A SIMPLE (Savings Incentive Match Plan for Employees of Small Employers) IRA is a retirement savings plan designed specifically for small employers. A SIMPLE IRA is an IRA-based plan with ease of use features intended to encourage small employers, which may otherwise not offer a retirement plan, to create a retirement plan.

The dependency exemption is a valuable deduction that may be lost in many situations simply because some basic rules for qualification are not followed. Classifying someone as a dependent can also entitle you to other significant deductions or credits. Here is a rundown of some of the rules and their implications.

The IRS has issued new regulations that address when S Corp shareholders may increase their adjusted basis because of "indebtedness" of the S corp to them. The shareholder may increase the adjusted basis only if the indebtedness is bona fide. The new rules that elaborate on this basis principle are intended to

As summer arrives in Washington, so does the usual slowdown in legislative activity and 2012 appears to be no exception. Lawmakers have a full plate of tax-related bills on their agenda but progress is slow at best as both parties prepare for the November elections.

The Tax Court recently ruled on a case that should prove a cautionary example for taxpayers making charitable contributions. A married couple's deduction for charitable contributions of $25,171 to their church was disallowed because the written acknowledgment they received from their church did not meet the substantiation requirements under Code Sec. 170. The written acknowledgment had not included a statement regarding whether services were provided to taxpayers as consideration for their contribution.

Brokers as defined by Code Sec. 6045 are subject to certain reporting requirements that have been expanded incrementally over the past three years. The IRS has delayed the latest expansion, which on January 1, 2013 would have required brokers to report the cost basis of debt instruments and options to the IRS.

The Tax Court has rejected a taxpayer's attempt to deduct interest paid on her $1.1 million of indebtedness on her home. The plain language of the Tax Code limited her deduction to $550,000 because she elected to file her return as married filing separately. It did not matter that her husband did not take any mortgage interest deduction, that she paid all the interest, or that she owned the house jointly with her father-in-law who lived elsewhere.

A U.S. person with financial interests in or signature authority over foreign financial accounts generally must file Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR) if, at any point during the calendar year, the aggregate value of the accounts exceeds $10,000. The FBAR form is due by June 30 of the calendar year following the calendar year being reported. Thus, FBARs for 2011 are due by June 30, 2012. An FBAR is not considered filed until it is received by the Treasury Department in Detroit, MI.

IRS Commissioner Douglas Shulman unveiled his "real-time" tax system idea late in 2011. Since then, the IRS has had public meetings with stakeholders, including representatives of taxpayers, government officials, tax professional associations, and many others, to discuss moving the IRS away from its traditional "look-back" system to a "real-time" system. As explained by Shulman, the goal of a real-time system is to resolve problems with a taxpayer's return before it is processed rather than wait until after it is processed.

Education tax incentives are often underutilized because the rules are so complex. Some of the incentives are tax credits; other deductions. There are also savings plans for education costs. Making things even more complicated is the on-again, off-again nature of the education tax incentives. Under current law (as of June 2012), several taxpayer-friendly features of the incentives are scheduled to expire.