Updated IRS Guidance on FBARs to be filed June 30th
The updated guidance is important for individuals holding interests in mutual funds through bank or brokerage accounts. On a recent webinar hosted by the Internal Revenue Service (“IRS”; “the Service”), Service representatives stated that mutual funds held in brokerage accounts generally do not have to be separately reported. Instead, taxpayers report foreign brokerage accounts in which the mutual funds are held. The physical location of the account determines whether it is foreign — not whether the bank itself is U.S.-based or foreign-based. For instance, an account at a branch of a foreign bank located in the U.S. is not a. Read More.
House Republicans Lead Contempt Charge Against Lerner
With a 231-187 vote, the U.S. House of Representatives held former Internal Revenue Service (“IRS”) official Lois Lerner in contempt of Congress. Backed mostly by Republican officials, the contempt charge was due to Lerner exercising the Fifth Amendment to prevent self-incrimination during the investigation over the IRS’ targeting of conservative-based groups. Republicans, however, believe Lerner waived her right once she claimed innocence while appearing in front of the House Oversight Committee last year. Before the vote took place, Rep. Richard Nugent (R-FL) stated, “Mrs. Lerner made 17 separate factual assertions before invoking her right to remain silent. You can’t make. Read More.
The Impact of the Supreme Court’s Decision on Manufacturing and Distribution
After years of lower court decisions unfavorable to the Internal Revenue Service (“IRS”), the U.S. Supreme Court (“the Court”) ultimately sided with the IRS regarding severance pay considered as wages. As a result of the Court’s ruling, severance pay is now considered wages and subject to FICA tax. Let’s explore the impact of this decision and tax planning strategies for employers. Background of the Decision Previously, severance pay was not considered as wages. Thus, severance pay was not subject to FICA withholding. Now, due to the United States vs. Quality Stores ruling, both the employee and employer must pay FICA,. Read More.