Happy Thanksgiving from NSTP! The Board members, instructors, Tax Helpline staff, and office staff want to take this opportunity to wish you a Happy Thanksgiving!
HSAs and Health Insurance HSAs are tax-advantaged arrangements that can be used to manage health deductibles and out-of-pocket costs and also allow taxpayers to save for future health care expenses. Many employers have an HSA option available for their employees. If the employer does not offer it, check with the bank or brokerage firm about whether you can fund an HSA for yourself or your family. Eligibility for HSAs is restricted. You must have a high-deductible health plan to qualify. The minimum allowable deductible for 2020 is $2,800 for family coverage and $1,400 for self-only coverage. And out-of-pocket costs, including copayments, cannot exceed $6,900 a year for individual coverage and $13,800 for family coverage. Expenses for preventive care can be covered dollar for dollar by HDHPs, even if the deductible has not been met. Alternatively, preventive medical costs can be covered by a lower deductible, depending on the terms of the insurance policy. This past summer, IRS relaxed the rules for people with certain chronic illnesses. Some services and drugs for a range of chronic conditions are treated as preventive care that can be covered by HDHPs, including blood pressure monitors for hypertension, statins for heart disease, and selective serotonin … Read More
Tax Professionals Opinion On Agency Changes Sought by IRS Commissioner from Accounting Today online, (edited) Internal Revenue Service Commissioner Charles "Chuck" Rettig told an audience of tax professionals and accountants at the AICPA National Tax Conference in Washington, D.C., on Thursday that he wants to hear from them about the impact of the far-reaching IRS reform legislation that Congress passed earlier this year. He discussed the Taxpayer First Act, the IRS reform package that was enacted July 1. “It basically provides us with the opportunity to look at a change in the footprint of the Internal Revenue Service, a restructuring of the Internal Revenue Service, if you will,” said Rettig. “We're moving forward with the idea that we have the opportunity to restructure.” The IRS is looking at ways to improve services for both taxpayers and practitioners. “I can do a lot of service, but not actually change your experience,” said Rettig. “And I can sleep well at night thinking, well, I did what I was supposed to do and I'm performing at a high level. But if I don't enhance your relationships with us, whether you're a practitioner or a taxpayer, a vendor or software provider or whoever, then … Read More
Auditing for Due Diligence Compliance Audits for compliance with due diligence for certain tax benefits, such as the earned income tax credit (EITC), child tax credit (CTC), including additional child tax credit (ACTC), credit for other dependents (ODC), American opportunity tax credit (AOTC) and/or the head of household (HOH) filing status, as defined by IRS Section IRC 6695(g) are another tier of the IRS Preparer Compliance Program. They look at returns with a high chance of errors completed by the same preparer and use that information to select preparers for due diligence visits. (See Preparer Compliance – Focused and Tiered). Due Diligence Visit Before the filing season begins, IRS employees conduct due diligence visits based on the prior year returns. These due diligence visits are either face-to-face or conducted via correspondence. IRS will contact you with either Letter 6199 (Due Diligence Visit Request) or Letter 6222 (Correspondence Due Diligence IDR) to initiate a due diligence visit. These letters ask you to respond within 14 days to either set up an appointment at your office (Letter 6199) or send information and schedule a telephone interview (Letter 6222). Please call the examiner listed by the date noted. The examiner will give you more information … Read More
Enrolled Agent Forms Reissued The IRS has reissued Form 23, Application for Enrollment to Practice Before the Internal Revenue Service, and Form 8554, Application for Renewal of Enrollment to Practice Before the Internal Revenue Service. These are two forms that must be submitted by tax professionals who want to practice before the IRS as enrolled agents (EAs). Form 23 is filed by first-time applicants who are eligible to be enrolled as EAs and who have not previously practiced before the IRS. The form notes that prior to submitting the form, applicants must pass the Special Enrollment Examination (SEE) and obtain a Preparer Tax Identification Number (PTIN). It adds that for former IRS employees, the eligibility to practice may be limited by the applicant's work experience. Regardless of prior work experience, a waiver with respect to the SEE may be available for former IRS employees who submit an application within three years from the date of leaving employment with the IRS. Form 8554 is used to renew status as an EA with either "active" status or "inactive retirement" status. All agents who wish to renew their enrollment must have an active PTIN, and complete 72 hours of continuing education credit (less … Read More
NSTP Federal Tax Update & Review Courses For the information you need this upcoming tax season, whether you are setting up appointments for 2019 tax planning or preparing for the 2020 tax filing season, the NSTP Federal Tax Update And Review Courses will get you ready. The sessions will include the information you need to help your clients prepare for filing their 2019 tax returns. And, as always, the Federal Tax Update and Review courses all include a networking lunch in your registration fee. Following is a sampling of the topics we will be covering: Interest exclusion for higher education. For 2020, the phase-out for excluding interest on U.S. savings bonds redeemed to pay qualified higher education expenses will begin at modified adjusted gross income (MAGI) above $82,350 ($123,550 on a joint return). For 2019, the corresponding figures were $81,100 and $121,600. Qualified transportation fringe benefits. For 2020, an employee will be able to exclude up to $270 (up from $265 for 2019) a month for qualified parking expenses, and up to $270 a month (up from $265 for 2019) of the combined value of transit passes and transportation in a commuter highway vehicle. Lifetime learning credit phaseout. For 2020, a taxpayer’s MAGI … Read More