Can you image losing a tax case with the IRS and owing a billion dollars?
Who did this? We are talking about Dow Chemical Company ("Dow"). They lost in the District Court for the Middle District of Louisiana. I suppose they have no choice but to appeal. It is a billion dollars, after all.
What got them in this mess?
A couple of tax shelters, one marketed by Goldman Sachs and both implemented by the law firm of King & Spalding. The IRS sued for tax years 1993 to 2003.
It is called the "premium assistance tax credit," and it refers to the subsidy that people will receive under the ObamaCare individual mandate. It will begin in 2014, and it is supposed to make insurance more affordable for people under 400% of the federal poverty line (FPL). I am not really sure how the politicians came up with 400%, as many if not most of us would agree that 4 times the poverty line is nowhere near poverty. For example, if you are married and have a child, 400% of the FPL is $78,120. That picks up a lot, if not the majority, of people in the Cincinnati area.
I think I have been insulted.
I am reading this morning that the Court of Appeals for the D.C. Circuit is hearing the IRS appeal of the Loving decision. That decision concerned the recent effort by the IRS to regulate tax preparers, and the IRS lost the case. There were three parts to the IRS effort:
I recently visited one of our clients. He owns a restaurant/bar. That is a tough business under the best of circumstances. It is a business where almost all your profit comes from paying attention to the nickels and dimes.
Is there anything new out there, he asked?
We talked about the IRS' recent interest in employee tips and gratuities. What is the difference?
ObamaCare has been coming up a lot. I am curious how many CPAs are less-than-humored to have been corralled into activities better left to insurance agents and social workers.
What are we recommending to our clients? Let's talk about one strategy.
Let's say that a company offers health insurance. They spend, on average, $8,700 annually per employee. The company is fearing if not already facing rate shock. What to do?