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Archive for January, 2009

Tapping into retirement accounts for business funding

Posted by taxguru on January 24, 2009

I was reading my paper copy of Practical Accountant magazine the other day and noticed this small item in the Tax Briefing section.

ROBS Retirement Plans Targeted

An IRS memorandum has been issued containing audit guidelines for a version of a qualified plan being marketed as a means for prospective business owners to access accumulated tax-deferred retirement funds without paying applicable distribution taxes in order to cover new business start-up costs. The memorandum refers to these arrangements as ROBS (rollovers as business startups).

IRS indicates that they “may serve solely to enable one individual’s exchange of tax-deferred assets for currently available funds, by using a qualified plan and its investment in employer stock as a medium. This may avoid distribution taxes otherwise assessable on this exchange. Although a variety of business activity has been examined, an attribute common to this design is the assignment of newly created enterprise stock into a qualified plan as consideration for these transferred funds, the valuation of which may be questionable.”

This obviously has to do with the kind of plans that that I have discussed on numerous occasions, such as those offered by companies like BeneTrends. I haven’t seen any response to this yet from BeneTrends or any of the similar companies; but I’m hoping their plans will withstand any IRS scrutiny that may come their way because they are a huge help to small business owners, as well as a more productive investment vehicle for the retirement funds than the big stock market or other conventional vehicles.   

 

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Posted by taxguru on January 24, 2009

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Posted by taxguru on January 22, 2009

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A cause near and dear to Willie Nelson’s heart…

Posted by taxguru on January 22, 2009

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A Change in attitude we can Hope for…

Posted by taxguru on January 22, 2009


(Click on image for full size)

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Posted by taxguru on January 21, 2009

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Posted by taxguru on January 21, 2009

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New IRS Filing Addresses

Posted by taxguru on January 21, 2009

In their annual shuffling of service center workload, IRS has just announced that taxpayers in four states have to send their 1040s to different service centers than previously.

Delaware, New York and Rhode Island now mail to Kansas City

Illinois taxpayers send their 1040s to Fresno

I checked the filing addresses in the latest copy of TheTaxBook and they actually already had the new ones in there.

For those of us who use tax prep software, that means we need to over-ride the default filing addresses in the programs for earlier tax years for those clients in those four states. The 2008 programs should be updated by the software automatically.

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Posted by taxguru on January 20, 2009

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Posted by taxguru on January 20, 2009

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