Category: Tax Planning & Compliance
New Jersey Deductions for Higher Education Expenses and Savings
Beginning in 2022, the New Jersey College Affordability Act allows New Jersey taxpayers tax deductions for certain educational expenses. The deductions are targeted for taxpayers with gross income of $200,000 or less. Deductions are allowed for contributions to the NJBEST college savings plan, in-state higher education tuition costs and NJCLASS…
Failure to Carefully Review Tax Return Results in Costly Mistake for Taxpayers
Whether you prepare your tax return yourself with tax preparation software or rely on an accountant to prepare your return, it is important to remember to meticulously review your returns before filing. The cost of such failure to review could potentially lead to substantial penalties, including a twenty (20%) percent…
Where in the Metaverse is my Cryptocurrency?
Where in the Metaverse is my Cryptocurrency? The internet has been used for many pursuits since its development. A futuristic internet could look something like a “metaverse,” which is a term that describes a futuristic society in which people only live, work, and play in a virtual world. One version…
Expenses Paid with PPP Loan Proceeds Reduce Other Adjustment Accounts, According to Draft Instructions for S-Corporation Returns (Form 1120-S)
Background. The Coronavirus Aid, Relief, and Economic Security (CARES) Act did not specify whether expenses paid using funds received from a Paycheck Protection Program (PPP) loan would be deductible for federal income tax purposes. Congress subsequently passed the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the “Economic…
Split Among Federal Circuit Courts on the Application of the “Non-Willful” FBAR Penalty
Any individual that has direct ownership, signatory authority or beneficial ownership over a foreign bank account that has a balance of $10,000 during any point of the year is required to file a Report of Foreign Bank and Financial Accounts (“FBAR”). The penalties for failing to file an FBAR can…
President Biden Prepares to Sign into Law the Infrastructure Investment and Jobs Act
On November 5, 2021, the House of Representatives passed the Infrastructure Investment and Jobs Act (H.R. 3684) (the “Act”) by a 228-206 vote after the Act was passed in the Senate by a 69-30 vote in August. The Act was presented to President Biden on November 8, 2021, and he…
IRS updates its process for frequently asked questions
The Internal Revenue Service (IRS) recently published a News Release in which it addresses its process for publishing frequently asked questions (FAQs) on tax legislation and taxpayers’ concerns regarding relying on such FAQs. With the enactment of the CARES Act and other coronavirus-related tax legislation providing taxpayer relief during the…
Income Tax Planning with Individual Retirement Accounts
We are occasionally faced with a situation where an IRA is designated to an individual that has predeceased the IRA owner with no contingent designated beneficiary named. In a situation where no designated beneficiary is named, the custodian agreement will control beneficiary designation and many times the IRA ends up…
House Ways and Means Democrats Proposed Tax Changes
Details regarding tax increases needed to fund infrastructure and social safety net changes are beginning to emerge. House Ways and Means Democrats have released text with includes, among many other things, increases in corporate and individual tax rates. Corporate tax rates will increase from 21% to 26.5%. There are actually…
New Jersey Extends Retirement Income Exclusion
The State of New Jersey, recently reduced many retirees’ income taxes by extending a limited pension and retirement income exclusion to taxpayers with gross income exceeding $100,000 but not more than $150,000. New Jersey does not tax Social Security benefits or military pensions. Since 2000, New Jersey has provided taxpayers…