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Yahoo
6 days ago
- Business
- Yahoo
How sports betting taxes work and what you might owe
Sports betting only became legal in the United States in 2018 after the U.S. Supreme Court struck down a 1992 federal ban and ruled that states could individually determine what forms of gambling were legal within their boundaries. This opened the floodgates for various state legislatures to decide whether to allow sports betting. Currently, 40 states and the District of Columbia authorize the practice, and 34 permit online sports betting, according to the American Gaming Association. This has tax implications for millions of gamblers — who are also taxpayers. There is no ambiguity here, according to tax experts. 'Broadly, winnings from sports betting are taxable income,' said April Walker, senior manager for Tax Practice and Ethics with the American Institute of CPAs. Sports betting winnings are taxed under the Internal Revenue Service's designation for gambling income and losses. If your winnings total $600 or more and are at least 300 times the amount wagered, then a payer, such as a casino, is required to issue you a Form W-2G. While supplying the form is the responsibility of the payer, Walker noted, you are still liable for reporting and ensuring taxes are paid on those sports betting winnings, whether or not you receive the form. If you're dealing with a mobile sports gambling provider, like DraftKings or FanDuel, the reporting standards are a little different, according to New England-based accounting firm Baker Newman Noyes. If you reach net earnings above $600 or 300 times your original wager, you can also receive a Form 1099-MISC from an online sports wagering organization that will report your net earnings from the previous tax year. Net earnings would be calculated as your cash winnings minus any cash entry fees and adding any cash bonuses received from the platform. Individual tax filers must report total gambling income as 'Other income: gambling' on line 8b of Schedule 1, 1040. The only exception is if you are filing as a professional gambler, meaning someone 'engaged in sports betting primarily for profit rather than only as a hobby,' per the Journal of Financial Planning. In this case, the filer would use Form 1040, Schedule C to report profit or loss from a business, and they would note winnings as revenue and be able to deduct their losses directly. Self-employed filers — in this case, professional gamblers — must pay self-employment tax, which is 15.3 percent, half of which is subject to deduction, for Social Security and Medicare. This embedded content is not available in your region. To answer the tax rate question, we must work backward. Taxpayers whose winnings exceed $5,000 and 300 times the amount wagered will automatically have 24% of their total payout withheld by the payer, according to Walker. This rate could be higher in states that have additional income tax, in which case the 24% federal rate would be withheld on top of the state's personal income tax rate. Still, when it comes time to file your income taxes, this withholding doesn't ensure you've paid the required amount of tax. Rates range from 10% to 37%, depending on your total income, so based on what tax bracket you end up in at the end of the tax year, you'll either get a refund or have to pay out a higher amount from your winnings. Read more: How tax withholding works Perhaps the most pivotal — and confusing — part of understanding how to report gambling income on your federal income tax return is factoring in your losses. The correct method, according to Walker, comes down to what the IRS refers to as 'sessions.' This philosophy comes from a 2015 IRS notice on slot machine play, indicating that total wins and losses need to be calculated by the day they were made. Each day counts as an individual session, so rather than net your total losses against your total winnings, you will need to calculate the end amount of each session, or day, and determine which days were a loss and which days ended with winnings. Still, the only way that losses can be offset against gambling winnings is if you itemize your deductions rather than take the standard deduction, which is $15,000 for single tax filers on 2025 taxes. Using the session method, you could add your total losses on Schedule A, line 16 as gambling losses. Whether you can itemize your deductions to offset your winnings when it comes to state income tax depends on which state you're filing in. Nine states, including North Carolina, Connecticut, and Rhode Island, do not allow itemized deductions for gambling losses, per an article in the Journal of Financial Planning. Even professional gamblers can only offset their total winnings with their losses and get to zero. There is no tax refund for losses that exceed the total amount of winnings, Walker said. To minimize sports betting taxes, the key is having a demonstrable record of all of your wagers, where and when they occurred, proof that they occurred (like receipts and tickets), and evidence of your total amount of winnings and losses. This will be particularly useful if you find yourself audited by a tax authority. 'Gambling has been around for quite a while, and so the rules on that have not changed,' Walker said. 'The difference is that there might be more people who are doing it on a regular, daily basis, and I would encourage them to understand how important it is to do their bookkeeping so they are not having to scramble after the fact and if they are able to itemize, and take advantage of all of their losses.'
Yahoo
26-05-2025
- Business
- Yahoo
Schedule E: How to use this tax form to report rental income and losses
If you own rental property, you'll need to file a Schedule E tax form with the IRS to report rental income income or losses. Schedule E is filed along with your Form 1040 individual income tax return. While having rental income and losses is a common reason for filing a Schedule E — and what we'll focus on here — you'll also need to complete this form for other sources of supplemental income, including from royalties, partnerships, S corporations, estates, trusts and residual interests in real estate mortgage investment conduits (REMICs). Schedule E is a tax form that individual taxpayers must file to the IRS along with their Form 1040. Taxpayers need to complete a Schedule E to report supplemental income and losses, including from rental real estate and other sources. Schedule E is one of several different types of tax forms that taxpayers may need to complete to calculate different types of income, credits and deductions. Schedules provide additional information beyond what's included on Form 1040. Learn more: Current tax brackets and federal income tax rates Taxpayers who own rental real estate must file Schedule E to report any income or loss generated from their property. On this tax form, you'll detail all of the income and expenses for each of your rental properties. But Schedule E is only applicable to individual taxpayers, not people who are in the business of renting property (those taxpayers must instead file Schedule C — more on this below). While rental real estate is a common reason why taxpayers have to file Schedule E, there are other income situations also captured on this form: royalties, partnerships, S corporations, estates, trusts and residual interests in REMICs. If you file your taxes electronically with tax preparation software, you'll be prompted to fill out Schedule E based on your answers to questions about sources of income. However, if you still file taxes by paper, there isn't a specific prompt related to Schedule E on Form 1040. The closest mention of Schedule E on the 1040 is line 8, which instructs taxpayers to enter 'additional income' from Schedule 1. Schedule 1 is where income from Schedule E is entered, as well as income from other forms and schedules, and then that income flows to line 8 of the 1040. Whether you need to file Schedule E or Schedule C depends on whether you're renting out property as a business or as a supplementary source of income. When to file Schedule E: If you're renting out part of your home or other property that you own, and it's a passive source of income, then you should file Schedule E. When to file Schedule C: If you rent out property as a business, such as short-term vacation rentals, then you should file Schedule C if you're actively involved in providing services to tenants. For more information, check out the IRS instructions regarding rental income and expenses. Need an advisor? Need expert guidance when it comes to managing your investments? Bankrate's AdvisorMatch can connect you to a CFP® professional to help you achieve your financial goals. Schedule E is a two-page form that is split into five parts, including sections applicable to four specific sources of income and a summary section. You only need to complete the parts relevant to your income situation. If you own rental real estate, you will need a variety of details about your rental property handy, including information about your various expenses. This is the applicable section for taxpayers who have rental real estate, though it also covers income or loss from royalties. To complete this section, you will need to provide several basic details about the property, including: The physical address of each applicable property The type of property The number of rental days and days used for personal use Income, and specifically rents received Expenses, including insurance, management fees, utilities, taxes, and more If you are completing this section for income or losses related to royalties, you will need to provide information about royalties received and any applicable expenses. To complete Part I, you will sum the total income or loss from rental real estate and royalties and, if no other parts of Schedule E are applicable to you, you can enter this total on line 5 of Schedule 1. This section needs to be completed by taxpayers who are a member of a business partnership or a shareholder of an S corporation. You will need several basic details to complete Part II of Schedule E, including: The name of the entity The employer identification number (EIN) of the partnership or S corporation A breakdown of whether the relevant income and loss was passive or non-passive, which refers to whether you materially participated in the business To complete Part II, you'll need to refer to Schedule K-1, the form you receive from organizations in which you have a financial interest. If you have a passive loss, you will also need to complete Form 8582, and if you have a Section 179 deduction, you will need to complete Form 4562. You need to complete Part III if you're a beneficiary of a trust or an estate and have an income or loss to report. To complete Part II, you will need the following information: The name of the estate or trust The EIN A breakdown of whether the relevant income or loss was passive or nonpassive As with Part II, you will need to refer to the Schedule K-1 that you received, if applicable, and will need to complete Form 8582 if you have a passive loss. You will need to complete Schedule E's Part IV if you're an investor in a real estate mortgage investment conduit, or REMIC, which is a structure for pooling mortgages. To complete this information, you will need to refer to the Schedules Q that you received from the REMIC, along with: The name of the REMIC The EIN Information from Schedules Q, including excess inclusion, taxable income or net loss, and income If you completed more than one section on Schedule E, then in Part V you will total the income or loss from these various sources. You then enter that total on line 5 of Schedule 1. See this IRS page for more details on how to fill out Schedule E. 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Globe and Mail
08-05-2025
- General
- Globe and Mail
Welcome home, snowbirds – but don't forget your U.S. tax filings
My parents just returned from their winter home in Arizona. They've made lots of friends down there. Friends my mother can share her innermost secrets with. It's not that they've become really close – it's just that they're all old enough that they can't remember anything she's said to them. Now that my parents are back, I reminded them of the rules around U.S. tax filings. Many Canadian snowbirds are surprised to find out that spending time down south can make them subject to U.S. taxes on their worldwide income – if they're not careful. Here's a primer on the rules. The test The U.S. levies taxes on its citizens but also on non-citizens if they reside in the U.S. for a certain amount of time. There's a test, called the 'substantial presence test' (SPT), that could cause you to face taxes in the U.S. The SPT adds up three numbers: (1) your days spent in the U.S. in the current year, (2) one-third of the days spent in the U.S. in the preceding year and (3) one-sixth of the days in the U.S. in the year before that. If the total is 183 or more, you'll meet the SPT (although you'll automatically avoid meeting it if you spent less than 31 days in the U.S. in the current year). If you do meet the SPT, the Internal Revenue Service will consider you to be a resident of the U.S. for tax purposes unless you take some additional steps. Being a U.S. resident for tax purposes may require you to file a full-blown U.S. tax return (Form 1040). It's not only painful paperwork; it means splitting your tax dollars between the U.S. and Canada every year (you won't save tax overall, but you'll have to file in both countries). As for the average snowbird? Many will be caught meeting the SPT. If you spend, on average, 122 days (about four months) or more in the U.S. each year, you'll meet the SPT after three years. What should you do if that happens? You may be able to maintain your tax status as a non-resident of the U.S. and avoid having to file a tax return there, but that will require filing a special form. The form Filing U.S. Form 8840, Closer Connection Exception Statement, essentially tells the IRS that, notwithstanding the fact you meet the SPT, you have a closer connection to Canada as your permanent home and should not be considered a resident of the U.S. for tax purposes. To be eligible to file Form 8840, you must have spent fewer than 183 days (about six months) in the U.S. in the current year. If you spend 183 days or more in the U.S. in any year, you may then need to rely on the Canada-U.S. tax treaty's tiebreaker rules to avoid facing taxes in the U.S.– but this gets complicated (you'll need to file U.S. Form 8833 and may need legal help). Form 8840 is due by June 15 each year for the prior calendar year's filing. If you meet the SPT for 2024, the deadline is extended to June 16, since June 15 is a Sunday this year. Some Canadians may be required to file a U.S. non-resident tax return (Form 1040-NR) if they earned certain types of U.S. income (rental income or income for work performed in the U.S., for example). If you have to file Form 1040-NR, then your Form 8840 is due with that tax return (generally by June 15 each year, but this deadline can be extended to Oct. 15). Speak to a tax pro about Form 1040-NR. If you fail to file Form 8840 on time, or if you meet the SPT but don't meet the other conditions to file Form 8840 (see below), you could become subject to U.S. tax on your worldwide income or face a penalty for not filing the appropriate statements with the IRS. The nuances You won't be eligible to file Form 8840 if you spent 183 days or more in the U.S. in a particular tax year – as I mentioned – or if you're a green card holder or have applied for a green card. Also, you've got to count a partial day in the U.S. as a full day. In some limited cases, you can ignore certain days spent in the U.S. – if you're unable to leave the country owing to a medical condition, if you're in the U.S. for less than 24 hours while in transit to another country or in certain other cases for students, teachers, trainees, foreign government officials or commuters. Tim Cestnick, FCPA, FCA, CPA(IL), CFP, TEP, is an author and co-founder and CEO of Our Family Office Inc. He can be reached at tim@
Time of India
27-04-2025
- Business
- Time of India
How food gifts are making paying taxes a little tastier
Thermal printing of receipts is now common in restaurants. The machines require no ink cartridges, are easy to use and portable. The only problem is for customers when, months later, they want to claim bills as expenses for tax purposes and find the printing has faded. Heating with hair dryers is said to resurrect legibility, but this is unsure and annoying to do when you're already frazzled with tax filing. #Pahalgam Terrorist Attack India stares at a 'water bomb' threat as it freezes Indus Treaty India readies short, mid & long-term Indus River plans Shehbaz Sharif calls India's stand "worn-out narrative" April 15 is the usual deadline for filing individual tax returns in the USA and food outlets sweeten the stress by offering generous deals. Shake Shack, for example, gave an extra burger for every purchase over $10.40, since tax returns are filed using Form 1040. At Krispy Kreme, anyone buying a dozen doughnuts could get a second dozen for just the cost of the sales tax. India's tax preparation season is just starting, so maybe food outlets here could consider similar deals. Taxation and food have an intimate history. In earlier times, actual food products were tithed to the authorities. The need to have these survive for storage was one of the factors driving technologies of food processing and preservation, like making milk into cheese and creating barrels for long-term storage. In Mark Lawrence Schrad's Vodka Politics , he explains how distilling became an easy way to concentrate the value of grains, which the Russian state then controlled through vodka taxes. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Villas For Sale in Dubai Might Surprise You Dubai villas | search ads Get Deals Undo For centuries, Japan was governed through the kokudaka system, where the value of land for taxation purposes was assessed by the weight (a koku was around five bushels) of rice it could produce. The real problems with food taxes arise in times of scarcity when the price rises due to taxes become intolerable to consumers. Smart governments would then reduce food taxes, yet they are such attractive sources of revenue that this often doesn't happen, leading to riots or, as with India's salt tax, potent political protests. Japan provides an example of how food and taxes can be linked in a positive way. As in all developed countries, there has been a massive move away from villages to cities which, coupled with declining population rates, leaves fewer people in rural areas to farm or fish — or pay taxes to support local administration. An easy solution is for the central government to pour money into rural projects, but these suffer from lack of real connections with local people and their needs. Japan's authorities also knew that many people still felt a strong connection with their villages, even when they were no longer there. Which is why, in 2007, Yoshihide Suga, then a minister, and later prime minister, announced the furusato nozei , or hometown tax scheme, under which taxpayers could get tax rebates by sending part of their income to a rural area. It was envisaged that people would choose their hometowns, but anyone could send it anywhere. Crucially, the money went to a specific place, not a general fund. To foster this direct connection, people from that place could send gifts, mostly of local food, to their benefactors. This was the element that really helped the scheme take off. Local food producers, who often had surplus food, were happy to give it away — this actually helped revive declining rural occupations. Websites came up showing where people could send their tax money and the delicious food they would get in return, like premium sake from Niigata, seafood from Hokkaido, tea from Shizuoka or honey from Kumamoto. This has become a rare example of a popular tax scheme, with revenues crossing one trillion yen in 2024. This success has caused criticisms, not least from urban areas losing revenue, but it also validates the theory of tax choice. This argues that people should get some say in where their money is used, and if they do, will then pay taxes more willingly. Furusato nozei 's food gifts give the benefits of tax choice tangible, and delicious, form.
Forbes
19-04-2025
- Business
- Forbes
Tax Breaks: The Millions Breathe A Sigh Of Relief After Tax Day Edition
Millions of taxpayers breathed a sign of relief this week. getty That sound you heard earlier this week? It was the sound of millions of taxpayers and tax professionals breathing a sigh of relief now that Tax Day is over. April 15 is Tax Day for most of the country—some exceptions apply—but that hasn't always been the case. The U.S. income tax system has changed quite a bit over the years, and that includes more than the due date for Form 1040. What we know as the modern income tax system began in 1913 after a four-year push to get enough states to ratify the Sixteenth Amendment. By law, a proposed amendment becomes part of the Constitution once it is ratified by three-fourths of the States. At the time, 36 states were required (38 of 50 states would be needed today). On February 3, 1913, Delaware became the 36th state to ratify the Sixteenth Amendment. Eventually, 42 of the 48 states would ratify the amendment (Alaska and Hawaii weren't yet states, Florida and Pennsylvania refused to consider it, and Connecticut, Rhode Island, Utah, and Virginia voted no). The first filing deadline was March 1, 1913. The deadline would change twice before Congress settled on April 15 in 1955 to give taxpayers and the IRS more time to prepare and process increasingly complex returns. Statistically, most taxpayers have used a tax professional so far this season. Those taxpayers who self-prepared had a variety of options, including Direct File. That won't be the case next year. The Trump administration is planning to eliminate the IRS Direct File program. While Republican lawmakers had previously opposed the program, the free tax software program had been marked as safe for the 2025 season, with now Treasury Secretary Scott Bessent committing to the program during his confirmation hearing. "I will commit that for this tax season … Direct File will be operative," Bessent said. However, less than 48 hours after the end of the regular tax filing season, word circulated that the program would be axed. Amanda Renteria, who serves as Chief Executive Officer for Code for America, a civic tech nonprofit, called it "a dark day for Americans who want a simple, free option to file their taxes electronically directly with the government." "The decision to kill Direct File comes at a critical moment," she says, "when faith in public institutions is already at historic lows. This isn't just a step backward for tax administration—it's a betrayal of public trust at precisely the time government should be demonstrating its ability to deliver basic services effectively." No matter how you filed your taxes this season, you need to keep great records–but for how long? Some taxpayers like to hang on to every piece of tax-related paper, from receipts to returns, forever. Others do just the opposite: they shred and purge immediately. When it comes to tax records, which is better? For tax purposes, you need to find a middle ground. And that middle ground is more precise than somewhere between "forever" and "immediately." While it's true that you want to keep essential records, don't be afraid to toss out what you don't need. The general rule is that you should hold onto your tax returns and the supporting documentation until the three-year statute of limitations–the time the government has for challenging your return–runs out. Supporting documentation for your tax returns includes not only your forms W-2 and 1099 but also credit card and other receipts, invoices, mileage logs, copies of checks, proofs of payment, and any other records that support income, deductions, credits, or tax breaks you reported or claimed on your return. Of course, exceptions apply (the government gets longer to go after you for fraud and failure to file, for example)–and there may be non-tax-related reasons to hold onto records. Find out what works for you and follow through. With Tax Day mostly in the rearview mirror, you are likely looking forward to a break this weekend. My family was planning to celebrate with an Easter egg hunt (yes, my kids are older, but they are all super competitive and would never turn down free candy), but my mom took a tumble, so our gathering will be a bit smaller than anticipated. There will, however, still be candy. I hope you're planning something similarly relaxing(ish). Speaking of candy, don't skip out on this look at whether Mega Marshmallows, described as 'oversized, fluffy marshmallows,' should be classified as edible confectioneries, thereby subject to the standard U.K. VAT rate of 20 percent, or classified as a culinary ingredient that qualifies for VAT exemption. The case is HM Revenue & Customs v. Innovative Bites Limited, but you may have heard of Innovative Bites by a different moniker: the great British marshmallow decision of 2025. Enjoy your weekend, and don't eat too many sweets, Kelly Phillips Erb (Senior Writer, Tax) Articles marked with (☆) are premium content and require you to log-in with your Forbes membership credentials. Not a subscriber yet? Click here to sign up. Paying off your tax debt with an installment agreement can relieve some anxiety. getty This week, a taxpayer asked: I recently got into a car accident and received some money from the insurance company. I have put the $11,000 in my savings account. I'm on a payment plan to pay off back taxes. Can the IRS take the money from my savings to pay off my debt? One of the ways the IRS ensures it gets paid is through a levy. A levy is a legal seizure of your property. It's often confused with a lien, but they are very different. A lien is filed against you to act as security—for example, an IRS lien will prevent you from selling a significant asset like your home and taking the proceeds without paying the IRS. In comparison, a levy is the actual taking of your property to satisfy your tax obligations. A levy is never a first step. The IRS gives you the opportunity to resolve your debt through a lump sum payment, an installment plan, or another arrangement. Here's where you get some good news. Typically, so long as you are making regular payments on an installment agreement, the IRS won't levy your assets or garnish your wages. However, it's important to make your payments as scheduled, file your tax returns on time, and otherwise comply with the terms of your installment agreement. If you default, all bets are off, and the IRS can resume collection activities, including levies (seizing your assets). Note, however, that your tax refund could still be seized and applied to your outstanding balance. That said, even with a payment plan, the IRS may choose to keep a federal tax lien in place. The IRS will release the lien once you pay the debt. For certain types of taxes, the IRS will withdraw the lien if you enter into a direct debit installment agreement and meet certain other conditions. — Do you have a tax question or matter that you think we should cover in the next newsletter? We'd love to help if we can. Check out our guidelines and submit a question here. IRS numbers from the 11th week of the tax filing season—the week ending April 11, 2025—confirm that tax filings lag behind the numbers from last year. That isn't likely to turn around. With just a few days before the end of the filing season, the number of tax returns received dipped again, a trend that hasn't changed since the season opened on January 27, 2025. In January, the IRS noted that it expects more than 140 million individual tax returns for tax year 2024 to be filed by the April 15, 2025, federal deadline. The IRS received 117,588,000 individual income tax returns as of April 11, 2025, compared to 116,295,000 as of April 12, 2024. The dip is 1.7%, with nearly two million individual tax returns filed to date in 2025 as compared to 2024. (The data that includes the last day of the filing season, April 15, 2025, will be available on April 25, 2025. The IRS reports the filing data for each week based on the prior week's numbers.) Notably, web visits to continued to lag far behind last year's numbers. There have been 296,470,000 visits to the website as of April 11, 2025, compared to 533,981,000 visits by April 12, 2024. Tax season data for weeks ending April 12, 2024, and April 11, 2025 Kelly Phillips Erb Those numbers reflect a drop of about 45%, but you won't see that statistic on the IRS website. For most of the tax season, the percentage drop was calculated. A footnote on the website now reads, 'Changes were made from 2024 to 2025 in the analytics methodology used to evaluate the number of visits to Previously a session-based approach was used. In 2025, an event-based model is being used. As a result, comparison of data sets from year to year should not be made.' A session-based approach tracks users within a defined timeframe and includes metrics like page views, bounce rate, and traffic source. If you have a blog or website, this is akin to what you learn from a platform like Universal Analytics. In contrast, an event-based approach tracks the kinds of actions that a user takes, like clicks and form submissions. This is similar to what you'd learn using a platform like Google Analytics. I've suggested the dip could also be attributed to a slowdown in content on the website. It likely won't help that the chief information officer at the IRS will leave his position at the end of the month. Rajiv Uppal's departure follows several high-profile defections from the tax agency since the beginning of the year. Uppal's position was created as part of former IRS Commissioner Danny Werfel's plans for a new leadership structure at the agency, and his domain included the IRS information technology division, previously touted as a key area of focus for the agency. Failure to file an FBAR report can follow you... even to the grave. getty Family members often want to know what might happen if a spouse or parent dies with outstanding tax obligations. That can be a complicated question, but a recent decision out of the U.S. District Court for the Southern District of New York has made clear that FBAR penalties 'accrue' on the date the form is due (but fails to be filed) and not when the IRS assesses the penalties. The assessment could happen after the taxpayer has died, and the court found death does not end the obligations or render them excessive under the Eighth Amendment. The case revolves around David Benishai, a U.S. citizen who held financial interests in multiple bank accounts in Israel from 2004 to 2010. Benishai failed to timely file FBARs. Under the FBAR rules, each "US person" with an interest in, signature or other authority over, one or more bank, securities, or other financial accounts in any foreign country must file an FBAR if the aggregate value of such accounts at any point in a calendar year exceeds $10,000. In other words, if the total of your interests in all of the foreign accounts in which you have an interest reaches $10,000 or more at any point in the calendar year, you may need to file an FBAR. That applies even if you've been faithfully reporting the income on your federal income tax return and even if you've never, ever repatriated a single dollar to the U.S. It also applies even if the account produces no taxable income. Benishai didn't timely file his FBARs, but he did file delinquent FBARs and agreed to extend the statute of limitations for the IRS to assess penalties. He passed away a few months before the IRS finalized its assessment. Benishai's estate, administered by his wife, Hanna Hendler, challenged the assessment of 'nonwillful' penalties, which the IRS had assessed at $10,000 per report. The estate argued that the FBAR penalties could not be enforced after his death, that the statute of limitations had expired, and that they violated constitutional protections. The court found that FBAR penalties are primarily 'remedial,' which means they are designed to compensate the government for the costs of investigating non-compliance and enforce tax collection, not purely punitive and designed to punish the taxpayer. (This is consistent with the court's approach in Bittner, a Supreme Court case that held that the maximum penalty for the non-willful failure to file should be calculated per report, not per account.) When a penalty is remedial in nature, the penalty can survive the taxpayer's death. 📅 May 1, 2025. Due date for individuals and businesses in the entire states of Alabama, Georgia, North Carolina, and South Carolina and parts of Florida, Tennessee, and Virginia affected by severe storms and flooding from Hurricane Helene (☆) and Hurricane Milton. 📅 June 16, 2025. Due date for individuals living and working abroad to file their 2024 federal income tax return and pay any tax due. 📅 September 30, 2025. Due date for individuals and businesses impacted by recent terrorist attacks in Israel. 📅 October 15, 2025. Due date for individuals and businesses affected by wildfires and straight-line winds in southern California that began on January 7, 2025. 📅 November 3, 2025. Due date for individuals and businesses affected by storms in Arkansas and Tennessee that began on April 2, 2025. 📅 May 8-10, 2025. American Bar Association Section of Tax May Meeting. Marriott Marquis Washington, DC. Registration required. 📅 May 13-14, 2025. National Association of Enrolled Agents 2025 Capitol Hill Fly-In, Washington, DC. Registration required (NAEA members only). 📅 June 16-19, 2025. Latino Tax Fest. MGM Grand Hotel & Casino, Las Vegas, Nevada. Registration required. 📅 July 18-19, 2025. Tax Retreat 'Anti Conference'. Denver, Colorado. Registration TBA. 📅 July 21-23, 2025. National Association of Tax Professionals Taxposium 2025, Caesars Palace, Las Vegas, Nevada. Registration required. According to the IRS, the average taxpayer spends how many hours preparing their return? (A) 5 (B) 13 (C) 35 (D) 72 Find the answer at the bottom of this newsletter. The American Institute of CPAs (AICPA) has signaled its strong support for bipartisan legislation establishing the accounting profession as a career pathway through Science, Technology, Engineering, and Math (STEM). H.R. 2911, the Accounting STEM Pursuit Act, introduced by Representatives Young Kim (R-CA) and Haley Stevens (D-MI), would allow K-12 grant funding to be used for accounting education, with a focus on improving access for underrepresented students. The American Bar Association (ABA) Section of Taxation submitted comments in response to Executive Order 14178 titled 'Strengthening American Leadership in Digital Financial Technology' and Executive Order 14219 titled 'Ensuring Lawful Governance and Implementing the President's 'Department of Government Efficiency' Deregulatory Initiative.' These orders direct the Department of Treasury and other executive agencies to conduct a comprehensive review of substantive agency actions, including guidance documents, for guidance that 'affect[s] the digital asset sector,' 'imped[es] technological innovation,' or 'impose[s] undue burdens on small business and impede[s] private enterprise and entrepreneurship' and to suggest items that should be modified or rescinded. Greenberg Traurig, LLP, announced that Michelle Rosenblatt joined the Private Wealth Services Practice as a shareholder. Rosenblatt has experience in tax, estate, and wealth preservation planning. She focuses her practice on U.S. and international tax, estate, business, and wealth preservation planning for high-net-worth individuals, families, and family offices. William Fry announced that Cian O'Sullivan has joined the firm as a tax partner. O'Sullivan is a Chartered Tax Advisor and Chartered Accountant, managing corporate clients across various sectors and providing both domestic and international tax advice. VWV has announced that Rod Smith has joined the firm as the new head of the London Office Estates, Tax and Trusts team. Smith brings over 25 years of experience advising on high-value, complex, and multi-jurisdictional estates and trusts. The city of Venice (Italy) will charge day-trippers an arrivals tax for the second year, a measure to combat overtourism. Visitors who are not overnighting pay 5-10 euros (about $6-11 U.S.) to enter. Venice collected 2.4 million euros during a 2024 pilot program for the tax, but the costs for the new system totaled 2.7 million euros. This year, the city expects a surplus. Pedestrians in Seattle were startled to hear crosswalk signals broadcast a recording purporting to be Amazon founder Jeff Bezos criticizing local tax policies. One message reportedly said, "Hi, I'm Jeff Bezos, this crosswalk is sponsored by Amazon Prime with an important message. Please don't tax the rich. Otherwise, all the other billionaires will move to Florida too." The recordings, which appeared to be a form of political protest, targeted multiple intersections in Seattle's tech-heavy South Lake Union neighborhood and the University District. — If you have tax and accounting career or industry news, submit it for consideration here or email me directly. Here's what readers clicked through most often in the newsletter last week: You can find the entire newsletter here. The answer is (B) 13. It takes taxpayers about 13 hours, on average, to file their taxes. getty The estimated average time burden for all taxpayers filing a Form 1040 or 1040-SR is 13 hours, with an average out-of-pocket cost of $290 per return. This average includes all associated forms and schedules, and taxpayer activities like recordkeeping. Nonbusiness taxpayers have an average burden of about eight hours and an average cost of $160 per return, while business taxpayers have an average burden of about 24 hours and $620 per return. You are considered a 'business' filer if you file a Schedule C (self-employed and business owners), Schedule E (income from rental real estate, royalties, partnerships, S corporations, estates, trusts, and residual interests in real estate mortgage investment conduits (REMICs), Schedule F (farming income), or Form 2106 (Employee Business Expense) with your Form 1040. How did we do? We'd love your feedback. If you have a suggestion for making the newsletter better, submit it here or email me directly.
