Tax Advice & News

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Whistleblower Tax Dispute Illustrates What Constitutes A Business And Related Expenses

September 2013 A federal district court, in the matter of Bagley, No. 2:10-cv-00483-RT-FMO (C.D. Cal. 8/5/13), has determined that Richard Bagley was engaged in the trade or business of pursuing False Claims Act lawsuits against his former employer and was thereby entitled to deduct legal expenses related to that endeavor as ordinary and necessary business expenses. Mr. Bagley was the chief financial [...]

2019-03-06T10:14:30-08:00Tax Advice & News|

Whistleblower Recovery Is Ordinary Taxable Income

August 2012 The Ninth Circuit decided a taxation case of first impression involving whether a qui tam or whistleblower recovery provides a taxable capital gain from a sale of property, or ordinary taxable income. The District Court in Los Angeles, and the Ninth Circuit both agreed with the IRS that the higher rate of taxation [...]

2019-03-01T11:55:13-08:00Tax Advice & News|

Reasonable Compensation Analysis Needed For Closely-Held Corporations

March 2012 Reasonable compensation questions affect millions of closely-held corporations whose owners actively participate in the business.  The issue involves how much payroll taxes are due from the earnings of the business.  Amounts not characterized as salary are reported as S-corporation income on the shareholder’s personal tax return, where it is not subject to payroll [...]

2019-03-01T11:33:53-08:00Tax Advice & News|

Goodwill Impairment Tests Become Easier

September 2011 In September 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2011-08, entitled “Testing Goodwill for Impairment”.  This amends guidance in Generally Accepted Accounting Principles (GAAP) Topic 350 involving goodwill and other intangible assets.  Because early adoption is allowed, and the new guidance significantly simplifies the current procedures, expect the new [...]

2019-02-28T12:45:09-08:00Tax Advice & News|

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