The last thing any retiree wants to encounter is a tax audit. Unfortunately, actions taken regarding a retirement account can bring you to the attention of the IRS. This is particularly true for retirees with significant incomes.
Virtual currency and bitcoins are popular subjects on tax blogs. As this involves online transactions, regulations regarding this area are relatively new. It is also a difficult area to regulate because individuals involved in bitcoin transactions are usually anonymous. Finally, the amount of virtual currency used in transactions usually is unreported by third parties. Yet unreported income from virtual currency transactions could possibly trigger an IRS audit.
The U.S. Treasury has long tried to prevent inversions and cross-border avoidance maneuvers. A tax inversion occurs when an American corporation relocates to a nation with lower tax rates while continuing extensive operations in our country.
The Internal Revenue Service recently announced an increase in the estate tax and gift tax exemptions for 2017. Currently the limit is $5.45 million over a person's lifetime, but the amount of this exemption will go up to $5.49 million in 2017. Married couples will be able to exclude up to $10.98 million before having to pay any tax. There is no change to the annual gift exclusion as this will remain at $14,000 per year. In other words, this allows for you to receive $14,000 in gifts each year without having to report this towards the lifetime gift tax exemption.
Gambling is more than just a form of entertainment or hobby; according to the IRS it is also considered a form of income. Since income must be reported for taxes, any winnings you receive from gambling must also be reported. These winnings can be anything from casinos, lotteries, horse races and raffles to cars, trips and other cash prizes.
Recent actions document IRS efforts to target offshore revenues. It appears that offshore voluntary compliance efforts now exceed more than $9.9 billion in collected taxes, penalties and interest since 2009.