Getting mail from the Internal Revenue Service (IRS) is enough to give anyone heart palpitations. If this letter is sent to inform the recipient of a potential audit, those heart palpitations can turn serious.
Those who hold foreign financial accounts may not understand the tax implications. In some cases, the presence of the account must be disclosed by filing certain forms. Depending on the amount, anyone holding a foreign account may need to file a Report of Foreign Bank and Financial Accounts (FBAR). This document is required by the Treasure Department's Financial Crimes Enforcement Network (FinCEN).
The Internal Revenue Service (IRS) is holding foreign financial account holders responsible for not reporting their accounts. Those who need to report accounts are encouraged to do so proactively. A failure to properly report can lead to both civil and criminal prosecution.
For tax year 2015, the Internal Revenue Service announced today annual inflation adjustments for more than 40 tax provisions, including the tax rate schedules, and other tax changes. Revenue Procedure 2014-61 provides details about these annual adjustments. The tax items for tax year 2015 of greatest interest to most taxpayers include the following dollar amounts -
New 1023-EZ Form Makes Applying for 501(c)(3) Tax-Exempt Status Easier; Most Charities Qualify WASHINGTON -- The Internal Revenue Service today introduced a new, shorter application form to help small charities apply for 501(c)(3) tax-exempt status more easily.
The New York State budget passed on April 1, 2014 includes dramatic changes to the state estate and gift tax laws. Since 2001, the federal estate tax exemption amount (the amount of assets that can be passed to heirs without incurring any estate tax), has risen from $1,000,000 to $5,340,000 while New York State's exemption remained at $1,000,000 per person. Governor Cuomo's 2014-15 budget bill has raised the New York State estate tax exemption amount to $2,062,500 per person immediately with increases over the next 5 years so that the state estate tax exemption amount will mirror the federal exemption, complete with cost of living adjustments, as follows:
The Internal Revenue Service announced today that it is aware that "virtual currency" may be used to pay for goods or services, or held for investment. Virtual currency is a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value. In some environments, it operates like "real" currency -- i.e., the coin and paper money of the United States or of any other country that is designated as legal tender, circulates, and is customarily used and accepted as a medium of exchange in the country of issuance -- but it does not have legal tender status in any jurisdiction.
The Internal Revenue Service today announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2014. Some pension limitations such as those governing 401(k) plans and IRAs will remain unchanged because the increase in the Consumer Price Index did not meet the statutory thresholds for their adjustment. However, other pension plan limitations will increase for 2014. Highlights include the following:
The Internal Revenue Service recently reminded U.S. citizens and resident aliens, including those with dual citizenship who have lived or worked abroad during all or part of 2012, that they may have a U.S. tax liability and a filing requirement in 2013.The filing deadline is Monday, June 17, 2013, for U.S. citizens and resident aliens living overseas, or serving in the military outside the U.S. on the regular due date of their tax return. Eligible taxpayers get two additional days because the normal June 15 extended due date falls on Saturday this year. To use this automatic two-month extension, taxpayers must attach a statement to their return explaining which of these two situations applies.
The tax administrations from the United States, Australia and the United Kingdom announced on May 9th a plan to share tax information involving a multitude of trusts and companies holding assets on behalf of residents in jurisdictions throughout the world.