Sec. 7345 does not violate constitutional right to travel
Fifth Amendment: Rowen argued that Sec. 7345 is unconstitutional on its face because it prohibits international travel, which he claimed is a fundamental right granted by the Fifth Amendment to the Constitution. The court rejected this idea, finding that the "plain test" of Sec. 7345 does not impose a prohibition on international travel.
Actived: 7 days ago
Tax time travel: Securing relief from unforced errors
(9 days ago) Tax time travel is possible. Mistakes happen, but life — and the tax law — sometimes afford the opportunity to reset the clock, undo the error, and avoid the costs and consequences of having made it. Securing relief under the procedures discussed …
Travel Sites Held to Owe Millions in Transaction Taxes to
(9 days ago) Online travel companies could be forced to pay millions in uncollected taxes, penalties, and interest under recent state court rulings in Georgia and California, with other jurisdictions to possibly follow.
IRS Updates Rules for Substantiating Travel Expenses
(7 days ago) On September 27, 2007, the Service issued Rev. Proc. 2007-63, which updates the rules for substantiating an employee’s travel expenses using reimbursement arrangements, per diem allowances, or the high-low method.
2014–2015 Per Diem Rates for Business-Related Travel
(4 days ago) The updated rates are effective for per diem allowances paid to any employee on or after Oct. 1, 2014, for travel away from home on or after that date, and supersede the rates in Notice 2013-65, which provided the rates for Oct. 1, 2013, through Sept. 30, 2014.
Substantiating Expenses: All or Nothing
(4 days ago) Sec. 274(d)(1) for travel expenses (including meals and lodging while away from home); Sec. 274(d)(2) for any item with respect to an activity that is of a type generally considered to constitute entertainment, amusement, or recreation, or with respect to a facility used in connection with such an activity;
IRS Illustrates Employee Reimbursement Plans
(6 days ago) It compensates the nurses on an hourly basis the same amount regardless of whether the nurses have to travel away from home to work at a hospital. However, when the nurses are required to work away from home, Employer B treats a portion of the nurses’ hourly compensation as a nontaxable per diem.
A pragmatic approach to sourcing sales of services
(3 days ago) Contributors. Bridget McCann is a senior manager with Grant Thornton LLP’s State and Local Tax practice in Iselin, N.J., focusing on income and franchise tax. Jennifer Jensen is a director with PwC in Washington in State and Local Tax, focusing on indirect taxes. Ms. Jensen is chair and Ms. McCann is a member of the AICPA State & Local Tax Technical Resource Panel.
High-Low Method for Substantiating Travel Expenses
(7 days ago) The IRS has annually issued an updated per diem rate for travel to any specified “high-cost locality” or other locality within the continental United States. Under the high-low substantiation method, the high or low rate, as appropriate, applied as if it were the federal per diem rate for the locality of travel.
Tax Court: Sports team allowed 100% meal deduction when
(5 days ago) If the time required to travel to a road game is greater than 150 minutes by flight, the CBA requires that the team arrive the day before the game. During the tax years at issue, 2009 and 2010, the team personnel traveling with the Bruins to road games included players, the head coach, assistant coaches, medical personnel, athletic trainers
Bonus Depreciation Denied for Asset Used but Not
(6 days ago) For example, a travel delay that caused him to miss a meeting with a potential client cost him an $8 million commission. Over time, he went from flying commercially to chartering jets. Ultimately, he acquired his own jet in 2001.
Individual Income Taxation
(2 days ago) IRS updates business travel per-diem rates . The allowances for determining deductions for lodging, meals, and incidental costs are slightly higher than before. AICPA recommends QBI improvements. The AICPA recommended in a letter to Senate tax-writing leaders eight ways to improve the deduction for qualified business income under Sec. 199A.
Texas Comptroller Provides Rules on the Texas Franchise Tax
(2 days ago) Examples include an employee’s use of a company car for business, job-related education provided to an employee, and travel reimbursement (34 TX Admin. Code §3.589(e)(2)(D)). Practice tip: A tax planner should also determine if there are employees or workers provided to the taxable entity via a management contract, staff leasing company, or
Tax Treatment of Expenses Incurred by Individuals
(8 days ago) Deductible travel expenses, including meals and lodging, must meet the substantiation requirements in Sec. 274(d). Conclusion. As explained earlier, individuals may be able to deduct business expenses despite being unemployed or out of work.
Final regulations on the meals and entertainment deduction
(3 days ago) Travel meals The amendments to Regs. Sec. 1.274-12 also incorporate the substantiation requirements in Sec. 274(d) to travel meals, whereby no deduction is allowed for the expense of any food or beverage paid or incurred while traveling away from home in pursuit of a trade or business unless the taxpayer meets those substantiation requirements.
Coping with the new entertainment expense and
(7 days ago) IRS Publication 463, Travel, Entertainment, Gift, and Car Expenses, which has not been modified since enactment of the legislation, makes the distinction between entertainment and nonentertainment meals meaningful and provides insight into how the IRS views meals: A meal as a form of entertainment.
The receipt and redemption of rewards program points: Tax
(2 days ago) EXECUTIVE SUMMARY : In a 2002 announcement, the IRS stated that it would not assert that a taxpayer's receipt or personal use of frequent flyer miles or other in-kind promotional benefits attributable to the taxpayer's business or official travel resulted in income to the taxpayer — the only time the IRS has addressed the issue.
IRS Updates Special Per Diem Rates for 2013–2014 Travel
(7 days ago) Two years ago, the IRS provided, in Rev. Proc. 2011-47, the general rules for using a federal per diem rate to substantiate the amount of ordinary and necessary expenses for lodging, meals, and incidental costs paid or incurred for business-related travel away from home. Taxpayers using the rates and the list of localities in Notice 2013-65
Apportionment Using Market-Based Sourcing Rules: A State
(9 days ago) Travel Support Corp’s books and records maintained in the regular course of business indicate that fifteen (15) percent of its customers have billing addresses in this state. However, Travel Support Corp’s books and records indicate that only seven (7) percent of the calls handled by the call center originate from this state.
The Exclusion for Meals and Lodging
(7 days ago) This article explains the general exclusion under Sec. 119(a) and the other limited exclusions for meals and lodging received from an employer and addresses whether a partnership may treat a partner as an employee for purposes of the Sec. 119(a) exclusion.
Final regs. provide guidance on TCJA changes to
(2 days ago) The final regulations also make clear that a deduction will not be allowed for travel meal expenses for a spouse, dependent, or others that accompany the taxpayer or employee of the taxpayer on business travel unless: (1) the person is an employee of the taxpayer; (2) it is for a bona fide business purpose of the taxpayer; and (3) the expenses
Per Diem Travel Rates Updated
(7 days ago) The IRS issued updated federal per diem rates and procedures September 30 (Rev. Proc. 2010-39) for substantiating deductible expenses or employer-paid allowances for lodging, meals, and incidental expenses incurred in business-related travel away from home.The revenue procedure supersedes Rev. Proc. 2009-47, issued September 30, 2009, and is generally effective for amounts …
Deducting startup and expansion costs
(4 days ago) In effect, a new branch was formed, and expenses for travel, moving, training, printing, and telephone were deductible as ordinary and necessary business expenses. Identifying expansion costs. Costs incurred in expanding an existing business are generally deductible under Sec. 162 as ordinary and necessary business expenses.
Oral Surgeon Cannot Deduct Expenses for Traveling Between
(7 days ago) The Tax Court upheld IRS-assessed deficiencies caused by the disallowance of a number of travel expenses an oral surgeon deducted on his Schedules C, Profit or Loss From Business, for 2008 and 2009, and its imposition of a negligence penalty under Sec. 6662(a) (Bigdeli, T.C. Memo. 2013-148).
Business meal deductions after the TCJA
(Just Now) Travel meals: Deductibility of a travel meal gets different, higher scrutiny. 27 Regs. Sec. 1. 274-12 (a)(4) provides special rules for travel meals. This subsection invokes by reference paragraphs (a)(1) and (a)(2) of the regulation, so the three requirements of Regs. Sec. 1. 274 - 12 (a)(1) must be substantiated, just as they must be for
Taxation of Frequent Flyer Miles
(6 days ago) Consistent with prior practice, the IRS will not assert that any taxpayer has understated his federal tax liability by reason of the receipt or personal use of frequent flyer miles or other in-kind promotional benefits attributable to the taxpayer’s business or official travel.
Per Diem Rate Updates for 2012–13
(7 days ago) For purposes of the high-low substantiation method, the per diem rates are $242 for travel to any high-cost locality and $163 for travel to any other locality within the continental United States. The notice also lists high-cost localities that have a federal per diem rate of $202 or more.
Departing aliens and the sailing permit
(2 days ago) The rules of Sec. 6851 (d) were initially codified as Section 250 (g) of the Revenue Act of 1921 and were enacted to thwart departing aliens from leaving the country with outstanding income tax liabilities. The Code section laid the groundwork for what is commonly known as a "sailing permit" or "departure permit."
Meeting the 100-Hour Significant Participation Activity Test
(7 days ago) Effective beginning in 2013, the Health Care and Education Reconciliation Act, P.L. 111-152, created the 3.8% net investment income tax imposed by Sec. 1411 to fund health care reform.Since this tax came into effect, taxpayers and their advisers have considered income tax planning methods to alleviate the additional tax due.
Qualified transportation fringe disallowance
(5 days ago) Under Sec. 274(l), added by the TCJA, a company cannot deduct any expense incurred for providing any transportation, or any payment or reimbursement, to an employee in connection with travel between the employee's residence and place of employment, except where the costs were necessary for ensuring the safety of the employee.
Taking business deduction for RV ends up costing taxpayers
(2 days ago) The Harkinses listed the RV as a piece of property "used 50% or less in a qualified business use" on the Getaway Crew's tax returns in 2016, 2017, and 2018. Mrs. Harkins also testified during her deposition that she operated her travel business from the …
The Tax Consequences of Point-Based Employee Reward Programs
(5 days ago) The incentive merchandise and travel industry has experienced rapid growth in recent years. According to a study released by the Incentive Federation in 2007, the amount spent on incentive merchandise and travel in 2006 was $46.1 billion—almost double the $26.9 billion spent in 2000. 1 The study found that more than one in three U.S. companies used incentive travel or merchandise to
COVID-19 tax news and information
(2 days ago) Interruption of LIFO inventories due to COVID-19 and Sec. 473 relief. Global supply chain problems caused by the COVID-19 pandemic have made it difficult for US companies to replace inventories, potentially subjecting them to additional taxable income. The AICPA has requested relief under Sec. 473. August 11, 2021.
Tax Return Due Diligence: Basic Considerations
(6 days ago) Tax Return Due Diligence: Basic Considerations. By Douglas J. Milford, CPA, J.D., and J. Edward Swails, CPA, J.D. September 30, 2010. EXECUTIVE. SUMMARY. Due diligence, in the context of tax return preparation, is the diligence or care that a reasonable preparer would use under the same circumstances. It is an objective standard.
New Prop. Regs. Clarify Tax Deductible Entertainment Use
(5 days ago) Travel by family members who are not doing business will definitely count as entertainment use, subject to limitations. Prop. Regs. Sec. 1.274-10(e)(2)(iii) clarifies that a detour from a business destination to another city on the way home will result in entertainment use equal to the excess of the total cost of the flight over the cost
Tax Considerations for Ministers
(8 days ago) The minister may not deduct any travel expenses with a significant element of personal pleasure, recreation, or vacation. 81. How does the IRS treat church contributions a minister must make to retain employment in determining available income to pay a delinquent federal income tax liability?
Long-Haul Truck Driver Has No Tax Home
(9 days ago) A long-haul truck driver who spent most of the time on the road and had no other home did not have a tax home that would allow him to deduct his unreimbursed travel expenses because he was not away from home, the Tax Court held (Howard, T.C. Memo. 2015-38).The truck driver, who resided in Missouri, spent 358 days in 2009 on the road.
The physical presence test for excluding foreign earned income
(Just Now) Therefore, a day involving travel in international waters between foreign locations in increments of less than 24 hours is treated as a full day in a foreign country. Sec. 1.911-2(d)(2) and (3), Income Tax Regs" (emphasis added). Here is a breakdown of C's itinerary in Example 2:
Maximizing Individuals’ Deductions for Startup Expenses
(9 days ago) Such costs can include, but are not limited to, advertising; salaries and wages paid to employees being trained and their instructors; travel and other expenses incurred in lining up prospective distributors, suppliers, or customers; and salaries or fees paid or incurred for executives, consultants, and similar professional services (H.R. Rep't
The business meal expense deduction after the TCJA
(7 days ago) However, the bill would have allowed taxpayers to still deduct 50% of the food-and-beverage expenses associated with operating their trade or business (e.g.,meals consumed by employees on work travel), the conference committee report notes. 13 Thus, it appears that under the proposed House statutory language changes, a deduction for business
Proving a Business Connection for Meals and Entertainment
(8 days ago) Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation (Regs. Sec. 1. 274-2 (b)(1)). Meal and entertainment expenses incurred by a taxpayer to entertain a client, customer, employee, or other business associate are deductible only if the expenses satisfy the following strict requirements imposed by the Code: