Executive's Tax & Management Report articles from June 2002

Executive's Tax & Management Report archives from June 2002

What you need to know before a payroll tax audit.
June 7, 2002... The proper classification of workers continues to be a serious bone of contention between the IRS and employers. For example, in a recent case, the IRS claimed that a company that provides management services to hospitals had wrongly classified...

Taxpayers cannot "live apart" under the same roof.(Brief Article)
June 7, 2002... In several tax code provisions, couples who "live apart" are treated like unmarried taxpayers. For example, unmarried taxpayers owe no income tax on Social Security benefits unless their income exceeds $25,000. But married couples filing...

Minimize your tax bill when you inherit an IRA. (Retirement Planning).(Brief Article)
June 7, 2002... Let's say Aunt Millie or Cousin Dave dies, leaving you as beneficiary of an IRA or company retirement plan account. What should you do with the funds? Obviously, taxes are a factor (although certainly not the only factor) you will want to...

ABC's of payouts from inherited IRAs. (Retirement Planning).(Brief Article)
June 7, 2002... When an IRA owner dies, the assets of the IRA are included in the owner's taxable estate, and the IRA is turned over to the heirs or named beneficiary. The IRS says withdrawals of the assets in an inherited IRA can fall into three...

Ruling carries a mixed bag for couples who split up. (Family Tax Angles).(Brief Article)
June 7, 2002... A new IRS ruling on employee stock options is "good news, bad news" for couples who split up. The good news: If you own stock options and you transfer them to your ex-spouse as part of a divorce settlement, the IRS says you owe no tax on...

Is the tax code biased? (Business Taxes).(small business taxation report)(Brief Article)
June 7, 2002... Small business owners may be getting the short end of the stick as far as taxes are concerned. That's the thrust of a new report released by the Prosperity Institute. The authors of the report, Dan R. Mastromarco and David R. Burton, conclude...

IRS clarifies amendment notice requirements. (Retirement Planning).(Brief Article)
June 7, 2002... Under a 2001 tax law change, you must notify employees if a change to their pension plan will significantly reduce the rate of future benefit accruals or reduce an early retirement benefit or retirement-type subsidy [IRC Sec. 4980F]. The notice...

Small biz unaware of incentives for retirement plans. (Retirement Planning).(small business tax policy changes)(Brief Article)
June 7, 2002... Tax legislation enacted last year provides more incentives for small businesses to sponsor a retirement plan for their workers. But most small businesses aren't familiar with the law's new provisions, according to a recent survey. The 2002...

Health care costs: more help on the way? (Compensation & Benefits).(tax policies and benefits programs information)(Brief Article)
June 7, 2002... To help Americans cope with the rising health care and health insurance costs, the Bush administration has put forward several measures, including tax-favored health accounts, refundable health tax credits, and help with long-term care. ...

College savings plans make the grade. (Personal Taxes).(529 savings plans details)(Brief Article)
June 7, 2002... The popularity of college savings plans, or "529 plans" (named after the tax code section that created them in 1996), skyrocketed after tax laws enacted in 2001 made withdrawals tax-free when the proceeds are used for college education...

Qualified expenses. (Personal Taxes).(tax policy details)(Brief Article)
June 7, 2002... Money in a 529 plan may be used to pay qualified higher education expenses," which include tuition, fees, books, supplies, and equipment required for enrollment or attendance at a college or university (or certain vocational schools) [IRC Sec....

Tax question. (Personal Taxes).(tax management techniques)(Brief Article)
June 7, 2002... Q Our company provides cars that our sales reps use during the workday for business purposes. The sales reps also use the cars for commuting to and from work. Is their use of the vehicles for commuting considered taxable income? A Yes, the...

Beware of new identity theft scheme. (Personal Taxes).(Brief Article)
June 7, 2002... Taxpayers in seven states have fallen victim to a new scam that uses fictitious bank correspondence and IRS forms in an attempt to trick taxpayers into disclosing their personal and banking data. The information is then used to steal the...

Tough rule may limit expense account deductions.(tax code)(Brief Article)
June 21, 2002... When it comes to taxes, it's not so much what you do but how you do it. For example, take a recent Tax Court case involving a trucking company. Like many employers, the trucking company paid its employees a flat allowance for their meals and...

Which state imposes the heaviest taxes?(Connecticut)(Brief Article)(Statistical Data Included)
June 21, 2002... According to a new report by the Census Bureau, every man, woman, and child in the United States pays an average of $1,967 annually in taxes to his or her state governments--around 6.7 percent of his or her income. The biggest tax hit comes...

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June 21, 2002... We know how important it is for you to get timely updates on tax developments. That's why we're happy to offer our e-mail update service--TaxFlash--as part of your subscription to Executive's Tax & Management Report. TaxFlash delivers alerts...

Loss write-offs sometimes OK on home sales. (Your Home As A Tax Shelter).(Brief Article)
June 21, 2002... The first $250,000 of profit from the sale of your home ($500,000 if you file jointly) is generally exempt from tax. But what's the tax story if you sell your home at a loss? Is the loss deductible? Typically, taxpayers get no loss...

Figuring your loss deduction.(on sale of dwelling also used as rental)(Brief Article)
June 21, 2002... Let's say you rent out your old home for a couple of years and then you sell it at a loss. How do you figure your loss? Your loss is generally the difference between your selling price and your adjusted basis for the property. Your adjusted...

Employee equipment allowances are taxable wages. (Payroll Taxes).(Brief Article)
June 21, 2002... The IRS recently made official what it had hinted at in earlier pronouncements: Most payments to employees for providing their own equipment and tools are taxable wages. The IRS ruled that the payments generally do not meet the tax law's tough...

Is your business eligible for a refund? (Business Expenses).(Brief Article)
June 21, 2002... The Job Creation and Worker Assistance Act of 2002 enacted earlier this year provided relief for businesses that have been struggling in the recent economic downturn. The tax law extended what's known as the net operating loss (NOL) carryback...

Tax question.(question and answer about providing IRS with requested information)(Brief Article)
June 21, 2002... Q My company received a notice from the IRS requesting more information about an exempt payment we claimed on Form 940, Employer's Annual Federal Unemployment Tax Return. Are we obligated to provide the information? A The answer depends on...

More relief for taxpayers affected by terrorist attacks. (Dealing With The IRS).(Brief Article)
June 21, 2002... The Victims of Terrorism Tax Relief Act, which was enacted earlier this year, provides special tax relief for victims of the September 11 terrorist attacks, the 1995 Oklahoma City bombings, and the bioterrorism involving anthrax between...

Federal Tax Calendar: July--December 2002.
June 21, 2002... Federal Tax Calendar: July--December 2002 Key Dates for Paying Taxes and Filing Returns Date Tax Action Wednesday, July 3 FICA and withheld income tax. Semiweekly depositors...