Tax Insights

Related documents

•   Tax Insights: IRS provides relief under gain recognition agreement rules (112 KB)

  The IRS issued an LMSB Directive on July 26, 2010, that provides guidance relating to certain gain recognition agreements (GRAs) that may not satisfy the requirements of Treas. Reg. Sec. 1.367(a)-8(c)(2). The memorandum could provide relief to taxpayers who have filed incomplete GRAs.

•   Tax Insights: The new Chapter 4 withholding regime (243 KB)

  This new withholding regime is directed at certain withholdable payments made to Foreign Financial Institutions and other foreign entities. Although these new withholding rules generally are effective for payments made after Dec. 31, 2012, taxpayers will need to begin evaluating these rules today because of the administrative complexities that they will impose.

•   Tax Insights: Legislation could make grantor retained annuity trusts less valuable estate planning tools (107 KB)

  A legislative proposal that would make future asset transfers to a grantor retained annuity trust (GRAT) a riskier and less valuable estate planning strategy is being considered in Congress. The provision was first proposed by the administration and has now passed the House of Representatives as a revenue raiser on two separate small business tax incentive bills.

•   Tax Insights: IRS sends 1,200 mandatory 401(k) compliance questionnaires (102 KB)

  The IRS Employee Plans Compliance Unit has sent 401(k) Compliance Check Questionnaires to 1,200 employers who sponsor a 401(k) plan. The information gathered through the questionnaires is intended to provide the IRS with a comprehensive view of 401(k) plans and help the IRS maximize its resources for education, outreach, guidance and enforcement.

•   Tax Insights: IRS denying protective claims for refund for FICA taxes on severance payments (105 KB)

  The IRS’s action appears to be a broad-based response to the many protective claims filed by employers since the Quality Stores ruling, and while not unprecedented, it is a response that many in the industry did not expect. Grant Thornton has identified several possible courses of action to an IRS denial.

•   Tax Insights: Relief for some under HIRE Act expansion of Section 6501(c)(8) extended statute of limitations rule (134 KB)

  The Hiring Incentives to Restore Employment Act signed into law on March 18, 2010, amended the exception to the three-year statute of limitations under Section 6501(c)(8) related to certain foreign information returns (updated on June 21, 2010).

•   Tax Insights: Health care bill offers $1 billion opportunity to biotech and other health-related companies (114 KB)

  The recently enacted health care reform legislation (H.R. 3590) includes a generous new tax credit that could benefit biotech firms and other health companies with fewer than 250 employees. These questions and answers are intended as a general guide to the new Therapeutic Discovery Project Credit.

•   Tax Insights: Healthcare reform to create new excise tax on medical device sales (38 KB)

  The recently enacted healthcare reform legislation creates a new excise tax affecting manufacturers, importers and producers of medical devices. This new 2.3 percent excise on medical device sales was added by the reconciliation healthcare bill signed by the president on March 30, 2010 (H.R. 4872).

•   Tax Insights: Court rules severance payments not subject to FICA (97 KB)

  This ruling provides an opportunity for employers who have paid severance as a result of downsizing or for other reasons during years 2006 through 2010 to file protective refund claims relating to FICA tax that was paid on the severance payments.

•   Tax Insights: New hiring tax incentives provide unique taxpayer opportunity (111 KB)

  Under the new law, businesses can receive an exemption from the 6.2 percent employer share of Social Security taxes on new hires that were previously unemployed and an additional credit of up to $1,000 if the workers are retained for 52 weeks.

•   Tax Insights: Plan sponsors now required to post Form 5500 actuarial information on sponsor’s intranet (98 KB)

  These requirements apply for plan years beginning after Dec. 31, 2007 (i.e., calendar 2008 plan year), and do not apply to defined contribution plans such as a Section 401(k) plan. The Department of Labor has not issued regulations or provided any formal guidance on this disclosure requirement. Thus, plan sponsors will need to determine how they will comply with this requirement.

•   Tax Insights: FAQ: When, how and why to make a 2010 Roth IRA conversion (148 KB)

  2010 may be the ideal time to convert from a traditional tax-preferred retirement account to a Roth IRA. Tax rates are low, stock prices are depressed, and the $100,000 adjusted gross income (AGI) limit on rollovers has just disappeared.

•   Tax Insights: Estate tax repeal in 2010 raises transfer tax issues (114 KB)

  Drastic and temporary changes in transfer tax rules raise many issues for taxpayers with carefully crafted estate plans. Opportunities and concerns are magnified by the scheduled return to 2000 transfer tax rules beginning in 2011. The outlook is also complicated by the prospect of congressional action to change the 2010 rules — action that could be retroactive to Jan. 1, 2010, and extended into 2011 and beyond.

•   Tax Insights: House passes carried (profits) interest legislation (149 KB)

  The carried interest provision generally would cause income attributable to carried (or profits) interests to be taxable at ordinary income rates (as opposed to capital gains rates) and subject to self-employment taxes in the case of income reported by an individual.

•   Tax Insights: Year-end brings reporting considerations for employers of international assignees (102 KB)

  As 2009 comes to a close, companies with employees on international assignments either in the United States or abroad should focus on year-end compensation reporting. It is essential to understand the basic technical principles of global compensation reporting because it can be a challenge to manage processes that ensure compensation is reported timely and accurately.

•   Tax Insights: Employers face new IRS reporting requirements for incentive stock options and employee stock purchase plans (127 KB)

  New reporting requirements will go into effect next year for incentive stock options and employee stock purchase plans. Corporations should be preparing now to collect the necessary information, which must be reported to both employees and the IRS.

•   Tax Insights: NOL carryback extension provides key taxpayer opportunity (108 KB)

  The new law allows taxpayers to carry back net operating losses from any one year beginning or ending in 2008 or 2009 for three, four or five years — and it suspends the 90 percent alternative minimum tax limitation for the carried back NOL.

•   Tax Insights: Income limit on Roth IRA conversion disappears in 2010 (123 KB)

  The perfect storm is gathering in 2010 — potentially creating the ideal time for high-income Americans to reposition their retirement savings and enhance tax savings. The repeal of the income limit on a Roth IRA conversion is scheduled to kick in just when your IRA account may be at its weakest and tax rates may be at their lowest.

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