Anyone who buys tangible personal property from out-of-state and brings it into South Carolina is responsible for paying a use tax of 6% on the sales price of the property, plus any local tax rate addition. Individuals may report purchases subject to use tax on their individual income tax return (SC 1040, Line 26). The Department of Revenue publishes a worksheet, UT-3W, which can be used to determine the purchases subject to use tax and the amount of use tax due. An individual who does not report use tax purchases on his or her income tax return should file Form UT-3, Use Tax Payment Return. ...
On June 11, 2013 the "South Carolina Abandoned Buildings Revitalization Act" was signed into law by the Governor. The Act provides new incentives for the rehabilitation, renovation, and redevelopment of abandoned buildings in South Carolina. Taxpayers meeting the requirements of the Act can receive a tax credit equal to 25% of the cost of rehabilitating property against either (1) state income taxes and corporate license fees, or (2) property taxes.
In order to qualify for the credit a taxpayer must rehabilitate an abandoned building for commercial use. A building with an ...
A federal district court has ruled that the members of an accounting firm were each personally liable for the trust fund portion of the unpaid federal employment taxes of their client.
Buddy Light Accounting & Tax Services provided accounting and payroll services to their client, GC Affordable Dining, Inc., which included managing payroll and accounts payable, making federal tax deposits, issuing payroll checks to employees, and preparation of federal employment tax returns (Form 941) for the client. When the client began experiencing financial difficulties, it failed to make ...
In what can only be considered a "game-changer" for South Carolina property owners, the South Carolina Court of Appeals in Taylor v. Aiken County Assessor, ___ S.E.2d ___, 2013 WL 1223185 (S.C. Ct. App., March 27, 2013) has recently ruled that a current owner of property can "look back" and challenge the county assessed value of real estate not owned in the prior year.
For over half a century, tax practitioners in South Carolina have assumed, without much comment, that South Carolina law imposed responsibility to pay current property taxes on the owner of property as of December 31st of ...
The IRS has long been aware of U.S. taxpayers living overseas who have not filed federal income tax returns or Reports of Foreign Bank and Financial Accounts ("FBARs"). Earlier this year, the IRS announced the reopening of its successful Offshore Voluntary Disclosure Program ("OVDP") allowing individuals with unreported foreign bank account income to come forward and report this income, and to pay the related tax, interest and certain reduced civil penalties, but without criminal prosecution. The IRS has now announced a new alternative compliance procedure designed to provide ...
The Court of Appeals for the First Circuit, in Kaufman v. Shulman, Docket No. 11-2017P-01A (1st Cir., July 19, 2012), reversed a Tax Court decision siding with the IRS which had disallowed a couple's conservation easement deduction. The Tax Court had disallowed the deduction because a provision in a subordination agreement with the couple's lender violated the Treasury Regulations' "extinguishment provision". The Court of Appeals reversed the Tax Court, finding that the Tax Court and IRS interpretation of this regulation was unreasonably restrictive and inconsistent with ...
Landowners may be allowed a federal income tax deduction for the contribution of a conservation easement restricting donated property. A qualified conservation contribution is a donation of a qualified real property interest to a qualified organization which is exclusively used for conservation purposes. The conservation easement must also be protected and the restrictions on the use of the property must be granted in perpetuity. The contribution must be made to governmental units, churches, schools, hospitals, or Section 501(c)(3) public charities and supporting ...
On May 31, 2012 the Fourth Circuit Court of Appeals issued its opinion in the case of Starnes v. Commissioner, upholding a decision of the United States Tax Court which determined that the former shareholders of a corporation were not liable as transferees for unpaid corporate income taxes. The opinion is the first appellate level decision addressing the proper legal standard to be applied in order to determine if a person is liable as a transferee under § 6901 of the Internal Revenue Code.
The Starnes case involved what the IRS characterizes as an "intermediary transaction tax ...
The Eighth Circuit Court of Appeals, in the recent case of Watson, P.C. v. US, 109 AFTR 2d 2012-1059, 668 F. 3d 1008 affirming the district court below, held that an S-corporation shareholder's 2002 and 2003 reported salaries were unreasonably low, and reclassified dividends paid by the corporation to the shareholder as additional salary, thus subjecting that income to additional employment taxation under the Federal Insurance Contribution Act (FICA).
Generally, earnings from self-employment and employee wages are subject to withholding for Social Security and Medicare ...
Many individuals and business entities create charitable organizations to serve the needs of a specific group of persons or a specific community with a need for a type of service. Most charitable organizations undertake the arduous task of applying for tax-exempt status with the Internal Revenue Service in order to be exempt from paying corporate income taxes and to solicit charitable donations from public and private patrons. In June of 2011, the IRS revoked the tax-exempt status of approximately 275,000 organizations because these organizations failed to file the required ...