Are you among the thousands with property damage caused by Hurricane Irene? Casualty losses relating to your home, household items and vehicles may be deducted on your Federal income tax return, less the amount reimbursed by insurance. If the property was not completely destroyed, the amount deductable is the lesser of: [Read more…] about Hurricane Irene Damages are Tax Deductable
Valuation of Real Estate in NJ Matrimonial Case
A recent Supreme Court decision in Sachau v. Sachau, 206 N.J. 1 (2011), highlights the impact of silence on key terms involving real estate in property settlement agreements (PSAs). Sachau centers on a PSA that was incorporated into the parties’ final judgment of divorce. The PSA, which was executed in 1979, provided that the marital residence would be held jointly by the parties until it was sold. Moreover, Ms. Sachau and the two children would be entitled to reside there until the youngest child reached 18. At that time, the PSA further stated, the house would be appraised and listed for sale within 30 days. Upon sale of the house, Mr. Sachau would receive $15,000, Mrs. Sachau would receive $10,000, with the remainder split evenly between them. The PSA failed to address, however, the amount to be divided if no action were taken by the parties to sell the house within 30 days. This in fact is exactly how the scenario played itself out. [Read more…] about Valuation of Real Estate in NJ Matrimonial Case
Attorneys Beware:IRS Targeting You!
The IRS recently signaled an increase in scrutiny of attorneys, releasing a comprehensive Attorneys Audit Technique Guide (ATG) for IRS auditors when reviewing attorneys’ returns. The guide pinpoints potential problem areas, as well as procedures, that IRS agents must focus upon when auditing attorney returns. Key areas include: [Read more…] about Attorneys Beware:IRS Targeting You!
Reduce your NJ Unemployment Rates!
All New Jersey employers received this week a Notice of Employer Contribution Rates. It clearly states, “This is not a bill”, but rather a summary of the manner in which the NJ Department of Labor calculates your employer contribution rate for unemployment and disability. Furthermore, this form enables you to determine whether a voluntary contribution would save you, or your clients, money in the subsequent year. A voluntary contribution increases the reserve balance and may reduce your contribution rate. [Read more…] about Reduce your NJ Unemployment Rates!
NJ Office of Taxpayer Advocate Taking Sales & Use Tax Cases
Beginning, Aug. 1, 2011, the Office of the Taxpayer Advocate (OTA) will start considering cases involving sales and use tax. Previously, the OTA had only considered cases that involved gross income tax. To be deemed eligible for OTA assistance, the following conditions must be met:
- You face a threat of immediate adverse action for a disputed liability, or believe that you did not receive adequate notification of the Division’s actions or that the Division’s actions are unwarranted, unfair, or illegal.
- You have experienced a delay of more than 120 days to resolve a tax account problem or in receiving a response to an inquiry to the Division.
- You are experiencing undue hardship or are about to experience undue hardship, which is defined as undue economic harm resulting from the way in which the tax laws, regulations or policies are being administered by the Division of Taxation. Personal or economic inconvenience is not considered undue hardship. [Read more…] about NJ Office of Taxpayer Advocate Taking Sales & Use Tax Cases
Judge Invalidates Tax-Affecting in Estate Business Valuation
Estate of Gallagher V. Commissioner
A recent decision from the U.S. Tax court tackles a myriad of issues pertaining to private company appraisal, most notably the issue of tax-affecting. The case involves the business valuation of a decedent’s minority interest in a privately held newspaper publishing company. The taxpayer’s expert made tax affected adjustments by assuming a 39-percent income tax rate in calculating the company’s future cash flows before discounting the company’s future earnings to their present value. He also assumed a 40 percent marginal tax rate in calculating the applicable discount rate. [Read more…] about Judge Invalidates Tax-Affecting in Estate Business Valuation