TaxConnections


 

Archive for John Stancil

Minister’s Housing Allowance Update

John Stancil, Tax Advisor

The minister’s housing allowance has been challenged in court. There have been several challenges in recent years, but last month, Judge Barbara Crabb once again ruled the housing allowance as unconstitutional, favoring a religious group. As of now, it is anticipated that the order will be stayed, meaning it will not be enforced, pending appeals. Once the appeals are exhausted, the order would take effect. Obviously, this would take at least a couple of years.  Read more

NFL Tax Breaks – And Tax Breaks Americans Dream About

John Stancil, Tax Advisor

Much has recently been said of the tax breaks received by the National Football League. While they do receive certain tax breaks, many of these breaks are also available to other businesses. Granted, they do tend to be on a larger scale.

There is however, one area in which sports franchises do get significant tax breaks. Below are three aspects to tax breaks received by the NFL and other professional sports:

  1. Tax-exempt status of the league office
  2. Amortization of the purchase price of the franchise
  3. State and local financing of sports stadiums.

Read more

Minister’s Housing Allowance Loses a Court Battle

John Stancil Tax Advisor

In a 2013 count case in Wisconsin the Freedom From Religion Foundation (FFRF) challenged the Minister’s housing allowance, claiming it provided an unconstitutional subsidy of religion. They won that case, but it was overturned on appeal. The reason for overturning it was that the appeals court indicated that the FFRF did not have standing (or reason to sue) as they had not been damaged by the housing allowance law. The FFRF took it to heart and certain leaders in FFRF paid themselves a housing allowance and excluded it from tax on their individual 1040’s. The IRS disallowed some of them. This led to a new suit, heard by the same Wisconsin judge who made the 2013 ruling. Once again, she ruled the housing allowance unconstitutional.

Read more

President Trump’s 2017 Disaster Tax Relief Bill

John Stancil, Tax Advisor

At long last, Congress and President Trump have given us a tax bill that provides some real relief for taxpayers impacted by this year’s hurricanes. The “Disaster Relief and Airport and Airport Extension Act of 2017” was signed by the President on September 29.

Although it deals with issues beyond hurricane relief, those issues are not the focus of this article and will not be discussed here. And there are some provisions relating to hurricane disaster losses that do not have widespread application and will not be discussed here.

There are four important segments to the hurricane relief granted by this act.

Read more

Employers May Give Employees Tax-Free Disaster Relief

John Stancil

If they carefully follow the guidelines, employers may give cash payments to employees for disaster relief, tax-free. Under Sec. 139 of the Internal Revenue Code, qualified disaster relief payments to employees are tax free to the employee and deductible by the employer. This includes income as well as social security and Medicare taxes. Read more

Inflation-Adjusted Amounts for 2018 Taxes

Certain tax items are adjusted annually for inflation each year. The numbers that follow are not official releases by the IRS, but reflect the probable amounts that will be in effect for tax year 2018, based on the formulas used by the IRS.

The standard deduction for couples filing a joint return is anticipated to increase to $13,000, an increase of $300 from 2017. Single and married filing separately is half that amount. Head of Household will be $9,550, a $200 increase. Taxpayers 65 years or older or blind will get an additional $1,300 standard deduction, a $50 increase. Personal and dependency exemptions will be the same as for 2017, $1,050. These increases will result in an increase in the minimum income requiring taxpayers to file a return.

Read more

Big-Game Hunter Becomes Hunted by IRS

Big-game hunting has fallen into disfavor in recent years, as wealthy hunters take expeditions to Africa and other far-away locations to hunt big game for sport. What we are referring to here is not hunting game for food, it is just for the “thrill of the kill.” I didn’t say “thrill of the chase,” as there is often no chase, as the game is rigged so that the animal is essentially trapped.

One such big game hunter is Paul Gardner. Gardner maintains a “trophy room” in his home, displaying many of his exploits. But after a while, Gardner began running out of space. Some of what he displayed was full body, but much of it was from the neck up, hung on walls. In these cases, there are a lot of “extra” parts that are not on display.

Read more

Tax Effects Of A FEMA Disaster Declaration

If your county has been declared a FEMA disaster area due to the recent hurricanes, you have more time to file your tax returns and make certain tax payments. Individual and business income tax returns that previously received extensions to October 16 and September 15, respectively are now due January 31, 2018. Tax-exempt organizations who received an extension will have their return due date extended likewise.

In addition, any tax payment deadline of September 4 or later has been extended until January 31, 2018. This includes estimated quarterly payments for Third and fourth quarter 2017. Individual tax returns that were originally due April 18, 2017 and received a six-month extension are not eligible for the extended due date, as that payment was actually due in April, 2017.

Read more

Don’t Count On A Hurricane For Tax Extension

The IRS has granted an extension of time to file 2016 income tax returns for individuals and businesses impacted by Hurricane Harvey. The new deadline is January 31, 2018. Eighteen Texas counties are included in this extension – Aransas, Bee, Brazoria, Calhoun, Chambers, Fort Bend, Galveston, Goliad, Harris, Jackson, Kleberg, Liberty, Matagorda, Nueces, Refugio, San Patricio, Victoria, and Wharton. Other counties could be added. In addition, if a taxpayer outside the designated area can demonstrate that records necessary to complete the return are located in the affected area, an extension may be granted.

Read more

The IRS And Private Collectors

John Stancil

After failed attempts in the past, the Internal Revenue Service has engaged the services of four private-sector collection agencies. As most people are aware, there are numerous tax-related scams in today’s world. If you are contacted by someone who states they are attempting to collect a tax debt for the IRS, you need to know what to expect and how to determine if the individual is legitimate. Read more

When Hockey Meets the IRS

The United States Tax Court recently made a ruling that drew some fine lines about what constitutes a de minimis fringe benefit for employees. The IRS had sued the Boston Bruins Hockey Team, contending that meals served to players and others while attending away games was subject to the 50 percent limitation on the cost of meals provided to employees. It should be noted that this is a working-condition benefit and not taxable to the employees. The Bruins countered the IRS, stating that these meals met the qualifications of a de minimis benefit and were therefore fully deductible. The Tax Court sided with the Bruins, stating that the benefit was fully deductible. Read more

You Could be Taxed on that “Non-Taxable” Employee Benefit

A benefit frequently offered to employees is discounts on products or services that the company sells. Under the Internal Revenue Code, all benefits provided to an employee are taxable, unless they are specifically excluded from income or defers tax on the benefit.

One example of deferring tax on the benefit would be employer contributions to a pension plan for the employee. This is not subject to income tax at the time received, but is taxed then the employee begins making withdrawals from the plan upon retirement.

Read more

TaxConnections