Category Archives: Announcements

Nolo is proud to be considered the premier site for go-to consumer legal information. Find out the newest announcements from Nolo here – from site-wide updates to must know product information – THIS is the place to learn everything you need to know about what’s new with Nolo.

IRS SIMPLIFIES SECTION 83 ELECTION PROCEDURES

In a recent private letter ruling, IRS acknowledged that the failure to attach a copy of a Section 83(b) election to the tax return didn’t negate the election as long as the election was, in fact, filed with IRS within 30 days of the date of transfer, which has long been the rule.

And in recently proposed regulations, IRS has further formalized this new stance in proposing elimination of the requirement that taxpayers attach a copy of the election to the tax return. For one thing, IRS believes this bit of simplification (applicable to property transfers on or after January 1, 2016) will promote the e-filing of tax returns.

NO EARLY DISTRIBUTION PENALTY WAIVER DESPITE “FINANCIAL HARDSHIP”

In the recent Kott decision (TC Summary Opinion 2015-42), the Tax Court took a hard line in the case of a 401(k) distribution to a taxpayer under age 59-1/2 even though he used the money to catch up on his delinquent mortgage payments in an effort to avoid foreclosure.

The Code does provide for certain exceptions to the application of the penalty, but Courts have held that those exemptions do not include a general “financial hardship” situation, even though such a situation can allow the plan to actually make the distribution itself.

“EXTENDERS” IN LIMBO

As Congress contemplates its usual August hiatus, taxpayers wonder what fate will befall late 2014 “extender” provisions of the law which won’t apply to 2015 unless action is taken. Among the more important provisions whose 2015 fate is still unlearned are:

~Deduction for state and local sales taxes
~Deduction for mortgage insurance premiums treated as qualified interest
~Exclusion from gross income of up to $2 million of discharged principal residence indebtedness
~Deduction of up to $500,000 in cost of certain otherwise depreciable business property, and applicability of 50% “bonus depreciation”
~Tax free distributions for charitable purposes from IRAs of taxpayers age 70-1/2 or older

IRS POINTERS REGARDING IDENTITY THEFT

If you’ve been victimized by an identity thief relative to your tax filings, check out IRS Summertime Tax Tip 2015-1 for IRS’ suggested ten things to know about identity theft.

Of particular interest is (yet another) IRS form which may be necessary in your circumstances: Form 14039, “Identity Theft Affidavit” which is reasonably simple to fill out, and which the victim should then submit to IRS.

IRS PARTNERS WITH TAX PROS TO FIGHT IDENTITY THEFT

IRS recently announced “a sweeping new collaborative effort” in joining forces with tax preparation and software firms, payroll and tax financial processors and state income tax administrators with a view toward combating identity theft refund fraud.

Commissioner Koskinen says, “We’ve made tremendous progress, and we will continue these efforts. Taxpayers filing their tax returns next filing season should have a safer and more secure experience.”

Check out IR 2015-87 for more of the details on how IRS plans to work with the tax industry for improved:

~Taxpayer authentication
~Fraud identification
~Information sharing
~Cybersecurity framework
~Taxpayer awareness and communication