Archive for Tax Policy

California State Tax Filing Season Is Officially Open – Part III

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part III.

Filing Information

Free Do-it-Yourself Services – FTB encourages taxpayers and practitioners to explore its many self-service applications available through FTB’s website:

• CalFile makes filing easier – CalFile is one of FTB’s free, easy-to-use e-file options available to more than 6.4 million taxpayers. CalFile accepts taxpayers with income of up to $345,235, itemized deductions, and some tax credits. Read More

Written by | Posted in Individual • North America • Tax Policy

California State Tax Filing Season Is Officially Open – Part II

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part II.

2013 Short Sellers Get State Tax Relief – According to an IRS Information Letter dated September 19, 2013, the IRS has determined that California taxpayers who sell their principal residences where the lender agrees to a short sale for less than what is owed on the home are relieved of incurring cancellation of indebtedness income, which may have been taxable. Instead, the amount of cancelled debt is included in the amount realized in determining gain on the sale of that residence. Read More

Written by | Posted in Individual • North America • Tax Policy

California State Tax Filing Season Is Officially Open – Part I

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part I.

What’s New for Individuals

Standard deduction – The standard deduction for single or filing separately tax statuses increased to $3,906. For joint, surviving spouse, or head of household filers, it increased to $7,812.

Exemption credit increases – The dependent exemption credit increased to $326 per Read More

Written by | Posted in Individual • North America • Tax Policy

Irish Tax Treatment of Contracts For Difference (CFD)

Recently I’ve received a number of queries relating to the Irish tax treatment of CFDs or Contracts for Difference. Although the information available is plentiful and appears to be straight forward, it’s important to be aware that each situation is different and as a result the tax treatment may vary considerably.

Firstly, what is a Contract for Difference?

Essentially it’s a contract between two parties i.e. the investor and the CFD Provider. At the close of the contract, the parties exchange the difference between the opening and closing prices of a specified financial instrument, including individual equities, currencies, commodities, market indices, market sectors, etc. In other words, two parties take opposing positions on the difference between the opening and closing value of a contract i.e. the price Read More

Written by | Posted in Europe, Middle East • Tax Policy

United Kingdom Announces New Tax

United Kingdom Announces New Tax On Equity Compensation To Global Employees

The United Kingdom published a draft legislation recently that the tax treatment of all employment related securities be the same for all globally mobile employees. Accordingly a portion of any equity award paid to such employees should be apportioned to United Kingdom income based on the number of United Kingdom days in such financial year.

This legislation can create additional costs to the internationally mobile employee and should be reviewed carefully.

Read More

Written by | Posted in Europe, Middle East • Tax Policy

Learn The Real Facts: Unresolved US Tax Liabilities, Re-Entry To USA, Renewal Or Revocation of Your US Passport

There is a lot of misinformation on the internet nowadays on this topic. While overseas Americans must be careful not to fall prey to, what I consider, unscrupulous advisors that liberally employ certain scare tactics, neither must such Americans be complacent with their tax situation. It is clear that the Internal Revenue Service and Congress have set their sights on United States persons living and working abroad because the potential for tax evasion is greater with offshore assets and accounts. Here’s the scoop about unresolved tax liabilities and what they can mean for the American living abroad.

Federal Tax Lien

Taxpayers living overseas are often misinformed or often conveniently forget about their US Read More

Written by | Posted in International • North America • Tax Policy

Minnesota 2013 Nonconformity (Part 2)

Part 1 was all about the debt forgiveness, but there are a number of other items where Minnesota does not conform to the federal rules in 2013. Some items are relatively small dollar amounts like the tuition and fees and educator deductions, and a few others are obscure like the qualified advanced mine safety equipment, the depreciation for motor sports entertainment facilities and interest related dividends from a RIC. There are a few others that have broader applicability.

For older taxpayers that donate directly to a charity from their IRA, the federal return allows them to exclude the IRA distribution from income rather than picking up income and then claiming a charitable deduction. Minnesota won’t allow that so you have to add back the income, but then also add the charitable contribution to the Minnesota return. Read More

Written by | Posted in North America • Tax Policy

Minnesota 2013 Nonconformity (Part 1)

Every year there are tax rules that change for federal purposes and sometimes Minnesota adopts those changes; sometimes they don’t. This year there is a longer than usual list of items that Minnesota does not conform to for individual taxpayers. Often these items are small and obscure and don’t have a huge dollar amount attached to them. This year, one item in particular is going to be a rude realization for some Minnesota taxpayers.

On your federal return you can exclude debt forgiveness income related to your personal residence. In the past you could also exclude that on your Minnesota return, but not this year. Minnesota has not adopted the federal provisions that allow taxpayers to exclude principal residence debt forgiveness. Read More

Written by | Posted in North America • Tax Policy

New Office In Home (OIH) Deduction Review Form 8829 & Revenue Procedure 2013-13

According to IRS Revenue Procedure 2013-13 in addition to claiming the traditional office in home (OIH) or home office deduction on Internal Revenue Service Form 8829 there is a new simplified option now you can consider effective January 1, 2013. Basically this new simplified method if selected allows you to claim essentially a “standard deduction” of $5 per square foot up to 300 square feet for the portion of the home that meets the normal OIH limitations. There are some rules and of course advantages and disadvantages of each method so I’ve done some research comparing the traditional method and the new simplified method.

Under the traditional method

You calculate the square footage of the home used for business and maintain records of Read More

Written by | Posted in IRS • Tax Policy

Can the “Sailing Permit” Become the Next FBAR? Bringing Home the Money

What is a “Sailing Permit”?

A Certificate of Compliance, or “Sailing Permit,” is a tax form that a foreign (non-US) individual must file with the IRS to demonstrate that he/she has paid all applicable U.S. taxes before departing the United States. The purpose of the “sailing permit” is to establish whether a departing foreign national owes any tax dollars to the US government before he leaves the country. Foreign executives and professionals working temporarily in the US can potentially be a large source of revenue for the US’ ailing fisc. The envisioned procedure was set to be easily administered. Prior to departure, the foreigner was to report to an IRS office and submit a preliminary tax computation, as well as pay the amounts due. The person Read More

Written by | Posted in FBAR • International • Tax Policy • United States

Are You Missing the Boat? Do You Find Tax Credits Too Complex? We Don’t!

Today, there currently are nearly 3,000 tax credits and incentives programs in the United States, sponsored by federal, state and local governments to drive job creation, employee training, capital investment and new business development. These statutory and negotiated opportunities – including point-of-hire tax credits, to property & sales tax incentives, to utility & infrastructure abatements, to name a few – are available to companies of all sizes, across a broad range of industries.

But a relatively small number of companies, regardless of their size or financial sophistication, are benefiting fully from the tax credit and incentive-related benefits to which they are entitled. Industry estimates suggest that fewer than 25 percent of eligible US businesses participate in Read More

Written by | Posted in Affordable Healthcare Act • Corporate • Federal • Individual • IRS • North America • Tax Policy

Baucus International Tax Overhaul Draft Released

Senate Finance Committee chairman Max Baucus, D-Montana, has released the first in a series of discussion drafts for overhauling the Tax Code, with the first set of proposals focusing on international tax reform.

The proposal details ideas on how to reform international tax rules to spark economic growth, create jobs and make United States businesses more competitive.

Additional tax reform discussion drafts will be released later this week.

Baucus and his counterpart in the House, Rep. Dave Camp, R-Michigan, chairman of the tax-writing House Ways and Means Committee, have committed to drafting comprehensive Read More

Written by | Posted in Tax Policy
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