Refunds Owed to Veterans on Disability Severance Overpayments – By John R. Bullis

Kim Pilant John's Articles

IRS Information Release 2018-148 of July 11, 2018 advised certain (some) veterans who received disability severance payments after Jan. 17, 1991 about possible refunds. If the veteran paid tax (by mistake) on the payment, then a refund can be obtained by filing an Amended Return (form 1040X). Usually refunds for Amended Returns are only allowed for the recent three years. …

Cancellation of Debt is Taxable if Not Insolvent – By John R. Bullis

Kim Pilant John's Articles

Mr. and Mrs. Hamilton got student loans to finance the education of their adult son (Andrew). In 2008 Mr. Hamilton was permanently disabled due to a back injury. In June of 2011 he asked to have the loans discharged (cancelled). In 2011 two lenders did cancel loans totaling $158,511. In 2011 Mr. Hamilton had some “erratic spending behavior” so Mrs. …

Pastor Charged with Selling Worthless Bonds – By John R. Bullis

Kim Pilant John's Articles

Recently a federal grand jury gave a 13-count indictment accusing Rev. Kirbyjon H. Caldwell, age 64, and Gregory Alan Smith, age 55, of selling more than $1 million of worthless Chinese bonds. The grand jury indictment indicated the Chinese bonds were sold to 29 vulnerable and elderly investors. It alleged the two were guilty of wire fraud, money laundering and …

Health Savings Account – By John R. Bullis

Kim Pilant John's Articles

The Health Savings Accounts (HSAs) give great tax savings for folks under age 65. When you turn age 65 and are eligible for Medicare, you can not make contributions to your HSA. Whatever is in the account at age 65 is not lost. You can still use it to pay (or reimburse yourself if you paid) doctor, dentist, eye glasses …

What is Happening With the IRS? – By John R. Bullis

Kim Pilant John's Articles

IRS audit rate is relatively low. Individual returns had about one out of 167 returns audited. Most of those were done by mail with just one or two issues to be resolved. The audit rate for C corporations (regular corporations that pay their own tax) was about 1% in 2017 for C corporations that had assets of $5,000,000 or more. …

Document Non-Cash Charitable Contributions – By John R. Bullis

Kim Pilant John's Articles

Mr. and Mrs. Moore lived in Ohio and their individual income tax returns for 2013, 2014 and 2015 were selected for audit by IRS. The audit report showed the taxpayers failed to report cancellation of indebtedness income; failed to report wages; failed to report retirement income and failed to keep detailed records of the non-cash contributions. IRS also assessed a …

Son Defrauds Parents – By John R. Bullis

Kim Pilant John's Articles

Shirley and Roger Bailey owned Rig-Up Electrical Services, Inc in Arkansas. They were considering retirement in 2007 and left their son Jeffrey in charge of managing the company. In 2008 Jeffrey started a new company called Rig-Up Services, LLC and wanted to buy the assets of the parent’s company. Jeffrey hired Roy Johnson as the chief financial officer of the …