Corrected Foreign Housing Cost Exclusions for 2018

Posted by Kim Chen on May 4th, 2018

A U.S. citizen (or U.S. resident alien) living abroad can elect to exclude the foreign earned income and housing cost amount from gross income (subject to certain limitations). The Section 911 housing cost exclusion is calculated based on the number of days physically present in the foreign location. In addition, the IRS allows a higher […]

IRS Provides Small Employer Health Care Credit Relief

Posted by Kim Chen on May 2nd, 2018

Eligible small employers that pay a portion of the premiums for employee health care coverage in a qualified health plan through a state insurance marketplace’s Small Business Health Options Program (SHOP) are eligible for a tax credit of up to 50% of employer-paid premiums for up to two consecutive years under IRC Sec. 45R. The […]

Tax Treatment Of Alimony Under The New Law

Posted by Kim Chen on February 28th, 2018

Under the current rules, an individual who pays alimony or separate maintenance may deduct an amount equal to the alimony or separate maintenance payments paid during the year as an “above-the-line” deduction. (An “above-the-line” deduction, i.e., a deduction that a taxpayer need not itemize deductions to claim, is generally more valuable for the taxpayer than […]

Related-party Transfers Didn’t Increase Basis in S Corporation Stock

Posted by Kim Chen on February 26th, 2018

The taxpayer, a real estate developer, held interests in various LLCs, partnerships, and S corporations (collectively, the “affiliate companies”). In 2004, he formed an S corporation to purchase a condominium complex in a bankruptcy sale. During 2004 through 2008, the affiliate companies regularly paid expenses, such as payroll costs, on behalf of the newly-formed S […]

IRS UPDATES GUIDANCE ON EMPLOYER SHARED RESPONSIBILITY, INCLUDING 2018 PENALTY AMOUNTS

Posted by Kim Chen on February 23rd, 2018

Questions and Answers on Employer Shared Responsibility Provisions Under the Affordable Care Act IRS has updated questions and answers (Q&As) on its website that provide guidance on employer responsibilities under Code Sec. 4980H. Background. Code Sec. 4980H, which was added by the Affordable Care Act (ACA), provides that an applicable large employer (ALE; see below) […]