By month: January 2012

Does Your Foreign Bank Account Smell Like Offshore Tax Evasion to the IRS?

The IRS does not like offshore and foreign bank accounts that are not reported on the FBAR, IRS Form 8938, and Schedule B of IRS Form 1040. Millions of U.S. taxpayers have perfectly legal and properly reported offshore and foreign bank accounts. But legal or illegal, they must be reported on the two income tax forms and the FBAR.

IRS Arrives at the Audit with Tax Assessor’s Allocation to Land and Building

On your rental properties, you need proof of your cost allocation to land and depreciable buildings. If you have no proof of that allocation, the IRS has started using the Web to grab the tax assessor’s allocation and use that against your depreciation deductions.

Use the Estate Tax Value to Avoid Federal Income Tax on Home

Keeping your home until death has advantages. At death, your estate avoids both capital gains and recapture taxes, and passes the home to your heirs at a stepped-up fair market value basis. This combination triggers a good number of income tax planning strategies.

Professional Corporation as a C Corporation Is a Personal Service Corporation

If you incorporate your personal service business, you face the personal service corporation tax rates, where tax brackets do not exist and the 35 percent flat-tax rate applies.

Tax Deductions for Shotgun and Partying at Charity Skeet Shoot

Tax law contains a strange rule that doubles the business tax deduction for a charitable skeet shoot over the deduction allowed for business entertainment. In fact, the charitable-skeet-shoot rule produces a business tax deduction greater than what you could deduct as a charitable deduction.

New IRS Ruling Improves Tax Deductions for Business Travel to Panama

Panama is now part of the tax-defined North American area where tax deductions are favored by tax law. For entry into this favored tax-deductible area, Panama had to agree to give the IRS and other government agencies banking and other information that otherwise was not available under Panama’s bank secrecy laws.

Tax Deductions for Dues and Expenses of Being a Mason or a Lion

Tax law favors and allows deductions for civic and public service clubs and even names some favored clubs. But tax law does not allow dues deductions for airline, hotel, country, golf, athletic, and business-meal clubs.


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