Self-employment tax receives different treatment

The Tax Court has once again concluded that net earnings from self-employment is not reduced by a net operating loss carried forward or carried back to the tax year at issue. Joseph DeCrescenzo and the IRS both agreed that he earned $131,660 of self-employment income...

Important tax question: Is it salary or dividends?

An S corporation shareholder-employee’s $24,000 annual salary was unreasonably low, the Court of Appeals for the Eighth Circuit concluded, so it allowed the IRS to reclassify $67,000 in dividend payments as salary. As a result, the corporation owed employment...

FRAUD ALERT: Beware of bogus tax refund schemes

The IRS has issued a warning to senior citizens and other taxpayers about an emerging scheme that tempts them to file tax returns to claim fraudulent refunds. The scheme carries a common theme of promising refunds to people who have little or no income and normally do...

Are you overlooking credits for college expenses?

Two federal tax credits – the American Opportunity Credit and the Lifetime Learning Credit – may help offset the costs of higher education for you or your dependents. To qualify for either credit, you must pay postsecondary tuition and fees for yourself,...