Hughes Noff Tax Law, LLC

11/29/2024

https://hntaxlaw.com/2024/11/17/welcome-to-hughes-noff-tax-law-llc/

We are delighted to introduce Hughes Noff Tax Law, LLC—a firm born from a shared vision to provide exceptional tax law services tailored to the unique needs

05/24/2023

If you've spotted errors in your tax return, you're not alone. Each year, millions of people find themselves needing to file amended returns.

There was a recent article in the WSJ with excellent information and advice regarding amended returns.

While many simple, innocuous errors can be easily corrected with an amended return, there are certain situations that call for a more cautious approach and professional advice.

One key point the article made was that filing an amended return to claim a refund could unintentionally set off an audit of your entire tax return. So, if there are other issues hidden within the original return, they need to be thoroughly evaluated before moving forward.

Moreover, if there are potential criminal tax issues lurking beneath the surface, the decision to amend a return becomes significantly more complicated. In these instances, it's crucial to consult with a lawyer who specializes in criminal tax-law issues. You might even need to consider a voluntary disclosure instead of an amended return.

And remember, the IRS is currently grappling with substantial return-processing backlogs. This means your amended return might not be processed for quite some time, possibly a year or more.

For one thing, expect more delays than in the past if you’re seeking a refund.

08/25/2021

The IRS Director of Collections recently issued a memorandum that provides guidelines to Collections personnel regarding the use of FATCA data in IRS collection cases. The memo requires the use of FATCA data in certain cases such as high-income non-filer cases with sufficient unreported income. In other cases, the use of FATCA data is discretionary.

Taxpayers should expect that material discrepancies (or omissions) between information provided on collection information statements (I.e., Form 433) and FACTA data will be investigated and potentially cause for a referral IRS Criminal Investigation.

On August 16, 2021, the IRS Director of Collection Policy issued a memorandum to provide guidance when FATCA[1] information should be used in IRS Collections cases. See SBSE-05-0821-0015 (the “Memo”) (available at the IRS website here: link). The new guidance from the Memo will be added to the I...

02/11/2021

Taxpayers that paper filed their 2019 return after July 2020, may receive a "CP59 - You didn’t file a Form 1040 tax return" from the IRS because the IRS is still processing returns for 2019. Notice CP59s are sent out automatically after 4 months after the extended due date. There is some indication that there are a large number of taxpayers that received the notice in error despite the fact that the IRS is sitting on the taxpayers' returns. If you received CP59 and you filed your return, then you should still call the IRS to confirm receipt (despite what the IRS advised Russ in the article below).

Currently, it's also not uncommon for the IRS to cash your payment but fail to apply the payment to your account. This may cause IRS computers to kick out erroneous balance due notices too. Calling the IRS or pulling transcripts from the IRS website is a good idea.

If you need to paper file or mail in a payment to the IRS, then you should definitely keep a copy of the mailing and USE AN OPTION THAT HAS TRACKING.

This is a good post discussing the erroneous CP59s and the IRS tax return processing issues:

http://www.taxabletalk.com/2021/02/10/more-erroneous-irs-notices/

04/10/2020

The new Economic Impact Payments (i.e., stimulus checks) are going to be distributed by the IRS in a few different ways.

A new tool just went live (Friday April 10) to help speed the process up for some individuals.

If you have filed a 2018 or 2019 return and you have an authorized direct deposit account, then the stimulus funds are to be deposited directly into your account.

Social security recipients are supposed to receive the stimulus payment automatically too.

However, if the IRS does not have current banking information on file, then taxpayers will have to wait for a paper check, which could take weeks.

Next week the IRS is also supposed to roll out a new web portal to help taxpayers track their stimulus payment and update out of date payment information to avoid having to wait for a paper check in the mail.

However, non-filers should look into taking action now (i.e., individuals that do not have a filing obligation because they earn less than the standard deduction).

Free File, in coordination with the IRS, created a new tool for non-filers and that are not going to get the stimulus payment automatically through social security payment information. (https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here)

This new post on Forbes helps explain the new tool for non-filers.

https://www.forbes.com/sites/kellyphillipserb/2020/04/10/irs-finally-launches-registration-tool-for-stimulus-checks/

Taxpayers who don’t usually file a tax return now have a new tool to get stimulus checks through the Treasury Department and the Internal Revenue Service (IRS).

02/06/2019

Currently, IRS Revenue Officers can be aggressive, but this not like in this story from the 70's. I had never heard this story before. Shocking.

The IRS changed its policies because of the uproar that followed a 1979 incident when a woman was dragged out of her old VW Beetle in Fairbanks.

01/24/2019

This isn't good news for anyone. Hopefully Congress funds the IRS before the 2019 tax season becomes a complete disaster.

Union officials say financial hardship and a coordinated protest could lead to a surge of IRS employees missing work as the government shutdown continues.

01/23/2019

Last week the IRS issued final regulations related to the new Section 199A deduction. Sec. 199A allows taxpayers to deduction up to 20% of qualified business income (QBI) from a domestic business operated as a sole proprietorship or through a partnership, S corporation, trust, or estate. The Sec. 199A deduction can be taken by individuals and by some estates and trusts

Of note, the final regulations, in conjunction with IRS Notice 2019-7, provide a safe harbor for when a “rental real estate enterprise” would be treated as a trade or business for purposes of Sec. 199A.

"Under the proposed safe harbor, a “rental real estate enterprise” would be treated as a trade or business for purposes of Sec. 199A if at least 250 hours of services are performed each tax year with respect to the enterprise. The IRS says this includes services performed by owners, employees, and independent contractors and time spent on maintenance, repairs, rent collection, payment of expenses, provision of services to tenants, and efforts to rent the property. However, hours spent in the owner’s capacity as an investor, such as arranging financing, procuring property, reviewing financial statements or reports on operations, and traveling to and from the real estate will not be considered hours of service with respect to the enterprise."

However, the safe harbor has a catch: you must maintain contemporaneous records, including time reports, logs, or similar documents to prove that the enterprise meets the 250 hours test. A similar requirement for the real estate professional test trips up a lot of taxpayers because it is time consuming to keep a contemporaneous log. It's not clear how a taxpayer could support time for a contractors such as property managers. It will be interesting to see how the new regulations and the safe harbor will be applied in practice.

The package includes final regulations, guidance on how to calculate W-2 wages, a safe-harbor rule for rental real estate businesses, and new proposed rules on the treatment of previously suspended losses.

01/23/2019

Good list of tips to start off 2019.

CPA financial planners share their favorite moves for kicking off the year right.

01/21/2019

Tax brackets have been in the news lately and they tend to cause some confusion. This is a good summary on how they work.

There is a common misunderstanding about how tax brackets work in the US, and it’s causing us to have uninformed debates about taxes. Become a member of the ...

01/19/2019

The Shop Maryland Energy weekend is coming up again in mid-February (16th-18th). There is no Maryland sales tax on certain energy efficient appliances.

Consumers will get a break from the state's 6 percent sales tax on qualifying Energy Star products from February 16-18, 2019. During Shop Maryland Energy weekend, the following Energy Star products are tax free: