The AAA-CPA Weekly Update
Jan. 8, 2014

How a virtual receptionist service can help you start the year off right
How can a virtual receptionist service like Ruby help you start 2014 off right? Click here to find out! AAA-CPA members receive a 14 day free trial and enjoy a 10 percent discount off of their monthly service. Visit them online here or call 866-611-7829 today.

Federal tax update — December
By David S. De Jong, Esq., CPA, Stein Sperling
In Sharp v. Commissioner, TC Memo 2013-90, a university professor demoted to a secretarial position who was diagnosed thereafter with stress and depression and was compensated by the school had to report the full settlement as income. Alleged physical symptoms of muscle tension and migraines arose out of the emotional injuries, and the settlement agreement made no mention of the physical problems. Click here for the full article.

Meet the people who've already paid their 2014 Social Security tax
Los Angeles Times
Call them the 900: The Americans who will meet their 2014 payroll tax obligations for Social Security as of Jan. 2. They're an impressive group and very elite, bless their hearts: To have earned the maximum taxable wage for Social Security in 2014 ($117,000) in two days, one's annual income has to exceed about $21.3 million. More

2014 begins with $54 billion in tax hikes
The Washington Times
A final congressional stalemate in late December means the New Year's expiration of a host of tax breaks, amounting to a $54.2 billion increase for green-energy businesses, teachers, homeowners, college students and others. Businesses will take the biggest hit, with the disappearance of a valuable research tax credit, subsidies for building wind turbines and incentives to make energy efficiency improvements to buildings. More

Tax court ruling clarifies IRA transactions
Accounting Today
A recent ruling by the U.S. Tax Court holds a costly reminder about the consequences of making inappropriate transactions within a client's individual retirement account. In a case that centered on two investors' relationship to a company held by their retirement accounts, the court ruled that two business partners' IRAs were disqualified under the prohibited transaction rules when they guaranteed loans to a company owned by their IRAs.More

White House offers 'grand bargain' on tax cuts and infrastructure
NBC News
Gene Sperling, the director of President Barack Obama's National Economic Council, said that Obama is offering congressional Republicans "a grand bargain on jobs. He has said he would be willing to do corporate tax reform that lowers rates to 28 percent and simplifies taxes for small businesses, but do it together with a major infrastructure investment."More

End of mortgage-fix break could mean big tax bills
A tax break for struggling mortgage borrowers ends Jan. 1 and that could mean big tax bills — and financial hits for their neighbors. Say a family is behind on their mortgage and the bank cuts them a deal, maybe reducing the loan principal or forgiving the mortgage balance after a "short sale" in which the seller owes more than the final price. Under traditional Internal Revenue Service rules, the amount of that debt forgiveness would be taxable income.More

How some high-income people avoid paying federal income tax
From Sept. 11: Most of the 43 percent of Americans who the Tax Policy Center projects will pay no federal income tax this year make very little money. Some are middle-income households that qualify for enough tax preferences to zero out their tax bills. But more than 70,000 households with income over $200,000 will pay no federal income tax in 2013. How will they do that?More

Bringing international tax rules into the 21st century
The Huffington Post
It's a watershed moment for international tax policy. The debate over tax evasion by the wealthy and tax avoidance by multinational corporations has never before grabbed so many headlines or caused so much anger. More

Airlines gain ally in bid to shield fees from US taxes
The airline industry and one of its prominent allies are gearing up to fight a possible push in the U.S. Congress to tax baggage fees and other air-travel charges as a way to generate additional federal revenue. Airlines in recent years have relied on the so-called ancillary fees, such as those paid by passengers for checked baggage and reservation changes, to help bolster their bottom line.More

5 tax trends to watch in 2014
With congressional elections coming in November, ongoing controversy over the Affordable Care Act and policy exhaustion on the part of both Congress and the White House, don't expect dramatic changes in tax policy in 2014. But there will still be some important issues on the table — not all of them in Washington, D.C.More