Under the current U.S. tax law, canceled debt is normally taxable to you, but there are exceptions. One of those exceptions is came into existence under the Mortgage Forgiveness Debt Relief Act of 2007. Under this law, married homeowners whose mortgage debt is partly or entirely forgiven during tax years 2007 through 2012 may exclude [...]

On February 23, 2012, the IRS announced that the underpayment and overpayment interest rates will remain the same for the calendar quarter beginning April 1, 2012. The rates will be: three (3) percent for overpayments (two (2) percent in the case of a corporation) three (3) percent for underpayments five (5) percent for large corporate [...]

On February 23, 2012, the Internal Revenue Service released revised Form 941 enabling employers to properly report the newly-extended payroll tax cut benefiting nearly 160 million workers. The IRS needed to revise Form 941 due to the Middle Class Tax Relief and Job Creation Act of 2012 (enacted on February 22, 2012). Under the new law, [...]

A W-2 is required to be filed by every employer who is engaged in a trade or business paying remuneration (including noncash payments) of $600 or more for a year in which services are performed by an employee.  A W-2 must be filed for each employee for whom income, Social Security, or Medicare tax was [...]

For the U.S. tax compliance purposes, it is very important to properly classify foreign business entities, because there are special IRS requirements associated with ownership of foreign business entities. For instance, a list of various tax forms is tied to particular classification (for example, certain U.S. taxpayers are required to file Form 5471 with respect [...]

The Alternative Minimum Tax (AMT) is an additional tax that certain individuals must pay on top of their regular tax liability.  When the original “minimum tax” was enacted in 1969, its purpose was to limit the ability of high-income earners from paying little or no tax by using certain tax breaks.  Tax breaks that may [...]

In a previous article, we covered some of the basics of Form 941. In this article, we will explore some of the major penalties that may apply for failure to comply with the requirements of Form 941. These penalties may be severe and, in certain circumstances, may even lead to criminal charges. Failure to File [...]

On February 8, 2012, the U.S. Treasury Department and the Internal Revenue Service issued proposed regulations for the next major phase of implementing the Foreign Account Tax Compliance Act (FATCA). FATCA and FFI Reporting under Proposed Regulations FATCA was enacted by the U.S. Congress in 2010 as part the Hiring Incentives to Restore Employment (HIRE) [...]

The purpose of this article is provide a general background to one of the most important terms in international contract drafting, Incoterms 2010 CPT. General Provisions of CPT CPT (Carriage Paid To) means that the seller delivers the goods to the carrier of another person nominated by the seller at an agreed place and that [...]

The recent oil boom in regions such as the Bakken Oil Field has created millionaires overnight based upon royalty interests in oil and gas leases of investors. While fortunes can be made from such payments, it is important to understand that there may be various potential risks involved, as well as numerous taxes. This article [...]