July 2018
Registration is Underway for our Annual September Seminars!
We hope you'll join us for our annual September Seminars September 20-21, 2018, at the Quality Inn & Suites in Ames, and online. Day One is our Agricultural Law Seminar, cosponsored with Iowa Farm Bureau and the Agricultural Law Section of the Iowa Bar. Day Two is our Farm Tax Workshop devoted to updating those who prepare tax returns or assist with business planning for farm clients on the latest agriculture-specific information regarding tax reform. For detailed information, or to register for one or both days, click here.
Iowa Court Upholds Intentional Interference with a Bequest Judgment
On July 18, 2018, the Iowa Court of Appeals affirmed a trial court judgment declaring a testator’s will invalid on the grounds of lack of testamentary capacity and undue influence and finding her son liable for intentional tortious interference with a bequest. This case again highlights a tort that made news last year when a brother won $1.5 million in damages against his sisters for turning their parents against him. For more information, click here.
Lots to See on TaxPlace!
We had lots going on in July, and it's all available for review for our TaxPlace subscribers:
Guidance is Trickling in, but Nothing Big Yet
We’ve been patiently (or maybe not so patiently!) awaiting guidance for many of the key provisions in the Tax Cuts & Jobs Act for months now. As July turns to August, we continue the wait.
Of course, IRC § 199A is perhaps the provision that presents the most planning opportunities for many businesses of all sizes. But without guidance for 199A, which provides a 20 percent deduction for “qualified business income” from a “qualified trade or business,” we’re left scratching our heads when it comes to many decisions. We don’t even know halfway through the year what those phrases mean.
It does appear that IRS and Treasury sent three sections of § 199A guidance to the Office of Management and Budget & Review on July 23. Only one section of that guidance, however, the Computational guidance, shows as “pending review” before the OMB. The other two sections—Anti-abuse and Definitions—(yes, the ones we’re really waiting for) show no such status. It appears that the computational guidance may qualify for an expedited review, which is supposed to be kept to 10 days. We shall see and will continue to post updates as we get them!
To read more, click here.
Provisions to Watch During the Farm Bill Debate
Last week, the Trump Administration announced a $12 billion aid package to provide assistance to farmers impacted by tariffs imposed on China. Secretary Perdue has announced that the aid program will begin September 4, with some type of sign-up. As of this writing, we do not have sufficient details to know how the program will unfold or how it will impact the pending farm bill. We will keep you posted.
The Senate and the House have passed their respective versions of the 2018 farm bill. The Senate passed its bill by a vote of 86-11 on June 28, 2018, and the House passed its more partisan bill by a vote of 213 – 211 on June 21. Now, the debate moves to conference committee, where significant differences between the bills must be resolved. It is not clear how long this process may take. Although the Senate cancelled its usual August recess, the House will adjourn, and Congress has a tough fall schedule with mid-year elections fast approaching. The 2014 farm bill expires at the end of this year.
Each bill contains hundreds of pages of provisions, but the following article summarizes key provisions of interest for agricultural producers. Watch for changes and more details as the debate unfolds.
To read more, click here.
Many New Iowa Laws Are Now in Effect
Once the fence viewers determine that it is unfeasible to build a portion of a partition fence, they will seek to have the parties agree to an alternative. If this does not occur within 60 days, the viewers will order the erection of the fence at the most “feasible location on the property of the owner who initiated the controversy that is closest to the adjoining owner’s property boundary."
This law was effective July 1, 2018. To continue reading, click here.
Special thanks to our 2020-2020 Sponsors
Donate to CALT
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 tlkayser@iastate.edu or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
IRS Clarifies that Trusts and Estates May Continue to Deduct Key Expenses
On July 13, 2018, in Notice 2018-61, IRS and Treasury clarified that estates and non-grantor trusts may continue to deduct administrative fees and expenses, even while miscellaneous itemized deduction are suspended (through 2025) for individual taxpayers.
Continue reading here.
IRS Issues Guidance on 529 Education Savings Plan Changes
On July 29, 2018, IRS and the Treasury issued Notice 2018-58, which states that the agencies will be issuing regulations clarifying several issues relating to IRC § 529 plans. This guidance was necessitated by changes made to the plans by the Protecting Americans from Tax Hikes (PATH) Act and the Tax Cuts and Jobs Act of 2017 (TCJA).
To continue reading, click here.
Some Iowans Who Claimed Research Credit in 2017 May Need to File Amended Return
On May 30, 2018, the Iowa Legislature passed S.F. 2417, a significant overhaul of the Iowa tax code. Federal tax reform implemented by the Tax Cuts & Jobs Act set the stage for this legislation. Although most changes are prospective, or at least retroactive to January 1, 2018, the law made significant retroactive changes to Iowa's Research Activities Credit. Iowa issued guidance explaining the changes on July 23, 2018.
To continue reading, click here.
Guidance Issued for Head of Household Due Diligence Penalty
On July 18, IRS published proposed regulations, Reg-103474-18, to implement the new head of household due diligence penalty. The new law potentially subjects preparers to a $520 penalty for each misstep on every return. With this penalty, Congress continues to enlist preparers as the first line of defense for eliminating fraudulent returns. Continue reading here.