Kevin Jerry

Who Needs to Follow the Tangible Property Regulations?

Let’s Explore How the Tangible Property Regulations Came to Be The IRS and Treasury began a project in 2004 to update and clarify regulations that determine capitalization or expensing expenditures on tangible property. The Internal Revenue Service and many taxpayers were in constant conflict and court battles over whether expenditures on tangible property (including building …

Who Needs to Follow the Tangible Property Regulations? Read More »

architecture, skyscraper, glass facades-2256489.jpg

Q&A on The Tangible Property Regulations

Questions from the Webinar on August 2, 2022 Why are the Regulations being ignored?The Tangible Property Regulations are extremely difficult to understand and even more challenging to implement. Our best guess is that the Regulations take at least 800 hours to learn. As a result, most Tax Professionals defer to the old and seemingly conservative …

Q&A on The Tangible Property Regulations Read More »

person calculating taxes

Deferral vs Deduction

Tax Deductions and Tax Deferrals A tax deduction is a permanent reduction in income that is taken before you calculate your net taxable income. For example, if you’re a business or building owner, tax deductions are items like electricity, water, phone bill, automobile expenses, salaries, light repairs (see §263(a) below), etc. The more tax deductions …

Deferral vs Deduction Read More »

Additional Consequences of Not Filling 3115s

Additional Consequences of Not Filing the Required Tangible Property Regulation 3115s Beyond the disregarded TPR method filing consequences, the client will miss out on the following optional TPR opportunities: The ability to deduct the net remaining tax basis of either prior partial asset or whole asset dispositions under a 196 and/or a 205/206 method filings. …

Additional Consequences of Not Filling 3115s Read More »

Consequences of Not Filing 3115

What are the issues or consequences to the taxpayer and the tax return preparer if a taxpayer does not comply with the new tangible property regulations (TPRs, §263(a) and file the required 3115(s)?  The short answer is: It puts the client at risk for significant adverse consequences. These consequences include but are not limited to the …

Consequences of Not Filing 3115 Read More »