AICPA's Tax Update for Financial Executives

• Introduction
• Chapter 1 - C Corporations
  • Transaction Designed as a Reverse Subsidiary Reorganization Treated as Stock Purchase and Subsequent Liquidation
    • Takeaway
  • Amended Regulations Regarding Transfers of Assets or Stock in Reorganizations
  • Takeaway
  • Corporate Distributions — Tax Fraud — Boulware Case Supreme Court Decision — 128 SCt 1168 (2008)
    • Background
    • Supreme Court Decision
    • Takeaway
  • Succession to Items of Liquidating Corporation When Multiple Members Receive Assets
    • Liquidations
    • Deferred Items
    • Intercompany Gain with Respect to Group Member Stock
  • Repayment of Loan versus Corporate Distribution
    • Facts
    • Holding
    • Takeaway
  • Allocation of Additional Tax and AMT Exemption Reduction in Controlled Groups
    • Reduction in Tax Benefits
    • Proportionate Method
    • FIFO Method
    • AMT Exemption Reduction
    • Testing Dates and Periods
  • Final Regulations Excess Benefit Transactions
• Chapter 2 - Flow-through Entities
  • Substantial Economic Effect — Look-through Entity Partners
    • Substantial Economic Effect
    • Final Regulations
  • Proper EIN in F Reorganizations Involving QSubs
    • Takeaway
  • Two Percent Shareholder for-AGI Health Deduction
    • Takeaway
  • Key Person Life Does Not Increase AAA
    • Takeaway
  • S Corp Bank Changing from Reserve Method
    • Background
    • Election Mechanics
    • Takeaway
  • Capital Gains from Stock Sales — Not Passive Investment Income
    • Takeaway
  • Interaction of Built-In Gains and §481 Adjustments
    • Review of Built-in Gain Rules
    • Facts
    • Analysis
    • Takeaway
  • S Corporation Changes in the Mortgage Forgiveness Act of 2007
    • Failure to File S Corporation Return
    • Disclosure of S Corporation Return to Shareholder
  • Late S Election Relief
  • New Relief for S Election
  • New Relief S Election and Entity Classification
  • Takeaway
  • S Corporation Attribution Reduction for Excluded COD Income — Proposed Regulations
  • Partnership Changes in the Mortgage Forgiveness Act of 2007
    • Failure to File Partnership Return
    • Disclosure of Partnership Return to Partner
    • Section 6698 Penalty Increase by $1 for Years Beginning in 2008
  • Partnership and Trust Auto Extension Reduced
    • Takeaway
  • Business Interest of Securities-Trading Partnership Subject to §163(d) Limitation at the Partner Level
    • Takeaway
    • Additional Detail on Interest Expense of Partnerships
    • Further Practical Guidance on Investment Interest of Partners
  • DRO Did Not Increase At-Risk Amount
    • Facts
    • Analysis
    • Takeaway
  • Distinguishing Management Fees of Upper- and Lower-Tier Partnerships
    • Takeaway
  • §704(c) Anti-abuse — Proposed Regulations
    • Background
    • Proposed Guidance
• Chapter 3 - Income and Deductions
  • M&IE Limitation in Employee-Leasing Settings
    • Takeaway
  • Interim CEO Not Considered an Outside Director for the Compensation Limitation of §162(m)
    • Takeaway
  • Payment Not Solely for Performance Goal -Involuntary Termination or Retirement Provisions
    • Takeaway
    • Production Activities Deduction — Regulations Reflect TIPRA Changes
    • Production Activities Deduction — Qualified Film and EAG Matters
  • Treatment of Medicaid Rebates Paid to State Agencies
  • Energy-Efficient Commercial Building Deduction
    • Background
    • Government-Owned Buildings
    • Interim Lighting Rule
    • Other Information Included
    • Takeaway
  • Geological and Geophysical Expenditures of Major Integrated Oil Companies
    • Background
    • Energy Act Increases Period to 7 Years
  • Final Regulations Taxation of Income Earned on Exchange Funds
    • Definitions
    • Loan Treatment
  • Tool Reimbursement Plans
    • Takeaway
  • State and Local Location Tax Incentives
    • Takeaway
  • Start-up Expenditures New Regulations
    • Start-up Costs
    • Organizational Costs
    • Effective Dates
  • Bad Debt Deduction with Corporate Grantor
    • Takeaway
  • Final Regulations — Donees of Intellectual Property
  • Qualified Conservation Contributions
    • Background
    • Provision Extended Two Years
  • Kansas Disaster Area Provisions
    • Casualties
    • Involuntary Conversions
    • Employee Retention Credit
    • Special Depreciation
    • Section 179
    • Expensing Demolition and Clean-up Costs
    • Public Utility Property Disaster Losses
    • Net Operating Losses Due to Storms
    • Income Eligibility for Qualified Residential Rental Projects
    • Using Retirement Funds
  • Housing Act Changes to GO Zone Incentives
    • Use of Amended Returns for Hurricane-Related Casualty Loss Grants
    • Waiver of Deadline on Construction of GO Zone Property for Bonus Depreciation
    • Inclusion of Certain Counties in GO Zone for Tax-Exempt Bond Financing
  • Credit Card Reporting
  • Delay in Applying Worldwide Allocation of Interest
    • Background
    • Implementation Delayed
• Chapter 4 - Gains and Losses
  • Withdrawal of Proposed Regulations Affecting Receivables Acquired for Services
  • Instrument Issued and Redeemed in U.S. Dollars with Euro-Based Return Is Euro-Denominated Debt
    • Takeaway
  • Losses on Abandoned Securities
    • Takeaway
  • Obtaining Like-Kind Replacement Property By Way of a Disregarded Entity
    • Facts
    • Analysis
  • §1031 Exchange — Development Rights for Fee Interest
    • Takeaway
  • LLC Allowed to Revoke Election Out of Installment Method Due to Accountant's Error
    • Takeaway
  • Timber Gain and REITs
    • Background
    • Reduction in Corporate Timber Rate
    • Timber Gain Is Qualified REIT Income without 1-Year Period
    • REIT Prohibited Transaction Safe Harbor
    • Timber REIT
  • Housing Act REIT Changes
    • Foreign Currency Gain Excluded from Income Tests
    • Taxable REIT Subsidiary Limit Increased
    • Holding Period Safe Harbor
    • Health Care REIT
    • Effective Dates
• Chapter 5 - Tax Payments and Credits
  • Guidance Related to the New Energy-Efficient Home Credit
    • Certification
    • Software
    • Manufactured Homes
  • ACE Adjustment — Life/Nonlife Consolidated Groups
    • Facts
    • Analysis
    • Takeaway
  • Estimated Tax Corporation Changes in the Mortgage Forgiveness Act of 2007
  • Adjustment to Students Not Disqualifying a Low Income Housing Unit for §42 Purposes
  • Final Regulations Related to Employment Tax Adjustments
    • Background
    • Interest-Free Adjustments
    • Payments
    • Refunds
  • Energy Act Extends FUTA (0.2%) Surtax through 2008
  • Differential Military Pay as Wages — Heroes Act §105
    • Background
    • Differential Pay within Definition of Wages
  • Employer Wage Credit for Activated Military Reservists — Heroes Act §111
    • Background
    • Employer Wage Credit
  • 990-T Availability
    • Background
    • Notice 2008-49 Guidance
  • Postponement of Deadlines in Disaster Cases
  • Biofuel Credit
    • Background
    • Change to Credit
  • Alcohol Credit
    • Reduction in Rate
    • Limit on Denaturants
  • Modification of Awards — §§48A and 48B
    • Background
    • Modification of Awards
  • Security Tax Credit
  • Housing Credit Changes
    • Temporary Increase in Allocation
    • Increase in Applicable Percentage
    • Modifications to Eligible Basis
    • Other Reform of Low-Income Housing Incentives
    • Treatment of Basic Housing Allowances for Income Eligibility
    • Recycling Tax Exempt Debt
    • Coordination of Low-Income Housing Credit and Qualified Residential Rental Project Exempt Facility Bonds
    • Hold Harmless Provision
    • Annual Recertification Requirement
  • Other Housing Act Bond- and Credit-Related Issues
    • Modifications to Qualified Private Activity Bond Rules for Housing
    • AMT-Related Issues
    • Bonds Guaranteed by Federal Home Loan Banks
    • Modification Related to FIRPTA Nonforeign Affidavits
    • Modification of the Definition of Tax-Exempt Use Property for the Rehabilitation Credit
    • Mortgage Revenue Bonds in Presidentially Declared Disaster Areas
  • Election to Accelerate Research and Minimum Tax Credits
  • Corporate Estimated Tax Gimmickry Changes Again
• Chapter 6 - State Taxes — Nexus
  • Nexus
    • Sales Tax Nexus
    • Income Tax Nexus
  • Allocation and Apportionment
  • Filing Structure
  • Key Items to Remember
• Chapter 7 - Administering Tax Compliance
  • Introduction
  • §1.6001-1(e) Record Retention
  • Revenue Procedure 97-22
  • Revenue Procedure 98-25
  • Transfer Pricing
• Chapter 8 - Accounting Periods and Methods
  • Safe Harbor for Rolling Method of Inventory
    • Takeaway
  • Use of the Recurring Item Exception for Payroll Taxes on Vacation Pay and Bonuses
    • Takeaway
  • Correcting Inventory Calculation — Accounting Method Change
    • Facts
    • Holding
    • Takeaway
  • Alternative Dollar-Value LIFO Pooling Method for Vehicles
    • Vehicle-Pool Method
    • Takeaway
  • Treatment of Expenditures Related to Tangible Assets — Deduct or Capitalize
    • Materials and Supplies
    • Capital Expenditures
    • Facilitative Costs
    • De Minimis Rule for Acquisition or Production of Property
    • Improvements
    • Routine Maintenance Safe Harbor
    • Betterments
    • Restoration
    • Optional Regulatory Accounting Method
    • Repair Allowance
    • Method Change
  • Proposed Regulations for Construction Contracts
    • Background
    • Proposed Guidance
  • Percentage of Completion Method Allowed
    • Facts
    • Reasoning
• Chapter 9 - Depreciation and Amortization
  • Section 179
    • Background
    • Current Limits
    • GO Zone and Enterprise Zones
  • Bonus Depreciation
    • Property Requirements
    • Electing Out and AMT
    • Self-Constructed, Sale-Leaseback, and Related Parties
    • Increased §280F Limit
    • Original Use
    • Interaction with §179 and Regular MACRS
    • Placed in Service and Disposed in the Same Tax Year
    • Like-Kind Exchanges and Involuntary Conversions
    • Change in Use
    • Other Items
  • Depreciation of Racehorses
    • Background
    • Under-Two-Year-Old Horses Are Three-Year Property (2009-2013)
• Chapter 10 - Retirement Plans
  • Limitation Amounts
    • Plan Limits
    • IRA Limits
  • Survivor and Disability Payments — Heroes Act §104
    • Background
    • New Requirements
  • Pension Protection Act Guidance
    • Rollovers to Roth IRAs
    • Additional Survivor Annuity Options
    • Interest Rate
    • Gap Period Earnings
  • Early Distributions from an ESOP
    • Facts
    • Analysis
    • Takeaway
  • Distribution for Unreimbursed Moving Cost Subject to 10% Penalty
  • Disability Payments Converted to Retirement Payments
• Chapter 11 - Worker Classification, Payroll, and Fringe Benefits
  • IRS 20 Factors for Determining Worker Classification
  • Peno Trucking
    • Takeaway
  • Withholding on Supplemental Wages
    • Supplemental Wages
    • Aggregate and Optional Flat Methods
    • Percentage and Wage Bracket Methods for Regular Wages
    • Examples
    • Takeaway
  • Supplemental Unemployment Compensation Benefits — CSX Corp.
    • Facts
    • Analysis
  • HSAs
    • Adjusted HSA Amounts for 2008 and 2009
    • Final Regs — Comparable Contributions — No HSA on December 31
    • Proposed Regulations
    • Notice 2008-52
    • Notice 2008-51
    • Other Guidance
  • Disposing of Unused Health Benefits in an FSA — Heroes Act §114
    • Background
    • Qualified Reservist Distributions Allowed
  • Certain Domestically Controlled Foreign Persons Performing Services under Contract with the U.S. Treated as American Employers — Heroes Act §302
    • Background
    • Controlled Foreign Persons Subject to FICA
  • Parity in Mental Health Benefits — Heroes Act §401
    • Background
    • Extension for One Year
• Chapter 12 - IRS Compliance Matters
  • Change in Realistic Possibility Standard and Return Preparer Definition — Updated Guidance
    • Background
    • 2007 Transitional Relief for Return Preparer Penalties
    • Notice 2008-13, 2008-3 IRB 282, Interim Rules
    • Supplemental Guidance to Notice 2008-13
  • Proposed Regulation Changes Related to Preparer Penalties
    • Electronic Filing
    • Responsibility
    • Disclosure
  • Disclosure of Tax Return Information by Preparers and Consent
    • Penalties
    • Preparer
    • Information
    • Use and Disclosure
    • Consent
    • Permitted Disclosures Without Consent
    • Disclosure to Other Preparers and Contractors
    • Provision of Consent
    • Consent or Disclosure for the Form 1040 Series
  • Form Disclosure for §6662(d) and §6694(a) — Years Beginning by December 31, 2007
    • Background
    • New Guidance
  • Contingent Fee Guidance
  • IRS Commissioner's Term
  • Authority to Disclose Return Information for Certain Veterans Programs Permanent — Heroes Act §108
    • Background
    • Authority to Disclose to Veterans Affairs Permanent
  • Minimum Penalty for Failing to File — Heroes Act §303
    • Background
    • Amount Increased
  • DAT Transactions Are Listed Transactions
• Chapter 13 - Deferred Taxes and FIN 48
  • Introduction
  • SFAS 109
    • Objectives
    • Timing Differences
    • Scope
    • Deferred Tax Assets and Liabilities
    • Intraperiod Allocation
    • Disclosure
    • Recent Activity
  • FIN 48
    • Tax Positions
    • Recognition Standard
    • Disclosure
    • Other Areas of Note
    • Key Point
• Chapter 14 - Practice Aids
  • Tax Rate Schedules for 2008
    • Married Individuals Filing Joint Returns and Surviving Spouses
    • Heads of Households
    • Unmarried Individuals (Other Than Surviving Spouses and Heads of Households)
    • Married Individuals Filing Separate Returns
    • Estates and Trusts
    • Corporations
  • Circuit Court of Appeals by State/Territory
  • 2008 Mileage Rates
    • January 1 through June 30, 2008
    • July 1 through December 31, 2008
  • Maximum Auto Value Amounts
  • Auto Depreciation Limits — §280F
  • Lease Inclusion Amounts — §280F
• Chapter 15 - Ethics Focus: Taxation
  • Ethics Overview
  • Recent Developments
  • Spotlight on Independence in Tax Services
  • Key Ethical Dilemmas and Judgment Calls
  • Addressing Ethical Dilemmas
  • Available Resources
• Chapter 16 - Latest Developments

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