Be prepared for a disaster. With Hurricane Dorian approaching the East Coast of the United States, it’s a good time to make sure to create or update an emergency preparedness plan. The IRS reminds taxpayers to secure and duplicate essential documents, create lists of property and know where to find information if a disaster occurs. Keep important documents in waterproof containers in a secure space. Take photos of home and business contents for insurance or tax benefits. Record the value of high-value items. For more tips from the IRS, visit https://bit.ly/2ZInEnL.
If an individual files a “frivolous” tax return, the IRS can assess a $5,000 penalty. In one case, a taxpayer submitted a frivolous tax return, and when the IRS requested a corrected return, she submitted a photocopy of the original amended return six times. The IRS assessed seven $5,000 penalties against the taxpayer for the original return and the photocopies. The U.S. Tax Court ruled that only one penalty should apply (Kestin, 153 TC No. 2). What’s considered a frivolous return? The IRS defines it here: https://bit.ly/2Ln4K0e
The IRS has provided the domestic asset/liability percentages and domestic investment yields needed by foreign insurance companies to compute their minimum effectively connected net investment income. For the first tax year beginning after Dec. 31, 2017, the relevant domestic asset/liability percentages are 118.3% for foreign life insurance companies and 201.2% for foreign property and liability insurance companies. For the same time period, the relevant domestic investment yields are 4.5% for foreign life insurance companies and 3.5% for foreign property and liability insurance companies.