Another taxpayer found out well after filing his return with less than stellar results from his trading activities that there had been an option to file an election under §475(f) to use mark to market accounting which also converts the transactions from short term capital gain/loss to ordinary gain/loss.  Since the taxpayer had over $90,000 in net losses.

The materials can be downloaded at http://www.edzollars.com/2008-09-29_LateElection.pdf .

The podcast is sponsored by Leimberg Information Services, located on the web at http://www.leimbergservices.com .

This is a "travel" podcast of sorts this week--the materials were prepared on a Southwest Airlines 737 flying from Phoenix to Baltimore, and recorded in the Hotel Roanoke in Roanoke, Virginia.  This week's topic doesn't deal with any of that--rather it deals with the issue of a CPA that got "creative" in planning with himself and his clients, and in his case he finds the Tax Court isn't amused.  The case is Baisden v. Commissioner, TC Memo 2008-215 where a CPA attempted to get around the self-employment tax by paying "royalties" from his sole proprietorship to himself.  The case doesn't deal with that issue (he had conceded that matter by then) but rather deals with whether he was subject to the fraud penalty.

The materials are available for download at http://www.edzollars.com/2008-09-22_Fraud.pdf .

The podcast is sponsored by Leimberg Information Services at http://www.leimbergservices.com .

We look this week at a difference in application of IRC §162(k) between the Ninth Circuit Court of Appeals and the United States Tax Court given the Tax Court's decision in Ralston Purina v. Commissioner, 131 TC No. 4 that dealt with the taxpayer's attempt to claim a deduction for dividends paid to participants in its ESOP when it had to redeem certain stock from the ESOP to pay out terminated participants in that plan.

The materials can be downloaded from http://www.edzollars.com/2008-09-15_ESOP.pdf .

The podcast is sponsored by Leimberg Information Services, located on the web at http://www.leimbergservices.com .

The Ninth Circuit Court of Appeals this week affirmed the Tax Court's decision in the case of Johanson and Melzig v. Commissioner, TC Memo 2006-105 involving alimony.  In its original decision, the Tax Court expressed exasperation at having to yet again decide an issue the parties could have resolved in the decree itself-whether the payments would cease on the death of the recipient spouse as required by §71(b) for the payments to be treated as alimony.  Yet again, the recipient claimed the payments would not and the payor claimed they would, and the Tax Court had to then divine how a California state court would have ruled under California law.

The materials can be found at http://www.edzollars.com/2008-09-08_Alimony.pdf .

The podcast is sponsored by Leimberg Information Services, located on the web at http://www.leimbergservices.com .

Accounting issues we often run into involve the differences between tax and GAAP treatment of items, and this week we look at one such case involving the time for recognizing an expense.  In this case, the matter involved rebates and we look at a Chief Counsel Memorandum (ILM 200834019) outlining the IRS's view on why the taxpayer in this case could not recognize the expense related to rebates at the time a sale was made. 

Materials for this week's podcast can be downloaded at http://www.edzollars.com/2008-09-01_Rebates.pdf .

The podcast is sponsored by Leimberg Information Services, located on the web at http://www.leimbergservices.com .