The IRS issued guidance stating that most Massachusetts taxpayers who received a Chapter 62F refund in 2022 will not be required to pay a federal income tax on that refund. Certain qualifications apply. Please check with your CPA or tax advisor. LEARN MORE
Author Archives: grkbadmin
State Tax Refund/Rebate may be taxable on your federal income tax return
The IRS is studying the situation and is expected to issue guidance in the near-term. We recommend waiting for additional clarification from the IRS before filing your 2022 income tax returns. LEARN MORE
Massachusetts charitable contribution deduction allowed for taxable years beginning on or after January 1, 2023
The Massachusetts deduction for charitable contributions has been suspended since 2002 when it was tied to the return to the 5% state income tax. Implementation was again delayed due to the uncertainty relative to Covid19. READ MORE
IRS releases frequently asked questions about clean vehicles credits for new, previously owned and commercial clean vehicles
WASHINGTON — The Internal Revenue Service today released frequently asked questions (FAQs) about clean vehicle credits for new, previously owned and commercial clean vehicles in Fact Sheet (FS-2022-42)PDF.
The Inflation Reduction Act of 2022 (IRA) makes several changes to the new clean vehicle credit for qualified plug-in electric drive motor vehicles, including adding fuel cell vehicles. The IRA also added a new credit for previously owned and commercial clean vehicles.
These FAQs provide detail on how the IRA revises the new clean vehicle credit for individuals and businesses, and information on the previously owned clean vehicle credit for individuals, and the new credit for qualified commercial clean vehicles.
More information about reliance is available.
IRS issues 2021 Filing Season frequently asked questions
WASHINGTON — These frequently asked questions (FAQs) are released to the public in Fact Sheet 2022-06 PDF, January 31, 2022.
The American Rescue Plan Act (ARPA) of 2021 expanded the Child Tax Credit (CTC) for tax year 2021 only. These Child Tax Credit FAQs focus on information helpful to taxpayers preparing their tax year 2021 tax returns.
Recipients of advance Child Tax Credit payments will need to compare the amount of payments received during 2021 with the amount of the Child Tax Credit that can be claimed on their 2021 tax return.
Those that received less than the amount they are eligible for can claim a credit for the remaining amount. Those that received more than they are eligible for may need to repay some or all of the excess amount.
The IRS has sent Letter 6419 in January 2022 to provide the total amount of advance Child Tax Credit payments that were received in 2021. The IRS urges taxpayers receiving these letters to make sure they hold onto them to assist them in preparing their 2021 federal tax returns in 2022.
These FAQs contain the following topics:
- Topic A: 2021 Child Tax Credit Basics
- Topic B: Eligibility Rules for Claiming the 2021 Child Tax Credit on a 2021 Tax Return
- Topic C: Reconciling Advance Child Tax Credit Payments and Claiming the 2021 Child Tax Credit on Your 2021 Tax Return
- Topic D: Claiming the 2021 Child Tax Credit If You Don’t Normally File a Tax Return
- Topic E: Commonly Asked Immigration-Related Questions
More information about reliance is available.
Beware of “ghost” preparers who don’t sign tax returns
IR-2021-30, February 5, 2021
WASHINGTON — The Internal Revenue Service reminds taxpayers to avoid “ghost” tax return
preparers whose refusal to sign returns can cause a frightening array of problems. It is
important to file a valid, accurate tax return because the taxpayer is ultimately responsible for
Ghost preparers get their scary name because they don’t sign tax returns they prepare. Like a
ghost, they try to be invisible to the fact they’ve prepared the return and will print the return and
get the taxpayer to sign and mail it. For e-filed returns, the ghost preparer will prepare but
refuse to digitally sign it as the paid preparer.
By law, anyone who is paid to prepare or assists in preparing federal tax returns must have a
valid Preparer Tax Identification Number, or PTIN. Paid preparers must sign and include their
PTIN on the return. Not signing a return is a red flag that the paid preparer may be looking to
make a fast buck by promising a big refund or charging fees based on the size of the refund.
Unscrupulous tax return preparers may also:
• Require payment in cash only and not provide a receipt.
• Invent income to qualify their clients for tax credits.
• Claim fake deductions to boost the size of the refund.
• Direct refunds into their bank account, not the taxpayer’s account.
The IRS urges taxpayers to choose a tax return preparer wisely. The Choosing a Tax Professional
page on IRS.gov has information about tax preparer credentials and qualifications. The IRS
identify many preparers by type of credential or qualification.
No matter who prepares the return, the IRS urges taxpayers to review it carefully and ask
questions about anything not clear before signing. Taxpayers should verify both their routing
and bank account number on the completed tax return for any direct deposit refund. And
taxpayers should watch out for preparers putting their bank account information onto the
Directory of Federal Tax Return Preparers with Credentials and Select Qualifications
Beware of “ghost” preparers who don’t sign tax returns | Internal Revenue Service Page 1 of 2
Taxpayers can report preparer misconduct to the IRS using IRS Form 14157, Complaint: Tax
Return Preparer (PDF). If a taxpayer suspects a tax preparer filed or changed their tax return
without their consent, they should file Form 14157-A, Tax Return Preparer Fraud or Misconduct
Affidavit PDF .
IRS issues guidance relating to deferral of gains for investments in a Qualified Opportunity Fund
IR-2019-75, April 17, 2019
WASHINGTON –The Internal Revenue Service today issued guidance (PDF) providing additional details about investment in qualified opportunity zones.
The proposed regulations allow the deferral of all or part of a gain that is invested into a Qualified Opportunity Fund (QO Fund) that would otherwise be includible in income. The gain is deferred until the investment is sold or exchanged or Dec. 31, 2026, whichever is earlier. If the investment is held for at least 10 years, investors may be able to permanently exclude gain from the sale or exchange of an investment in a QO Fund.
Qualified opportunity zone business property is tangible property used in a trade or business of the QO Fund if the property was purchased after Dec. 31, 2017. The guidance permits tangible property acquired after Dec. 31, 2017, under a market rate lease to qualify as “qualified opportunity zone business property” if during substantially all of the holding period of the property, substantially all of the use of the property was in a qualified opportunity zone.
A key part of the newly released guidance clarifies the ”substantially all” requirements for the holding period and use of the tangible business property:
For use of the property, at least 70 percent of the property must be used in a qualified opportunity zone.
For the holding period of the property, tangible property must be qualified opportunity zone business property for at least 90 percent of the QO Fund’s or qualified opportunity zone business’s holding period.
The partnership or corporation must be a qualified opportunity zone business for at least 90 percent of the QO Fund’s holding period.
The guidance notes there are situations where deferred gains may become taxable if an investor transfers their interest in a QO Fund. For example, if the transfer is done by gift the deferred gain may become taxable. However, inheritance by a surviving spouse is not a taxable transfer, nor is a transfer, upon death, of an ownership interest in a QO Fund to an estate or a revocable trust that becomes irrevocable upon death.
The guidance (PDF) is posted on IRS.gov. These regulations relate to the Tax Cuts and Jobs Act (TCJA), the tax reform legislation enacted in December 2017.
For information about other TCJA provisions, visit IRS.gov/taxreform.
GRKB receives recognition at the BBB’s 2018 Central MA Awards for Marketplace Excellence
On Wednesday, November 14, 2018, The Better Business Bureau of Central New England hosted their annual Central MA Awards for Marketplace Excellence at the Manor in West Boylston. Greenberg, Rosenblatt, Kull & Bitsoli, P.C. (GRKB) Senior Vice President, Rick Powell, serves as Chairman of the Board of the Better Business Bureau. During the Awards program, GRKB was recognized with a President’s Club Award for celebrating 46 years of membership. GRKB employees Courtney Miller and Brendan Robertson attended the event and graciously accepted the award.
Pictured left to right: Nancy Cahalen, President and CEO of the BBB; Brendan Robertson, Courtney Miller, and Rick Powell from GRKB
In memory of Mary H. Sweet
Our thoughts and prayers are with the family and friends of our long-term employee and friend, Mary Sweet, who passed away October 26, 2018 at the age of 73. We’re grateful for all of the years spent together and memories made during the 31 years that Mary worked with GRKB.
Full Obituary for Mary can be found here:
Tax Reform Snapshot Highlights Some Changes for Our Clients
Changes in tax law are here and we want to help you navigate the landscape. Contact us soon for an appointment to identify tax planning strategies to capitalize on opportunities within the new law.