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Archive for Annette Nellen

Sales Tax Policy Outlook For 2017

Annette Nellen

Sales tax law changes and discussions in 2017 are likely to look a lot like those of 2016, with one possible exception.

The repeating discussions and activities will include:

1) Expanding the sales tax base to include more services and digital goods.

2) Congressional hearings on the Marketplace Fairness Act without enactment of legislation.

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IRS National Taxpayer Advocate Report Released

Annette Nellen

The IRS National Taxpayer Advocate—Nina Olson—is required to issue an annual report to Congress. The 2016 report was released 1/10/17. These reports are always a great read. The report lists the mots “serious issues” in the tax system and makes recommendations for improvement. The 2016 report focuses a lot on the IRS “Future State” project and tax reform.

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Repealing Obamacare – Costs and Issues!

Annette Nellen

The 115th Congress started on January 3 and repeal of Obamacare (the Affordable Care Act) has begun. Here is information from Majority Speaker Paul Ryan including the budget resolution to help with the repeal. He states:

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New Required Preparer Due Diligence: AOTC & Child Tax Credit

Annette Nellen

The addition of these two credits to the required due diligence of paid preparers in preparing a return that claims either or both was made by the PATH Act (P.L. 114-113, 12/18/15). The statutory language added at §6695(g) implied that regulations were needed. The IRS released draft Form 8867 and instructions in summer 2016, but did not release the regulations until 12/5/16. [TD 9799 (12/5/16) and REG 102952-16 (12/5/16)]

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Employer EITC Notice To Employees – New CA Requirement!

Annette Nellen

Several states require employers to notify employees that they may be eligible for the federal (and perhaps also state) Earned Income Tax Credit (EITC). This year, California law was changed to require employers to also notify employees about the California EITC recently added to the law.

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ACA Taxes Generate More Revenue Than AMT

Annette Nellen

In reviewing some IRS stats for 2014 returns, I was surprised to see that two taxes added by the Affordable Care Act (Obamacare), generated more revenue in 2014 than was generated from the individual AMT. Here are the stats:

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Portland, Oregon Enacts New Surtax For High Executive Pay

Annette Nellen

This week, the City Council in Portland, Oregon modified the business license tax for publicly traded companies subject to SEC reporting. Basically, before the change, this tax is 2.2% of adjusted net income (City Code 7.02.500). The new language increasing this for either a 10% or 24% surtax, follows:

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Virtual Currency – Recent Tax Matters And Concerns

Annette Nellen

First – On 11/8/21, the Treasury Inspector General for Tax Administration (TIGTA) released a report (dated 9/21/16) – Rising Use of Virtual Currencies Requires IRS to Take Additional Actions to Ensure Taxpayer Compliance. Per the release:

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New I-9 Form, Employment Eligibility Verification, Required By January 22, 2017

Annette Nellen

There are a lot of tax and related forms! Here is an update about one required by all employers when they hire an employee. Form I-9, Employment Eligibility Verification, has been updated (as of 11/14/16) and the new version must be used by January 22, 2017 (see news release from USCIS). “Among the changes in the new version, Section 1 asks for “other last names used” rather than “other names used,” and streamlines certification for certain foreign nationals.”

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California’s Prop 55 – Poor Tax Policy

California’s tax hike, Prop 55 on the 11/8/16 ballot, passed (62-38). Its story dates back to 2012.

In 2012, a need for revenue led voters to enact two temporary tax increases (Proposition 30). The state sales tax was increased from 7.25% to 7.50% for four years (2013 through 2016). Also, new personal income tax brackets (10.3, 11.3, and 12.3 percent) were added to the existing top rate of 9.3 percent for seven years, starting at income levels greater than $250,000. The income tax rate increase was retroactive back to January 1, 2012.

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Checklist For Tax Practitioners – Look At The IRS Sharing Economy Tax Center

Annette Nellen

In September, the IRS created a Sharing Economy Tax Center with links to tax information to help freelancers and those renting property. This center offers general information primarily to help individuals understand related tax matters. But it’s not enough for practitioners, as it doesn’t cover all possible tax issues (such as state and local ones) or provide links to relevant law provisions.

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Halloween Taxation Tricks And Treats

Annette Nellen

Halloween has become big business in the past several years. USA Today reported that, per the National Retail Federation, folks in the U.S. will spend over $8 billion on Halloween or almost $83 per shopper!

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