CT Tax Planning Firm

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New College Saving Opportunity: Converting 529 Plans to Roth IRAs

Saving for your children’s college education became much easier when 529 plans were introduced. The ability to access funds in a 529 plan without paying federal taxes, as long as the funds were used to cover qualified education expenses, make them appealing to parents of college-bound children. However, some found it difficult to determine how …

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IRS Announces Penalty Relief for 2020 and 2021 Tax Returns and Plans to Resume Collection Notices

The Internal Revenue Service (IRS) has recently announced a significant update for taxpayers, providing much-needed relief for those affected by the COVID-19 pandemic. Specifically, the IRS is offering automatic penalty relief for taxpayers who failed to pay their income taxes for the tax years 2020 and 2021. This relief is part of the IRS’s efforts …

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Navigating New IRS Regulations: Understanding De Minimis Error Safe Harbors

The IRS has recently finalized regulations that provide clarity and relief for businesses and individuals regarding the penalties for inaccuracies in information returns and payee statements. These final regulations, effective for documents required on or after January 1, 2024, solidify the IRS’s stance on de minimis error safe harbors under Code Sections 6721 and 6722, …

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IRS’s Aggressive Compliance Measures Bring in Over $500 Million from Millionaires

In a recent update that underscores the effectiveness of heightened compliance activities, the Internal Revenue Service (IRS) has made a significant impact on tax collection from high-net-worth individuals. Commissioner Daniel Werfel reported that, thanks to increased scrutiny on millionaires suspected of tax evasion, the IRS has successfully collected $482 million thus far. This announcement came …

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What the 2024 IRS Focus Guide Means for Taxpayers in Disputes

The IRS Independent Office of Appeals has recently unveiled its 2024 Focus Guide, which could bring significant changes for anyone currently in a tax dispute or who might find themselves in one in the future. This guide, designed to align with the IRS’s Strategic Operating Plan, aims to enhance taxpayer services and provide a fair …

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Understanding the Supreme Court Case on Taxing Unrealized Income

Recently, the Supreme Court of the United States took up a significant case, Charles G. Moore v. United States, that could impact how certain incomes are taxed. This is especially pertinent for those with investments in foreign companies. What’s the Case About? The case revolves around a change in the tax law from the 2017 …

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Important Update on 2024 Standard Mileage Rates and Deductions

The IRS has released its 2024 standard mileage rates for taxpayers who use their vehicles for business, medical, charitable purposes, and certain moving expenses. Understanding these changes is vital for optimizing your tax deductions in the upcoming year. 2024 Standard Mileage Rates Overview The IRS set the following standard mileage rates for 2024: Business Use: …

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2024 Inflation Adjustments for Pension Plans & Retirement Accounts Released

The 2024 cost-of-living adjustments (COLAs) that affect pension plan dollar limitations and other retirement-related provisions have been released by the IRS. In general, many of the pension plan limitations will change for 2023 because the increase in the cost-of-living index due to inflation met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged. The SECURE 2.0 Act made some …

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IRS Notice on Form 1099-K Reporting for 2023 Explained

The IRS has recently pulled back on its change requiring third-party settlement organizations (TPSOs) to report transactions exceeding $600 in 2023 rather than its current limit of transactions more than $20,000. Basically, for 2023, the IRS is giving these organizations more time to adapt to new 1099-K reporting rules introduced by the American Rescue Plan …

IRS Notice on Form 1099-K Reporting for 2023 Explained Read More »

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Required Minimum Distributions Rule Changes

The SECURE 2.0 Act of 2022 included some changes that are about to impact required minimum distribution (RMD) requirements. To explain the changes and reduce taxpayer confusion, below we explain the changes in the RMDs for certain retirement plans and individual retirement accounts (IRAs) included in IRS Notice 2023-54. What Changed? Change in RMD Age: …

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