We're offering a number of opportunities for you to complete your ethics CPE requirements this year. Our first classes are April 26 and May 10, so sign up early. The classes will be structured as follows:
For more information or to register, click here.
We have a number of educational opportunities in 2016. We will be sending a detailed catalog to our subscribers very shortly. Until then, please mark your calendars for the following:
Summer Tax Webinars: Beginning May 19, but continuing throughout the summer, these one-hour webinars provide a great opporunity to receive low-key CPE credit on important topics during the more carefree summer months.
Ag Law Webinars: These two hour webinars, held June 7 and June 9 will cover farm lease law from start to finish and Iowa fence law, respectively.
2016 September Seminars: Navigating Changing Times: Offered September 8 and September 9, day one will address a number of practical, timely agricultural law issues. Day two will be an all-day farm tax seminar, allowing us to delve into detail on tax issues important to agriculture. More details on both days are coming soon!
Federal IncomeTax Schools: As always, we will be hosting our eight federal income tax schools throughout Iowa in the fall. We have some exciting changes coming to the schools and will post those details soon. In the meantime, please save the dates:
November 2-3: Maquoketa
November 7-8: Red Oak
November 9-10: Sheldon
November 14-15: Mason City
November 17-18: Ottumwa
November 21-22: Waterloo
December 5-6: Denison
December 12-13: Ames and Live Webinar
Yesterday, the Supreme Court of the United States heard oral arguments in a case that tests the authority of a federal agency to effectively restrict a property owner’s land use choices without an opportunity for judicial review. U.S. Army Corps v. Hawkes involves a jurisdictional determination from the United States Corps of Engineers (the Corps) that found that a landowner’s wetlands comprised “waters of the United States” subject to Clean Water Act jurisdiction. What difference did that make? For this landowner it was the difference between allowing the land to be used for a productive business or requiring the land to remain idle.
Under the Clean Water Act, a landowner cannot discharge dredged or fill material into “waters of the United States” without obtaining a permit from the Corps. These Section 404 permits are costly and time consuming. In fact, Justice Scalia once stated that the average applicant for an individual Corps permit “spends 788 days and $271,596 in completing the process." The permit, however, is necessary, to avoid substantial monetary penalties and perhaps jail sentences for dredging and filling a known “waters of the United States.” If a landowner knowingly conducts prohibited activity on wetlands meeting the arguably ambiguous definition of a “waters of the United States,” he could face penalties in excess of $75,000 per day. These fines and penalties are possible even if the landowner did not believe the wetland to be jurisdictional. At the very least, the Corps will issue a compliance order. The landowner could also give up his fight and cede his wetlands to a reserve program.
There is arguably a middle ground. Corps regulations allow a landowner to request a jurisdictional determination (JD) from the agency. Once such a determination is requested, the Corps offers its opinion as to whether a wetland (or other waterbody) is a “waters of the United States.” A JD is not required before a landowner can discharge dredged or fill material into a wetland. And, according to the Corps, if a landowner is later found to have violated the CWA, the prior existence of a JD does not expose the landowner to additional penalties. But in the face of a JD stating that a wetland is a “waters of the United States,” would any prudent landowner embark on a project in opposition to that determination, one that could subject him to huge fines and possible jail terms? That is a preamble to the question that has now come before our highest court.
Continue reading here.
For many Iowa taxpayers and practitioners, this tax season has generated more than its usual amount of angst. Some faced the possibility of Iowa tax bills exceeding their expectations by thousands of dollars. That is because it looked doubtful in the first months of 2016 that the Iowa Legislature would pass “coupling” legislation to sync Iowa tax law with federal tax provisions enacted by the Protecting Americans from Tax Hikes Act of 2015 (the Path Act). Without this coupling legislation, several key Iowa tax breaks would have ended or faced severe curtailment. On March 15, Iowa legislators ended this 2015 uncertainty, passing HF 2433. The Governor signed the bill into law on March 21. This coupling legislation, which reportedly will cost Iowa $97.6 million, retroactively integrates most Path Act changes into the Iowa tax law. The lone exception is 50% bonus depreciation which is specifically excluded from Iowa law.
In the Path Act, enacted December 18, 2015, Congress permanently extended a $500,000 enhanced IRC § 179 deduction with a $2,000,000 annual dollar threshold. Absent this extension, this deduction was limited to $25,000 with a $200,000 annual dollar threshold. The Path Act also provided 50% bonus depreciation that will be phased out over a five-year period and a permanent five-year (instead of 10-year) period during which S Corporations must recognize built-in gain. Additionally, the Path Act made permanent a number of other popular tax breaks, including a $250 above-the-line deduction for teachers who purchase supplies for their K-12 classrooms, the option to allow taxpayers to claim state and local sales tax instead of state and local income tax as an itemized deduction, and an option for taxpayers ages 70.5 and older to make tax-free distributions from their IRAs to a qualified charity. Continue reading here.
On March 10, the Iowa Utilities Board voted 3-0 to grant a hazardous liquid pipeline permit to Dakota Access, LLC under Iowa Code § 479B. The Board determined that the project would “promote the public necessity and convenience” as is required by the law.
Dakota Access filed its petition seeking the permit in January of 2015. They wish to build a 346-mile crude oil pipeline (30 inches in diameter) across Iowa. The pipeline would carry oil from the Bakken oil fields in North Dakota to a refining station in Illinois. Iowa was the last impacted state to approve the pipeline.
In the March 10 order order, the Board also vested Dakota Access with eminent domain authority over the parcels in the pipeline’s path for which voluntary easements could not be acquired. In seeking voluntary easements, Dakota Access must offer the holdout landowners the same price, terms, and conditions as they were offered before today’s order. Continue reading here.
As you know, our work at the Center is dependent on the fees generated by seminar registrations and gifts. If you would like to donate to further the Center's efforts, please contact our Program Administrator, Tiffany Kayser at email@example.com or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
As you're hard at work to get through the 2016 filing season, let us remind you that TaxPlace (our subscription service) has a helpful library of tax resources to assist you in your business. Here's what's new this month:
We work to keep you up to date on the latest court cases, laws, and issues important to you. Here are our latest updates:
Question: I have a client who cash rents his ground to a tenant. The tenant passed away on March 3. Do I have to honor the lease with his heirs or can I find a new tenant?
Answer: The Iowa Supreme Court answered this question in 1970 and it remains the law in Iowa. If a tenant dies after the statutory termination notice period passes (September 1), the right to farm the land the following crop year vests in the personal representative of the deceased tenant. The Court ruled that a cash rent lease is not a personal services contract that dies with the tenant. The case is Read v. Estate of Mincks, 176 N.W.2d 192 (Iowa 1970).
CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.