Hurricane Harvey & IRS Casualty Loss Deduction
As Houston recovers from what some consider to be a 1 in 1,000 year event, only 15% of Houston residents are protected by flood insurance. Undoubtedly, there will be massive personal and business losses. A casualty loss deduction on your tax return can help offset some the cost of repairs. The first few weeks after a natural disaster are very important in properly documenting a casualty loss claim and here are some important things you need to know for tax purposes.
IRS Form 3520 – What are the Reporting Requirements and Tax Consequences of Receiving a Gift from a Foreign Person?
It is a common scenario where a U.S. person receives a gift from a parent or relative who lives abroad. Such transactions usually trigger a Form 3520 filing requirement. There are two steps to determining the tax and reporting consequences of such transactions.
Community Property and IRS Tax Liabilities
What is Community Property?
Texas is a community property state, which means that all “community property” is owned jointly and equally by both spouses. In Texas, all property accumulated during marriage is community property unless it is received by gift, devise, or inheritance. Tex. Fam. Code Ann. § 5.01. Even income derived from separate property—including interest and dividends from separately owned securities—is considered community property. Commissioner of Internal Revenue v. Chase Manhattan Bank, 259 F.2d 231, 239 (5th Cir. 1958), cert. den., 359 U.S. 913 (1959). Texas’s community property laws can have unusual implications for married couples’ federal income tax liabilities.
What Happens After an IRS Audit?
Clients often come to us after going through an IRS audit and receiving a large tax bill. They either represented themselves or hired someone who did not represent them effectively. This article is not about audit representation, but rather the steps that occur after an audit has concluded, and what taxpayers can do to challenge an audit determination. Read more