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William Byrnes (Texas A&M) tax & compliance articles

TaxFacts Intelligence: Nov 18, 2022

Posted by William Byrnes on November 18, 2022

The Texas A&M Master and LL.M. programs (e.g. international tax, transfer pricing, wealth management, or risk management) are accepting applications from financial professionals and from lawyers. Over 850 enrolled, the enrollment for a course’s section is kept to between 20 and a maximum of 30 so that each student receives meaningful feedback throughout the course from the full-time academic faculty and renowned professional case study leaders, and each other via teamwork and peer review. https://law.tamu.edu/distance-education

Prof. William H. Byrnes         Robert Bloink, J.D., LL.M.

This week, we have a reminder for taxpayers who have yet to make use of their employer-sponsored benefits for the 2022 tax year. The IRS has also provided some clarification on which international tax returns qualify for penalty relief under Notice 2022-36–and reminds taxpayers that Paycheck Protection Program (PPP) loans that were improperly forgiven should be included in taxable income. We repeat some of the information that we provided our subscribers below.

IRS Reminds Taxpayers of Updated Contribution Limits for FSAs, Transportation Benefits in 2022. Time is running out for taxpayers to make use of FSAs and transportation benefits.  In 2022, taxpayers are entitled to contribute a maximum of $2,850 to their health FSAs (up from $2,750 in 2021). The health FSA carryover amount also increased to $570 (so that taxpayers can carry over $570 in unused funds into 2023, up from $550 in 2021). For dependent care FSAs, the annual contribution limit will be $5,000 per married couple in 2022 (the limit was temporarily increased to $10,200 for 2021). The limit on tax-preferred transit/parking benefits also increased from $270 to $280 per month in 2022.  Employers who offer these types of benefits should update their plan documents and communicate the increased limits to employees.  For more information on the types of tax-preferred transportation benefits that employers can offer employees, visit Tax Facts Online. Read More 

IRS Clarifies Who Qualifies for Late Penalty Relief. The IRS has provided penalty relief for certain international return penalties and certain information return penalties for the 2019 and 2020 tax years if those returns are filed before September 30, 2022. While Notice 2022-36 was not clear as to which taxpayers qualify for relief, the IRS has revised its Internal Revenue Manual to provide clarification. The IRM provides that only the following returns are eligible for this penalty relief: (1) Form 5471, Information Return of U.S. Persons With Respect to Certain Foreign Corporations, (2) Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business, (3) Form 3520, Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts and (4) Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner. For more information on the international filing requirements and potential penalties, visit Tax Facts Online. Read More  

IRS Reminds Taxpayers: Paycheck Protection Program Loans May Be Taxable.  The IRS has issued a reminder for taxpayers with paycheck protection (PPP) loans that have been improperly forgiven, whether because of omissions or misrepresentations.  Those loans must be included in income and are taxable.  The IRS also encourages taxpayers with inappropriately received forgiveness of their PPP loans to take action in order to come into compliance.  For example, some taxpayers may be able to file amended returns that include forgiven loan proceed amounts in income.  After the fact, the IRS discovered that some recipients who received loan forgiveness did not meet at least one condition for eligibility. Therefore, these loan recipients received forgiveness of their PPP loan through misrepresentation or omission (either because they did not qualify to receive a PPP loan or misused the loan proceeds). For more information on the PPP loan program and rules governing forgiveness, visit Tax Facts Online. Read More 

Look in your Tax Facts Online app for our continuing analysis of 2022 and 2023 legislative and regulatory updates, weekly intelligence, and the impact on planning for a client’s wealth preservation and growth.

Texas A&M, operating budget of $9.6 billion (FY2022) and capital budget of $1.9 billion, is #1 for U.S. public universities, one of only 60 accredited U.S. universities of the American Association of Universities (R1: Doctoral Universities – Highest Research Activity) and one of only 17 U.S. universities that hold the triple U.S. federal grant of Land, Sea, and Space! The law school, ranked in the 1st tier of law schools and is ranked in the top 10 for the employment of its graduating law students among U.S. law schools.

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