Tips for Effectively Using the IRC. Understand the Setup. Subtitles (A – I) Chapters (1 – 100) Subchapters (A - ?) Parts Subparts Sections Subsections. Subtitles. Subtitle A --Income Taxes [Chapters 1 – 6; Secs. 1-1563]
Tips for Effectively Using the IRC
Subtitles (A – I)
Chapters (1 – 100)
Subchapters (A - ?)
Subtitle A --Income Taxes [Chapters 1 – 6; Secs. 1-1563]
Subtitle B --Estate and Gift Taxes [Chapters 11 – 13; Secs. 2001-2704]
Subtitle C --Employment Taxes [Chapters 21 – 25; Secs. 3101-3510]
Subtitle D --Miscellaneous Excise Taxes [Chapters 39 – 47; Secs. 4001-5000]
Subtitle E --Alcohol, Tobacco, and Certain Other Excise Taxes [Chapters 54Secs. 5001-5891]
Subtitle F --Procedure and Administration [Chapters 61 – 80; Secs. 6001-7873]
Subtitle G --The Joint Committee on Taxation [Chapters 91 – 92; Secs. 8001-8023]
Subtitle H --Financing of Presidential Election Campaigns [Chapters 95 – 96; Secs. 9001-9042]
Subtitle I --Trust Fund Code [Chapter 98; Secs. 9500-9602]
Subtitle J --Coal Industry Health Benefits [Chapter 99; Secs. 9701-9722]
Subtitle K --Group Health Plan Requirements [Chapter 100; Secs. 9801-9833]
CHAPTER 1 --NORMAL TAXES AND SURTAXES [Secs. 1-1400L]
CHAPTER 2 --TAX ON SELF-EMPLOYMENT INCOME [Secs. 1401-1403]
CHAPTER 3 --WITHHOLDING OF TAX ON NONRESIDENT ALIENS AND FOREIGN CORPORATIONS [Secs. 1441-1464]
CHAPTER 6 --CONSOLIDATED RETURNS [Secs. 1501-1563]
163(h)(3)(B) ACQUISITION INDEBTEDNESS. --
WHAT IS THE REFERENCE? _________________________________
“For purposes of this part, the term “property” means money, securities, and any other property; except that such term does not include stock in the corporation making the distribution (or rights to acquire such stock).
“In applying this subsection, the term “property” includes services and the right to use property, but such term does not include money.”
(1) For disallowance of certain amounts paid in connection with insurance, endowment, or annuity contracts, see section 264 .
(2) For disallowance of deduction for interest relating to tax-exempt income, see section 265(a)(2) .
(3) For disallowance of deduction for carrying charges chargeable to capital account, see section 266 .
(4) For disallowance of interest with respect to transactions between related taxpayers, see section 267 .
(5) For treatment of redeemable ground rents and real property held subject to liabilities under redeemable ground rents, see section 1055 .
§23(a) Allowance of credit.
§357(a) General rule.Except as provided in subsections (b) and (c) , if—
(1) the taxpayer receives property which would be permitted to be received under section 351 or 361 without the recognition of gain if it were the sole consideration, and
(2) as part of the consideration, another party to the exchange assumes a liability of the taxpayer,
then such assumption shall not be treated as money or other property, and shall not prevent the exchange from being within the provisions of section 351 or 361 as the case may be.
Question – Who is the taxpayer?
Question – parents pay medical bills of $20K for son age 25 and they provide over ½ of his support. Son’s GI is $8000. Can parents deduct medical expense paid for son?
§213(a) Allowance of deduction.There shall be allowed as a deduction the expenses paid during the taxable year, not compensated for by insurance or otherwise, for medical care of the taxpayer, his spouse, or a dependent (as defined in section 152), to the extent that such expenses exceed 7.5 percent of adjusted gross income.
Answer – not a dependent?
What is answer to §213 question?
(A) 14 days, or
(B) 10 percent of the number of days during such year for which such unit is rented at a fair rental.
(1) Certain business use.Subsection (a) shall not apply to any item to the extent such item is allocable to a portion of the dwelling unit which is exclusively used on a regular basis—
(A) as the principal place of business for any trade or business of the taxpayer,
(B) as a place of business which is used by patients, clients, or customers in meeting or dealing with the taxpayer in the normal course of his trade or business, or
(C) in the case of a separate structure which is not attached to the dwelling unit, in connection with the taxpayer's trade or business.
In the case of an employee, the preceding sentence shall apply only if the exclusive use referred to in the preceding sentence is for the convenience of his employer. For purposes of subparagraph (A) , the term “principal place of business” includes a place of business which is used by the taxpayer for the administrative or management activities of any trade or business of the taxpayer if there is no other fixed location of such trade or business where the taxpayer conducts substantial administrative or management activities of such trade or business.
Reasons for Change
The Committee believes that the Supreme Court's decision in Soliman unfairly denies a home office deduction to a growing number of taxpayers who manage their business activities from their homes. Thus, the statutory modification adopted by the Committee will reduce the present-law bias in favor of taxpayers who manage their business activities from outside their home, thereby enabling more taxpayers to work efficiently at home, save commuting time and expenses, and spend additional time with their families. Moreover, the statutory modification is an appropriate response to the computer and information revolution, which has made it more practical for taxpayers to manage trade or business activities from a home office.