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Showing posts from May, 2014

IRS Announces Penalty Relief Pilot Program

The IRS announced last week that it will be offering a pilot program to allow small businesses with retirement plans to catch up on filing reporting documents without facing a penalty. The program allows plan administrators who did not file annual Form 5500 series returns to file those returns for current and prior years, and avoid the heavy penalties that could be assessed for the late returns.The program is scheduled to start in June 2014 and run for one year.More information is available in Revenue Procedure 2014-32.

This blog is for informational purposes only and should not be relied upon as legal advice.


Note on Taxing of Nonprofits

In a case recently upheld by the Fifth Circuit, the Tax Court found that amounts deposited into a “pastoral account” were not deductible as charitable contributions.  The Court focused on the pastors’ (a husband and wife) control over the funds in the account, noting that personal expenses were paid out of the account, and social security payments for the husband were directly deposited into the account.  The case (Gunkle v. Commissioner) involved the use of a “corporation sole” in what appeared to be an attempt to avoid certain taxes.  However, in the end, the taxpayers were assessed tax on the personal expenses paid out of the account, along with a 20% accuracy related penalty.  
This blog is for informational purposes only and should not be relied upon as legal advice.

Property Tax Time of Year

Texas doesn’t have a state income tax, but we do have property taxes.The state may mandate the tax, but it is the county that is in charge of assessing and collecting it.In many counties proposed assessments from the appraisal district are mailed to taxpayers around this time of year.If you disagree with the proposed assessment, ensure that you meet the deadline in your county to file a protest.And if you own a business, your county will also have a deadline for filing a rendition.Failure to meet this deadline could result in a penalty on top of the tax on business personal property.

This blog is for informational purposes only.It is not intended to be and should not be relied upon as legal advice.

Death and Taxes

“What is the tax going to be on my inheritance?” I get this question a lot in my probate practice.What many beneficiaries don’t realize is that inherited funds are generally not considered income and will not need to be claimed as income on personal tax returns. (There are some very limited exceptions that have to deal with the form the inherited funds take.)In talking with my probate clients, it seems that most of them have heard of the estate tax, and are concerned about that.Texas does not have a state estate tax.The current federal estate tax exclusion amount is over $5 million, which means if the total value of all the assets of the deceased is less than $5 million, no federal estate tax is due either.  Even some estates over the $5 million mark can avoid the estate tax with some careful estate planning.  Each case is different, and any concerns should be discussed with an attorney individually.
This post is for informational purposes only.  It is not intended to be and should not…