The Internal Revenue Service has expanded its Voluntary Classification Settlement Program (VCSP), paving the way for more taxpayers to take advantage of this low-cost option for achieving certainty under the law by reclassifying their workers as employees for future tax periods. The IRS is modifying several eligibility requirements, thus making it possible for many more…
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3.8% Medicare Investment Tax on CFC's and PFIC's Income?
A new 3.8% tax, commonly known as the “Medicare tax,” is scheduled to take effect for taxable years following December 31, 2012. The tax is imposed on the lesser of net investment income (“NII”) or the excess of a taxpayer’s modified adjusted gross income over a threshold amount. For married taxpayers filing jointly, the threshold…
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IRS Outlines Sequestration Plans Including 5 to 7 Day Furloughs
With mandatory government spending cuts looming, Acting IRS Commissioner Steven Miller sent a Memo to all IRS employees on Thursday (See Below), outlining the agency’s plans in the event sequestration occurs as planned on Friday. He outlined spending cuts the IRS plans to make, including employee furloughs, but emphasized that the furloughs would not affect…
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DOJ Wins $1 Billion Tax Shelter Case Against Dow Chemical.
The Justice Department has won a tax shelter case involving Dow Chemical, in which the company was accused of creating approximately $1 billion in phony tax deductions in a scheme designed by Goldman Sachs and lawyers at King & Spalding. A federal court in Baton Rouge, La., on Monday rejected two tax shelter transactions entered…
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