Tax Development Journal Volume 6 (Fall 2016)
http://hdl.handle.net/10211.3/176191
This collection houses the Tax Development Journal Volume 6 (Fall 2016)2024-03-28T21:03:15ZNew heightened reporting requirements for foreign financial activities: What every fiduciary should know about a decedent's unfulfilled compliance obligations
http://hdl.handle.net/10211.3/176201
New heightened reporting requirements for foreign financial activities: What every fiduciary should know about a decedent's unfulfilled compliance obligations
Ambrosio, Fabio
Given that reporting requirements for foreign transactions are at the highest level in history and the government's own figures estimate that 98.7 percent of tax revenue lost to offshore sheltering is not recouped through Offshore Voluntary Disclosure Initiative (OVDI) programs, it can be deduced that the vast majority of cross-border transactions remain undisclosed. This paper explores whether, upon the death of a taxpayer, his/her unfulfilled obligation to file certain information returns with respect to foreign financial activities survives him/her. To the extent that another taxpayer, as fiduciary, inherits the decedent's burden to file delinquent information returns, this paper outlines the ambiguity regarding the statutory authority of the Internal Revenue Service (IRS) to collect the liability for related civil penalties personally against the fiduciary. While the IRS believes it has the authority to do so, this paper suggests otherwise. Through a factual scenario focused on Section 6048 of the Internal Revenue Code, this paper concludes that a taxpayer's obligation to file information returns with respect to certain foreign financial activities survives him/her. The estate inherits this filing obligation as well as the liability for civil penalties due to the late filing. However, to the extent that the estate's assets are prematurely distributed, there remains a genuine doubt about the IRS's ability to use Section 6901 of the Internal Revenue Code in order to collect against a fiduciary, even in cases where the executor had notice of the claim before making a distribution. It is important to understand that this paper specifically discusses the authority of the IRS under Title 26 to collect certain penalties against fiduciaries. This paper does not suggest that the U.S. Government at large, through another agency or pursuant to the authority of another title of the US Code, would not have the authority to so collect.
2016-01-01T00:00:00ZLand ho! Navigating the murky waters of guaranteed lifetime income and the annuity safe harbor for 401(k) plans
http://hdl.handle.net/10211.3/176202
Land ho! Navigating the murky waters of guaranteed lifetime income and the annuity safe harbor for 401(k) plans
Sterner, Beth
Due to a collective federal goal of providing Americans with guaranteed sources of lifetime income, namely annuities, as a retirement income strategy, numerous regulations and proposed rules have been issued that allow the use of annuities in defined contribution retirement plans. Despite this goal, annuities are rarely offered to participants in a 401(k) plan. This can be explained, in part, by confusion in properly applying these rules to 401(k) plans. Because of the widespread belief that the "Annuity Safe Harbor" lacks well-defined and measurable standards, many retirement plan fiduciaries simply refuse to expose themselves to the greater risk of liability associated with annuities. This article provides a compass to guide advisers and 401(k) plan fiduciaries safely into the Annuity Safe Harbor, specifically when selecting and monitoring annuity providers and products. First, the background of using annuities for retirement income is explored. Next, the article identifies obstacles to the selection and monitoring of annuity providers and products and provides an overview of recently issued federal regulations and proposed rules expanding the use of annuities in 401(k) plans. In light of impediments to guaranteed lifetime income for 401(k) participants, federal legislative and regulatory actions are proposed. Lastly, guidance is offered from industry experts and recent cases involving the breach of fiduciary duties.
2016-01-01T00:00:00ZNew rules for audits of partnership returns
http://hdl.handle.net/10211.3/176203
New rules for audits of partnership returns
Gianni, Monica
Effective for audits of partnership returns beginning after 2017, the IRS will use a centralized audit system that requires partnership adjustments to be determined at the partnership level and any tax attributable to the adjustments to be assessed and collected at the partnership level. These new rules allow for a small-partnership opt-out and an elective alternative to "push out" the audit adjustments made and tax paid to the partners. The audit process will be streamlined by limiting the right to notices and participation in the audit to one "partnership representative." This article presents the new rules and existing guidance that consists of a report by the Joint Committee on Taxation and temporary regulations on an early opt-in to the rules prior to their effective date.
2016-01-01T00:00:00ZIt's super effective: Section 911 as a policy silver bullet
http://hdl.handle.net/10211.3/176204
It's super effective: Section 911 as a policy silver bullet
Randles, Theodore
The United States is one of the few countries in the world that imposes tax on all of its citizens regardless of where they reside. U.S. citizens resident abroad must deal with the tax systems of both the United States and the country of their residence. The burden of so-called "worldwide taxation" is lessened by the Foreign Earned Income Exclusion, which allows U.S. citizens to exclude their actively earned income up to a cap. This paper explores the policy rationales that support the Foreign Earned Income Exception and recommends slight changes in the exclusion to further those policies.
2016-01-01T00:00:00Z