Tax and Business Alert - March 2014



Welcome to this month's edition of the Tax and Business Alert. Our goal is to provide you with current articles on various tax and business topics. The articles are intended to keep you up to date on trends and issues that may impact your business and personal financial affairs. Please contact us if you have questions about any of the issues discussed.

FILING STATUS FOR SEPARATED, DIVORCED OR DIVORCING COUPLES
People who are in the process of divorce might still be married for tax purposes. This brief article notes the five tax filing categories for individuals. Read more...

LIFETIME VS. TESTAMENTARY CONTRIBUTIONS
Many taxpayers with charitable intentions struggle with the decision of whether to donate property to charity during their lifetimes or to make a charitable bequest in their wills that will be fulfilled from property included in their estates (testamentary bequests). While taxpayers frequently base their choice between lifetime charitable gifts and testamentary bequests on nontax considerations, this article discusses the tax implications of their decision. Read more...

MINIMUM REQUIRED DISTRIBUTION REMINDER
This brief article notes that taxpayers who turned 70½ in 2013 need to prepare to take their first minimum required distribution or face a steep penalty. Read more...

PASSIVE ACTIVITY LOSS LIMITATIONS
The passive activity loss (PAL) rules were introduced by the Tax Reform Act of 1986 and were designed to curb perceived tax shelter abuses. However, the PAL rules are far-reaching and affect activities other than tax shelters. Additionally, these rules limit the deductibility of losses for federal income tax purposes. This article explains what constitutes a passive activity and particularly how the rules affect rental activities. Read more...

TAXPAYER ADVOCATE REPORTS TO CONGRESS
National Taxpayer Advocate Nina E. Olson recently released her annual report to Congress, urging the Internal Revenue Service to adopt a comprehensive Taxpayer Bill of Rights (TBOR) - a step she said would increase trust in the agency and, more generally, strengthen its ability to serve taxpayers and collect tax. This article looks at why she feels the IRS is not performing up to its potential level of effectiveness. Read more...

WHEN IS A MARRIAGE TERMINATED FOR TAX PURPOSES?
This article explains the situations in which a marriage is considered terminated for tax purposes. In some divorce situations, where the "abandoned spouse" rule does not apply, a spouse may be reluctant to file a joint return due to the joint and several tax liability resulting from joint returns. In some instances, completing the divorce and terminating the marriage may in fact save income taxes. Read more...

This publication is distributed with the understanding that the author, publisher and distributor are not rendering legal, accounting or other professional advice or opinions on specific facts or matters, and, accordingly, assume no liability whatsoever in connection with its use. The information contained in this newsletter was not intended or written to be used and cannot be used for the purpose of (1) avoiding tax-related penalties prescribed by the Internal Revenue Code or (2) promoting or marketing any tax-related matter addressed herein. © 2014