Anthony Sykes & Company

        In June, legislation was introduced into Congress known as the Taxpayer Protection and Preparer Proficiency Act . The goal of this bill is to create a minimum Federal standard for all tax preparers. At this point, none exists. However, there are basic standards that must be met under laws in certain states, like in California. There are tens of thousands of complaints received by the Internal Revenue Service ( IRS ) every year that relate to poor service from tax preparers. Fraud can be prosecuted, but nothing can legally be done in the case of incompetence. This new tax law is taking aim at this problem.           This law is an effort to make sure that every taxpayer can be assured that their tax preparer is qualified. The requirements would include showing an ability tax returns and claims for refunds, it would also require continuing education credits. The IRS would also be given the authority to invalid...

         When someone dies, an executor is appointed to identify the assets of the estate, pay its debts, and distribute what is left to the heirs. What some not realize is that the executor is also responsible for arranging to pay any taxes and filing the appropriate tax forms. This is a situation that can become very complicated for several reasons, so here are a few details to help get you through a difficult time.           For an unmarried person , the last Form 1040 should be filed the same as it would normally. It would cover the time from January 1 to the day of their death. There is the possibility of being able to deduct uninsured final medical expenses. If they are married , and the surviving spouse remains single until December 31 of that year, then the last Form 1040 can be filed as a joint return. In this way, they can continue to enjoy more favorable income tax rules. This may even be possible ...

          After over a year and a half since the passage of the Tax Cuts and Jobs Act ( TCJA ), the regulations that apply to many international transactions are still not finalized. There are issues that still need to be addressed as companies are unsure how to proceed. They are making some conservative guesses but are really looking for clarity from the Internal Revenue Service ( IRS ).           For example, there is the Foreign Derived Intangible Income ( FDII ) provision. This is a potential deduction for businesses, but it can only be claimed if the business can prove that what it sells is for foreign use . In this way, a company’s decision on where to locate its headquarters will not be based on how it can avoid paying taxes where most of its goods are sold. Companies are unwilling to alter their normal business operations to prove that they qualify for FDII. The IRS has indicated that there will be more...

         One of the most talked about issues surrounding the Tax Cuts and Jobs Act ( TCJA ) was the deduction limitation of $10,000 when applying State and Local Taxes ( SALT ) to Federal taxes. One immediate idea that certain high tax states proposed, was to create charitable accounts where Taxpayers could give money to states to pay taxes, and yet have them considered as charitable contributions. In this way people could make up for the Tax deductions they lost. Some states loved the idea and started to put it into action, while the Internal Revenue Service ( IRS ) said it would not work. The rules have now been established.           One of the rules being applied should be somewhat familiar. The whole idea behind a truly charitable donation is that a person is giving money or other goods in exchange for nothing . If there is an expectation of something in return, then it is really a payment and no charity i...

        One of the goals of the 2017 Tax Cuts and Jobs Act ( TCJA ) was to keep multinational corporations from hiding profits offshore to avoid paying US taxes. While this Tax Reform has taken great steps toward reaching this goal, unanticipated results have come to be seen. In applying this law, any foreigner who becomes a US citizen must report the global income of any family businesses in the US and pay the tax on the income of those businesses.           The changing of tax rules in this area do not only impact business interests, these can be applied to domestic trusts, partnerships , and estates . This is a sharp increase in tax responsibility that many are unprepared for. This is a real situation that many are dealing with and have very limited options moving forward. With guidance, some can navigate this tricky situation, without having to renounce their claims or move out of the country.