Taxpayers Get a Break on New 1099-K Regulations
Someone in the IRS finally came to their senses and decided a little more thought needed to be placed on the implementation of the new 1099-K regulations.
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Tax Laws
Increase in Retirement Contribution for 2024
The Internal Revenue Service announced that the amount individuals can contribute to their 401(k) plans in 2024 has increased to $23,000, up from $22,500 for 2023.
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The Supreme Court Takes up the Sixteenth Amendment
The Supreme Court on Dec. 5 will take up an important case about "unrealized" income that considers the constitutional limitations on federal taxing power.
The case is important because the court could use it to strike down the Mandatory Repatriation Tax (MRT), also known as the Section 965 transition tax, which was part of the Tax Cuts and Jobs Act approved by the Republican-controlled Congress in 2017 and signed into law by then-President Donald Trump.
The IRS Wants Their Money BACK!
The Internal Revenue Service (IRS) has initiated a crackdown on the dubious Employee Retention Credit (ERC) claims, mailing over 20,000 disallowance letters to taxpayers and entities that did not exist or had no employees during the eligibility period.
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Standard mileage rates for 2024
The IRS has announced that the optional standard mileage rate for business use of an automobile will increase by 1.5 cents starting January 1, 2024, to 67 cents per mile. The depreciation element increases to 30 cents. The rates apply to electric, hybrid, and gasoline-powered vehicles.
The mileage rate for medical/moving purposes decreases to 21 cents per mile (from 22 cents per mile in 2023).
The mileage rate for service to charitable organizations remains at 14 cents per mile. The charitable mileage rate is a statutory rate and not indexed.
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Think Twice About Leaving Your IRA to Your Children
Prior to 2020, a "Stretch IRA" was used to extend the tax-deferred status of an inherited IRA when it passed to a non-spouse beneficiary (i.e. children and/or grandchildren). This way you could pass an IRA down to the next generation and beneficiaries would enjoy the tax benefits of an IRA over their respective lifetimes.
House Committee Advances Pro-Growth Tax Relief Package
In a bipartisan vote, the Ways and Means Committee approved legislation to help American job creators stay competitive, allow Main Street businesses to survive and grow, and give tax relief to working families struggling under the weight of elevated prices and interest rates. The Tax Relief for American Families and Workers Act also accelerates the end of the COVID-era Employee Retention Tax Credit (ERTC), a program rife with fraud and cost overruns, that will save taxpayers over $70 billion.
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Guidance on Miscellaneous Parts of the SECURE 2.0 Act
Increased small employer plan start-up credit
Eligible small employers may claim a general business credit of up to $5,000 for the cost of establishing a pension plan, such as a SEP or SIMPLE plan, for eligible employees. An eligible employer is one with 100 or fewer employees who received at least $5,000 in compensation the previous year. The credit is allowed for the year the plan is established and each of the two subsequent years.
For plan years starting after Dec. 31, 2022:
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Congress Finally Fixes Service Member Residency Requirements.
One of the most - I think - was the tax rule concerning those whose join the military was that your state of residence for tax purposes was where you signed up for the military. So, if you joined the military from a state that has state income tax laws, you had to pay state taxes to to that state - even if you currently live in a state that had no tax.
Congress finally fixed it.
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