On March 11, 2014, I was online at CNN’s homepage and came across a link to an article called “Can’t pay Your Taxes? Don’t Panic: Here’s What You Need to Know.” I assume that the article was targeting income tax filers in contemplation of the current filing season, and it was correct enough as a simple explanation. But, as often happens when a complex… CONTINUE
Rev. Proc. 2013-34 Good News for Innocent Spouse Claims
Back on January 5, 2012, the IRS issued Notice 2012-8, which was a proposed Revenue Procedure that would expand and liberalize the IRS procedures for evaluating Innocent Spouse claims. On September 16 ,2013, after a period of taking comments on the proposed new procedures, the IRS issued them in final form as Rev. Proc. 2013-34. Rev. Proc. 2013-34 is effective… CONTINUE
New Year’s Eve Court of Appeals Decision Roils Washington’s Nexus Waters
Washington law provides that for this State to assert B & O tax jurisdiction over an out of state business that makes wholesales into this State two things must occur: (1) the seller must have nexus with this State, and (2) the goods must be received by the buyer in this state. WAC 458-20-193(7). That there… CONTINUE
Confusion and Expense for Small Businesses Dealing with Washington Cities’ B & O Taxes
Some 40 Washington cities impose a business and occupation (B & O) tax on businesses. Some cities also impose flat business license fees and/or fees based on the number of employees, type of business, square footage, or some combination. The Association of Washington Cities states that as of October 2007 approximately 188 cities required a… CONTINUE
City of Seattle’s Year-End Repeal of a Confusing Piece of Legislation
In an article I posted on Nov. 13, 2013 (“The Continuing Debate over Defining Taxable Income”) I discussed the 2011 case of Getty Images (Seattle), Inc. v. City of Seattle, where a Washington Court of Appeals agreed with the City of Seattle that amounts received by Getty were taxable income and not non taxable loans. The… CONTINUE
Unsure if You Have to Collect Washington’s Sales Tax on Your Service Activities? – You May not be Alone.
Businesses that provide services generally know whether or not they are required to collect sales tax. But sometimes there are cases where the law is unclear whether or not sales tax must be collected. Often, in fact, the Department of Revenue may treat taxpayers within the same industry differently, ruling in some cases that a business must collect… CONTINUE
Court Rejects City of Seattle Overreaching
Many businesses are surprised not only that the City of Seattle has a tax on business receipts to begin with, but that the City of Seattle attempts to extend its taxing authority so far. This article looks at one case in which the courts drew a line – a case involving the well know… CONTINUE
The Continuing Debate Over Defining Taxable Income – Getty Images (Seattle), Inc. v. City of Seattle and Klein Honda v. State of Washington
In 1960, the US Supreme Court ruled that when Mr. Berman gave his friend, Mr. Duberstein, a Cadillac to thank him for some business referrals, Mr. Duberstein (who thought he had received a gift and did not report it as income) had to include the car in income as taxable compensation. The Supreme Court said… CONTINUE
The Shutdown and IRS Statutes of Limitations
The IRS reopened October 17, 2013, after 16 days of closure due to the lapse in appropriations that began Oct. 1. During the shutdown, all IRS audits and examinations were suspended, as was all nonautomated collection activity, but the government stated that IRS criminal law enforcement and undercover operations were not suspended. The shutdown did… CONTINUE
2012 IRS Offer Rules Not a Big Deal Unless You Have No Assets
We are getting questions as to how much help clients with substantial assets will actually get from the new offer in compromise rules the IRS announced on May 21, 2012. Here is a short answer which well sums it up. The new IRS offer in compromise rules will lower the cost of an offer for almost… CONTINUE