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I’m guessing that you—like me—are staring down a calendar filled with year-end obligations. There are work parties, personal and family commitments (we always go see It’s A Wonderful Life together as a family in the theater), and year-end deadlines to meet.
If you thought that you might get a break—and that things might slow down in the tax world as we approach the end of the year—I have some news for you. Actually, a lot of news. Let’s jump in.
First, after I reminded readers last week about the impending deadline to file beneficial ownership information (BOI) filings, a court ruling threw us a curve. Now, the Corporate Transparency Act (CTA)—the law requires reporting companies to report information to the U.S. government about who ultimately owns and controls them—is dead (at least for now).
The decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al. from the U.S. District Court for the Eastern District of Texas resulted in a preliminary injunction (☆) that blocks the U.S. Department of Treasury from enforcing the CTA’s reporting requirements. Because the National Federation of Independent Business (NFIB), and its nearly 300,000 members were a party to this case, the judge blocked enforcement of the BOI reporting requirements nationwide.
The ruling should mean that no businesses are obligated to comply with the reporting requirements. An appeal from the government was expected—and it has happened (☆).
In response to the ruling, the question on the minds of many was, “What now?” FinCEN posted a statement on its website that while it believes the law to be constitutional, it will comply with the most recent court ruling. That means, the agency says, that “reporting companies are not currently required to file their beneficial ownership information with FinCEN and will not be subject to liability if they fail to do so while the preliminary injunction remains in effect.” The agency added that “reporting companies may continue to voluntarily submit beneficial ownership information reports.”
There are now CTA cases pending in the Fourth, Fifth, Ninth, and Eleventh Circuits—it’s looking more like it could end up at the Supreme Court. At the very least, it’s important for advisors and small businesses to have a conversation about next steps.
That wasn’t the only thing that shook up the tax world this week.
President-elect Donald Trump announced he is tapping former Congressman Billy Long as the next Commissioner of the IRS (☆) even though current IRS Commissioner Danny Werfel is serving a term that would normally run until late in 2027. It’s the first time in 26 years that an IRS Commissioner was replaced without cause during their term.
Long does not have any formal training in tax, law, or accounting, does not have a college degree and never served in Congress on a tax writing committee. (He dropped out of the University of Missouri.)
Trump touted Long’s work “as a business and tax advisor, helping small businesses navigate the complexities of complying with the IRS Rules and Regulations” in his nod on Truth Social. However, shortly after the nomination, Senate Finance Committee Chair Ron Wyden (D-Ore.) released a statement on Long, saying in part, “What’s most concerning is that Mr. Long left office and jumped into the scam-plagued industry involving the Employee Retention Tax Credit. These ERTC mills that have popped up over the last few years are essentially fraud on an industrial scale, conning small businesses and ripping off American taxpayers to the tune of billions of dollars.” Long will need to be confirmed by the Senate.
The Senate will have more work to do. Much of the Tax Cuts and Jobs Act will expire at the end of next year. Not renewing it—indeed, not strengthening the bill with more tax cuts—will seriously damage the economy, says Steve Forbes.
But it may not happen quickly. Trump’s tax agenda may hinge on two critical and related issues: tariffs and the extent to which Congress pays for income tax cuts. And both could be subject to intense behind-the-scenes battles. (You can read my earlier take (☆) on reconciliation here.)
Before we get to 2025—however fast it feels like we’re hurtling towards it—there’s still 2024 to contend with. You’ll likely see a slew of articles advising you how to cut your tax bill. Not all of them will work for you. Why? Selling a depreciated stock might make your college tax credit go up. Sticking with pretax retirement contributions over the aftertax (Roth) kind might damage the 20% pass-through deduction for the self-employed. A Roth conversion could easily make your dividend taxes go up. Any of these things can produce weird effects on your foreign tax credit. That’s all thanks to the convoluted ways in which different tax rules are connected.
One of the ways to reduce your taxes at year-end that’s pretty tried and true—assuming you itemize—is charitable giving. Giving to U.S. charities was up, overall by the dollars, in 2023, according to an annual report from Giving USA, with individuals, bequests, foundations, and corporations hitting an estimated $557.16 billion. That reflects an overall boost in dollars, but adjusted for inflation, giving actually declined by 2.1%. The increase in dollars resulted from the growth of the stock market and gross domestic product (GDP), as both performed better than many economists expected in 2023.
(You can see visual representations—yes, charts—of the data in the report in last week’s Tax Breaks.)
One easy way to incorporate charitable giving into your routine is through your workplace. (☆) Using a giving platform empowers workers to pick their own charitable causes—usually with an employer match. The dominant player in the giving platform space is Alberta, Calgary-based fintech Benevity, which in 2023 processed $3.2 billion of donations to 265,000 unique causes from workers at such companies as Adobe, Cisco, Merck, Microsoft, Nike, UPS, and Visa. In an analysis for Forbes of all employee giving at 826 client companies during the two years ended October 31, 2024, Benevity found the top five recipients were the Red Cross (across all countries and chapters), St. Jude Children’s Research Hospital, Doctors Without Borders (across all countries), Planned Parenthood Federation of America and the Palestine Children’s Relief Fund.
Another way to make a dent in your taxes is to maximize your retirement savings. The new limits for 2025 are already out–but those won’t apply until the next tax year. If you need a refresher on the 2024 limits, you’ll find them here.
Looking for more ways to save on taxes? Have a conversation now with your tax advisor–and look out for more tips in future editions of the newsletter. Tis the season!
Enjoy your weekend,
Kelly Phillips Erb (Senior Writer, Tax)
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Questions
This week, a reader asks:
I saw your article about donating your organs. (☆) I get money for donating plasma. Do I have to report it on my tax return?
Yes, any money you get from donating plasma is reportable.
Plasma is the liquid portion of blood. About 55% of our blood is plasma—the remaining 45% are red blood cells, white blood cells, and platelets suspended in the plasma.
According to the Red Cross, plasma is commonly given to trauma, burn, and shock patients, as well as people with severe liver disease or multiple clotting factor deficiencies. It helps boost the patient’s blood volume, which can prevent shock and help with blood clotting. Pharmaceutical companies use plasma to treat conditions such as immune deficiencies and bleeding disorders.
In a plasma-only donation, the liquid portion of the donor’s blood is separated from the cells. Blood is drawn from one arm and sent through a high-tech machine that collects the plasma. The donor’s red blood cells and platelets are then returned to the donor with some saline.
You can donate your plasma for free at centers like Red Cross donation centers, but you can also sell plasma at a for-profit plasma center, typically run by pharmaceutical companies, to be used for research and testing. And it’s big business: The global plasma fractionation market size was estimated to be $35.8 billion in 2024 and is projected to grow to $58.2 billion by 2030.
That’s why companies are willing to pay for your plasma—you can typically earn $30 to $200 per donation.
You should receive Form 1099-MISC from a plasma donation center if you earn more than $600 from the center in one year. If you don’t hit that number, you may not receive Form 1099-MISC, but you are still required to report your income.
You’ll report your income from plasma donation on your tax return on Schedule 1, line 8(z)—that’s “Other income.” Any money you receive from plasma donation is taxed as ordinary income.
Don’t forget to keep excellent records!
Statistics, Charts, and Maps (Oh My!)
IRS Commissioner Daniel Werfel has been leading the agency since March 2023. During this time, the IRS has gotten new funding from the Inflation Reduction Act and seen portions of that funding clawed back. (For context, IRS’s expenditures were just over $16.1 billion for overall operations in fiscal year 2023.)
The IRS brings in the majority of revenue for the federal government. So, Werfel says, if the tax system falters, we are not bringing in the resources necessary to fund national defense, safe skies, safe food, and safe air.
To keep the IRS running well, Werfel says that the agency needs funding. “A well-functioning IRS where we’re answering the phone calls quickly, getting refunds out quickly, answering questions in our walk-in centers, having appointments available for anyone who needs one, putting more and more solutions on smartphones and tablets so people don’t have to call us if they don’t want, they could do it all digitally, that is all about reducing stress and serving taxpayers, and all of that requires adequate funding.”
You can hear more from Werfel on the latest episode of Tax Talk. The transcript is here.
A Deeper Dive
Roger Ver, an early Bitcoin investor renowned as “Bitcoin Jesus” for his evangelism of cryptocurrency since 2011, has found himself in a legal maelstrom. Ver, a controversial figure in the blockchain world, was arrested in April 2024 in Spain on U.S. criminal charges stemming from allegations of mail fraud, tax evasion, and filing false tax returns.
The indictment, originally filed in February 2024 but unsealed in May, has now been challenged by Ver and reignited discussions about the U.S. expatriation tax regime. Ver’s case also serves as a reminder that with criminal tax matters, the U.S. government has certain helpful provisions in the tax law that can extend the statute of limitations.
Tax Filings And Deadlines
📅 February 3, 2025. Due date for individuals and businesses affected by Hurricanes Beryl and Debby (more info here (☆) and here (☆)), those in South Dakota affected by severe storms, straight-line winds and flooding that began on June 16, 2024, taxpayers in Puerto Rico affected by Tropical Storm Ernesto, and those individuals and businesses in Connecticut and New York affected by severe storms and flooding from torrential rainfalls that began on August 18, 2024.
📅 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.
📅 September 30, 2025. Due date for individuals and businesses impacted by recent terrorist attacks in Israel.
Tax Conferences And Events
📅 December 16-17, 2024. NYU 43rd Institute on State and Local Taxation, Westin New York at Times Square, New York, NY. CLE and CPE available. Registration required, virtual option available.
📅 December 18, 2024 at 3:30 p.m. EST. National Association of Enrolled Agents (NAEA) PAC event with guests Rep. Gwen Moore (D-WI) and Rep. David Kustoff (R-TN), who are members of the House Ways and Means Committee and serve on the Tax Subcommittee. Learn about plans for the new 119th Congress, tax reform, priorities on the Ways & Means Committee, and more. Free to NAEA members, Registration required.
📅 February 19-25, 2025. ABA Tax Section 2025 Midyear Tax Meeting. JW Marriott Los Angeles L.A. Registration required.
📅 July 21-23, 2025. National Association of Tax Professionals Taxposium 2025, Caesars Palace, Las Vegas. Registration required.
Trivia
The Commissioner is not the only presidential appointee at the IRS. What other IRS position is appointed by the president?
(A) Chief, IRS Criminal Investigation
(B) Chief Counsel, IRS
(C) National Taxpayer Advocate
(D) Director, IRS Office of Professional Responsibility
Find the answer at the bottom of this newsletter.
Positions And Guidance
The IRS has published Internal Revenue Bulletins 2024-49 and 2024-50.
The IRS has published an updated draft of Form 1099-DA (Digital Asset Proceeds From Broker Transactions).
Noteworthy
Charles Rettig, a shareholder in Chamberlain Hrdlicka’s tax controversy and litigation practice and former IRS commissioner, wrote an Op-Ed on IRS funding.
Cherry Bekaert announced it has acquired substantially all the assets of DeBlanc, Murphy & Murphy, LLC, a firm specializing in accounting, tax and advisory services. As is typical for firms that operate in alternative practice structures, the transaction consists of two acquisitions: Cherry Bekaert Advisors LLC acquired DeBlanc, Murphy & Murphy, LLC’s nonattest assets while Cherry Bekaert LLP will acquire DeBlanc, Murphy & Murphy, LLC’s attest assets.
IRIS Software Group (IRIS), a global provider of accountancy, education management, HR, and payroll solutions, announced a definitive agreement to acquire Dext Software Ltd (Dext), a bookkeeping automation platform provider. The acquisition will unite two cloud-based platforms—Dext’s Bookkeeping Automation Platform and IRIS Elements—to deliver a complementary and fully integrated, end-to-end solution for accountants, bookkeepers, and businesses.
CBIZ, Inc., a national professional services advisor, announced that Brad Lakhia will become its next Senior Vice President and Chief Financial Officer (CFO), succeeding Ware H. Grove, who plans to retire after a successful 24-year tenure in the role. As part of a planned transition, Lakhia will assume the CFO role and join the CBIZ senior team on March 17, 2025.
The Financial Crimes Enforcement Network (FinCEN) is seeking nominations for membership in the Bank Secrecy Act Advisory Group (BSAAG). BSAAG membership is open to financial institutions subject to the Bank Secrecy Act (BSA), trade groups with members subject to the BSA, and federal and non-federal regulators and law enforcement agencies located within the U.S. Membership is granted to organizations, not to individuals. Organizational members will be selected to serve a three-year term.
The Public Company Accounting Oversight Board (PCAOB) released a report on audit firm culture, and offered considerations for firms looking to improve audit quality.
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In Case You Missed It
Here’s what readers clicked through most often last week:
You can find the entire newsletter here.
Trivia Answer
The answer is (B) Chief Counsel, IRS. The IRS Commissioner and Chief Counsel are the only presidential appointees in the agency.
The Chief of IRS Criminal Investigation (currently Guy Ficco (☆)) is appointed by the IRS Commissioner, the National Taxpayer Advocate (currently Erin Collins (☆)) is appointed by the Secretary of the Treasury, and the Director of the IRS Office of Professional Responsibility (currently Sharyn Fisk) is appointed by the Attorney General.
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