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D was a self-employed accountant. He earned substantial income in the current year, against which he decided to deduct a net operating loss (NOL) carryover from a prior year against his SET. The IRS denied the treatment and imposed the SET on his current-year income from self-employment. Held: For the IRS. An NOL carryforward can reduce current-year [...]
Two main threats are: the proliferation of mobile devices; and failure to upgrade from older, unsupported operating systems. Employee Androids, iPads, iPhones, Blackberries and laptops may not be supported by your IT system. Any sensitive or restricted data that employees download are vulnerable to theft and loss. And, if the devices are not properly disposed [...]
ET, an employer, received an IRS order to garnish a portion of Al’s wages and ET complied. Al sued both the IRS and ET, claiming, among other things, the ET breached its contract with him by not paying full wages earned. Held: For the employer. The code makes employers immune from liability for complying with an IRS [...]
The IRS has two kinds of notices for incorrect business and personal tax returns: The traditional notice of deficiency gives a recipient 90 days to petition for a review before the deficiency is assessed. The math-error notice gives a recipient only 60 days to ask for an abatement or review. Math-error notices should be only for arithmetical or clerical [...]
Y was sole owner and officer of a firm. The business faltered, and he fell behind on the payroll taxes, making partial payments and sometimes full quarterly payments. The IRS assessed him personally for all unpaid taxes plus interest and penalties. Y claimed that the IRS overstated the amount due because it misapplied his payments, [...]
4th Quarter 2011 was the final quarter the IRS will process monthly 941M returns. Starting with 1st Quarter 2012, all employers must file quarterly 941s. Formerly, the monthly returns often were required of employers who fell behind on their employment tax deposits and reached agreement with the IRS. [sBSE-05-1211-09] A note from Your Bookkeeper: 941′s [...]
W, a partner in a CPA firm, decided to incorporate as an S corp with W as sole-owner-employee. W then made his corporation the partner in the CPA firm so that it received the CPA firm’s profit distributions. The S corp paid W a salary of $2,000/month and another $175,000/year that W characterized as “profit [...]
When does pay for travel time affect overtime pay? Travel time that is part of work activity – i.e., travel from one job site to another- is work time included in the base pay used to compute overtime pay. For overnights away, include as work time the employee’s regularly scheduled work hours at his or [...]
D and her husband were equal owners and sole corporate officers of a business. After they separated, they continued to run the business. The firm failed to pay most of its employment tax withholding. After she and her husband settled, the IRS assessed D for the unpaid amounts personally as a responsible person. D said [...]
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