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Revenue Rulings Questions
Revenue Rulings are public administrative rulings by the
Internal Revenue Service
(IRS) that apply to certain
to particular factual situations. A revenue ruling can be used as precedent by all United States
. Many times the common person may have questions regarding revenue rulings if they do not have
experience. Below are some of the most commonly asked questions about revenue rulings answered by the Experts.
What are the purposes of a balance sheet, and statement of cash flow why would a tax practitioner would not consult the Internal Revenue Code (IRC)?
A cash flow is a type of statement that shows individuals the amount of monies that have been brought into the company; also this statement will show the amount of money that has left the business. Where as a balance sheet shows what tangible and intangible assets a business has, including money that is owed. In some cases laws are not fluid, so a person might have different interpretations of them, and apply them to special facts and circumstances. Cases and rulings can vary district by district and sometimes calls for state definitions or laws to be used. Generally district
apply within the district, appeals court rulings are binding over the districts and Supreme Court is just that; supreme.
Are ordained ministers required to pay Social Security and Medicare tax on contributions made to a TSA (Tax-Sheltered Annuity) under a salary reduction agreement?
In most cases the amount paid into the account in the minister’s behalf by the church would not be included in the minister’s pay, and therefore not subject to self-employment taxes. These links could be helpful in this matter:
If I were to put four names on a Quit Claim deed on a life estate and I am the tenant, if I decide to sell the house do I have to put my name back on the deed and who would have to pay tax on the house once it is sold?
If there was no money exchanged between the four people then when the original owner take their names off of the deed that means they are gifting their ownership interest. If the value of that interest is above $13,000 then each person would be required to file a
return, however there would not be any gift taxes unless the lifetime limit of $5,000,000 is reached. Since the original owner will be the sole owner of the property they will not be responsible for any
; however the original owner would be responsible for income taxes on the capital gain in most cases, unless they owned and used the property at least two out of the last five years before the sale. In this case the part of the gain attributable to the lifetime estate would not be taxable, but the part that is transferred as a gift will be taxable. To determine the percentage of taxable revenue a person would probably need a little help from a Certified Public Accountant (CPA). IRS publication 1457 -
could help in this matter as well.
Is there any legal recourse when someone has been trying to rollover funds from a 401k plan with a former employe however they will not allow access to the funds?
In many plans (including 401k retirement plans), the law requires these plans to pay benefits before retirement under certain circumstances such as termination of the employee. The plan’s Summary Plan Description (SPD) should lay out the plans rules for obtaining the distribution and the timing of the distribution after termination of employment. The person should request a copy of the SPD, if they do not have proof in writing that they are not eligible for the distribution on the SPD form; then they should receive a distribution that they can rollover into an Individual Retirement Account within 60 days.
If a person retires from their job, waits for 61 days from their retirement date, then starts a new job with the same employer does this give their retirement system the right to suspend retirement benefits, claiming that the person did not have a “bona fide separation” from their employer before beginning the new job?
Typically a “bona fide” termination of employment is when the employer/employee relationship is completely severed. Since the Internal Revenue Service (IRS) defines official retirement as “willful termination of employment with no intent to seek a new job after the age of 55,” then it would appear that since this person submitted an application for a new job, whether that person was under the age of 55 or not, prior to retiring they had the intent of working again. Therefore the relationship between the employer/employee was not completely severed. Revenue Rulings are an important part of the
and in most cases can be binding on both the taxpayers and the IRS. There are several types of revenue rulings that can be useful in different situations involving the IRS. To be aware of these can be important in avoiding certain penalties incurred by the IRS on taxpayers all over the nation. Revenue Rulings questions are just one of the many questions that the Experts are ready to answer whenever and wherever they may arise.
Recent Revenue Ruling Questions
As a statutory employee (W-2, box 13 checked), if a full
As a statutory employee (W-2, box 13 checked), if a full time insurance salesperson working for an insurance company drives to the insurance company office, do the daily round trip mileage count as business miles? (cite authority). The statutory employee
taxpayer files schedule C (Form 1040) to claim home office expenses, auto expenses, travel, entertainment, and other expenses. For travel expense, what per diem IRS allowance can be used for lodging, meals, and entertainment?
I was obligated to pay $5000 back to my former employer if
I was obligated to pay $5000 back to my former employer if I left within 24 months. My gross bonus was $8661, the net after taxes to me was $5000 that I received in September 2013. The offer letter I signed indicated that If I left within 24 months, the $5000 would be due in full. No mention of a gross $ amount in the payback portion of the letter. Two attorneys I spoke to agreed that per the letter, my obligation was $5000.
I paid it back to my former employer on January 7, 2015. The W2 I received from them reduced my earnings by $8661 and reduced the tax payments reported by $3661. I don't think they can do that since I only paid them $5000 and I paid it back in a different year.
From what I've read they should have stipulated that if I leave during the same year bonus is paid, repay $5000, if a subsequent year $8661, but they didn't and their letter to me stipulated I needed to pay them $5000 in full. In any event, I asked them for a revised W2 to reduce my earnings by $5000 from last pay stub and leave taxes reported the amounts I paid in. They refuse to revise and contend that this is how it needs to be applied and they will not revise my W2. I am confused.
My position is that I think they should reduce my gross wages by the $5000 I paid them on my W2 and leave the taxes I paid alone so I can receive the credit when I file. The way they did it costs me more tax liability when I paid the amount on my last pay stub into the system; it doesn't smell right. And since I paid them in 2015, I believe they could have left my w2 to match my last pay stub and I take the deduction on my taxes separately.
Grateful for your advice as this is highly stressful for me with tax deadline around the corner with a former employer who is punishing me for leaving them after they highly took advantage of my work ethic and professionalism. I felt that for the amount of value and improvements I made during the 13 months I was there, they should have forgiven this amount given their company size. Now to have this happen is even more upsetting.
I will have to file an extension until I resolve this, but unclear of what/how my w2 should be reported. Once I know that, I will contact the IRS and file W2 Form complaint if necessary.
I must report Canadian dollars in USA-1040. What was the annual
I must report Canadian dollars in USA-1040. What was the annual conversion rate ? I can't find the publication in which I found annual excahnge rates last year.Thanks
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