Discussion:More Likely Than Not Standard
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Discussion Forum Index --> Advanced Tax Questions --> More Likely Than Not Standard
Discussion Forum Index --> Tax Questions --> More Likely Than Not Standard
| 5 October 2008 | |
| Thank Congress and Mr. Bush for eliminating this unworkable provision in Sec. 6694 (signed into law last night, but is retroactive). | |
| 5 October 2008 | |
| Yeah. Prop. Reg. 129243-07 will need some revising - I guess that is still the status of it. | |
| 5 October 2008 | |
| Thanks for pointing it out Riley2.
And you are correct. It was unworkable. Tom | |
| 5 October 2008 | |
| Riley2. Where can I find the lastest changes on sec. 6694 that you are refering to? thank you. | |
| 5 October 2008 | |
| "Where can I find the lastest changes on sec. 6694 that you are refering to?" | |
| 5 October 2008 | |
| If you would like to read it without going through the whole thing here it is:
SEC. 506. MODIFICATION OF PENALTY ON UNDERSTATEMENT OF TAXPAYER'S LIABILITY BY TAX RETURN PREPARER. (a) In General- Subsection (a) of section 6694 is amended to read as follows: `(a) Understatement Due to Unreasonable Positions- `(1) IN GENERAL- If a tax return preparer-- `(A) prepares any return or claim of refund with respect to which any part of an understatement of liability is due to a position described in paragraph (2), and `(B) knew (or reasonably should have known) of the position, such tax return preparer shall pay a penalty with respect to each such return or claim in an amount equal to the greater of $1,000 or 50 percent of the income derived (or to be derived) by the tax return preparer with respect to the return or claim. `(2) UNREASONABLE POSITION- `(A) IN GENERAL- Except as otherwise provided in this paragraph, a position is described in this paragraph unless there is or was substantial authority for the position. `(B) DISCLOSED POSITIONS- If the position was disclosed as provided in section 6662(d)(2)(B)(ii)(I) and is not a position to which subparagraph (C) applies, the position is described in this paragraph unless there is a reasonable basis for the position. `(C) TAX SHELTERS AND REPORTABLE TRANSACTIONS- If the position is with respect to a tax shelter (as defined in section 6662(d)(2)(C)(ii)) or a reportable transaction to which section 6662A applies, the position is described in this paragraph unless it is reasonable to believe that the position would more likely than not be sustained on its merits. `(3) REASONABLE CAUSE EXCEPTION- No penalty shall be imposed under this subsection if it is shown that there is reasonable cause for the understatement and the tax return preparer acted in good faith.'. (b) Effective Date- The amendment made by this section shall apply-- (1) in the case of a position other than a position described in subparagraph (C) of section 6694(a)(2) of the Internal Revenue Code of 1986 (as amended by this section), to returns prepared after May 25, 2007, and (2) in the case of a position described in such subparagraph (C), to returns prepared for taxable years ending after the date of the enactment of this Act. Now that's section 506 verbatim. If you really want to have some fun, peruse through all 169 pages and find all the tax extenders, AMT provisions and everything else that's in this monster. Have a bottle of aspirin handy. You are going to need it. Tom | |
| 6 October 2008 | |
| CCH has a nice 7-page summary of the Act. Follow this link:
http://tax.cchgroup.com/Legislation/2008-Emergency-Economic-Stabilization-Act.pdf updated link: http://www.cchgroup.com/opencms/opencms/web/TAA/PDFs/legislation/2008-Emergency-Economic-Stabilization-Act.pdf | |
