue reading Truck Driver Not Entitled to Deductions When Records Destroyed

There is no Place Like Home (or is There?)

There Is No Place Like Home (or Is There?)

Have you ever said something like “I can’t wait to go home?”  If so, you may not know what the term “home” means.  According to the IRS, the term “home” means the taxpayer’s “principal place of business.”  I am guessing that very few (if any) taxpayers consider their place of business their home. Our federal Tax Code… Continue reading There is no Place Like Home (or is There?)

Can One Spouse Cause IRS to Void Other’s Alimony Deduction?

If a divorce decree says that a payment to an ex-spouse, does that mean that it is alimony the ex-spouse has to report as income for Federal income tax purposes?  And if not, can the ex-spouse who receives the payment request a ruling from the IRS to say that the payment was not taxable to… Continue reading Can One Spouse Cause IRS to Void Other’s Alimony Deduction?

Non-Profit No More

Taxation Of Employee Donated Sick Leave

The IRS Can Sometimes Take A Hardline With Taxpayers For example, the IRS often takes a hard line with taxpayers in instances where the taxpayer is a non-profit and it fails to timely file a tax return. In these cases the IRS will has the power to revoke the taxpayer’s non-profit status, but in many… Continue reading Non-Profit No More

Taxation of Employee Donated Sick Leave

Taxation Of Employee Donated Sick Leave

Employees often want to donate paid sick-leave time to deserving co-workers who find themselves in a pinch. The IRS recently released another ruling, Private Letter Ruling 200720017, that identifies a few of the planning considerations in donating sick leave to co-workers. Income Tax on Donations of Sick Leave The federal tax consequences of donating paid… Continue reading Taxation of Employee Donated Sick Leave