August CALT Brief Podcast - Tax Edition
This August 14 edition (which includes downloadable slides) reviews the following developments:
- New Automatic Waiver for Estimated Tax Penalty
- New Tax Withholding Estimator
- New August Draft of Form W-4
- New Draft of Publication 15T
- Review of Tax Extender Task Force Reports
- New Iowa Rules for Like-Kind-Exchange in 2019
- Truckers Must File Form 2290 by September 3
From the Iowa Courts
Explanation of Proposed 199A Cooperative Regulations
In this August article published in the Bloomberg Tax Tax Management Real Estate Journal, Kristine explains the proposed 199A cooperative regulations, as they impact cooperative patrons. Part II, due for release in September, will examine the impact of the proposed regulations on specified cooperatives.
Administration Revises Endangered Species Rules
On August 12, 2019, the Administration released final rules implementing portions of the Endangered Species Act. The new regulations, among other things, revise the procedures and criteria for listing or removing a species from the lists of endangered or threatened wildlife and plants, restore the regulatory distinction between endangered and threatened species, and require more inter-agency consultation.
As soon as the rules were issued, environmental groups filed a legal complaint, alleging that the rules are unlawful and would impermissbly weaken protections granted by the Endangered Species Act. We will keep you posted!
As many farmers continue to struggle with high debt and uncertain markets, new attention is focused on remedies for financially distressed farmers. President Trump signed into law the Family Farmer Relief Act of 2019 on August 23, 2019. This law increases the amount of debt a farmer may have, yet still remain a “family farmer” eligible for Chapter 12 bankruptcy protection. The new law raises this threshold from $4,411,400 (indexed for inflation) to $10,000,000.
The industry will be watching to see what impact this change might have. Recent statistics from the U.S. Bankruptcy Courts show that Chapter 12 bankruptcy filings increased from 475 between July 1, 2017, and June 30, 2018, to 535 between July 1, 2018 and June 30, 2019. In Iowa this number increased from 18 to 24 during the same time frame. Although increasing, these numbers remain low. In 1987, by contrast, nearly 5,000 farmers filed for Chapter 12 protection.
On August 29, 2019, IRS issued draft instructions for Form 8995, Qualified Business Income Deduction Simplified Computation. The instructions provide some useful guidance, as well as a new QBI flowchart. Detailed below are some highlights. We we will watch for the instructions for Form 8995-A.
The instructions explain a new reporting category for K-1s: QBI/Qualified PTP Items Subject to Taxpayer-Specific Determinations. The instructions state that these items are not automatically included in QBI. Instead, the character of the item will depend upon how it is reported on the taxpayer’s individual return. For example, the instructions state that ordinary business income or loss is generally included in QBI if it was used in computing taxable income, not excluded, suspended, or disallowed under any other section of the Code. Also, a section 1231 gain or loss is only includible in QBI if it is not a capital gain or loss.
On August 21, 2019, the United States District Court for the Southern District of Georgia became the second federal court in the past three months to rule that the 2015 Waters of the United States Rule (the WOTUS Rule), was improperly issued by the Environmental Protection Agency and the U.S. Army Corps of Engineers. Rather than vacate the rule, the court remanded it to the agencies for further action. This case is Georgia v. Wheeler, No. 2:15-Cv-00079 (S.D. Ga. August 21, 2019).
The plaintiffs in this case included the States of Georgia, West Virginia, Alabama, Florida, Kansas, Kentucky, South Carolina, and Utah. They filed a lawsuit shortly after the WOTUS Rule was finalized, asking the court to vacate the Rule on the grounds that:
- The agencies exceeded their statutory authority under the Clean Water Act,
- The agencies failed to adhere to the Administrative Procedures Act, and
- The Rule violated the Tenth Amendment and Commerce Clause of the U.S. Constitution
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 firstname.lastname@example.org or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
Don't Miss our Annual September Seminars!
- The September 23 Agricultural Law Seminar addresses key topics, including: the state of the ag economy, industrial hemp, Iowa Business Specialty Courts, new conservatorship and guardianship provisions, highly erodible land and wetland conservation developments, ethics for the rural practitioner, and legal issues impacting contract feeding arrangements.
- The September 24 Agricultural Tax Workshop features guest speakers discussing a number of timely agricultural tax issues. Participants will receive the 200+ page 2019 Agricultural Tax Issues Workbook.
The live webinar will include a video stream of the speakers. For more detailed information or to register, access our September Seminars page. Room blocks are available until September 13.
Divorce Decree Doesn't Cut it When Noncustodial Parent Seeks Tax Benefits
A recent case from the Tax Court explains the special “qualifying child” rule for children of divorced parents. Although it has been in place for decades, the rule still causes confusion, especially among clients.
We are very pleased to welcome Angela Ossian as our CALT program coordinator! Angela brings much experience and many skills to this role, and she is dedicated to ensuring that CALT is providing excellent service to our constituents. You can reach Angela at email@example.com or 515-294-5217. We are very happy she is officially joining our team after serving as our interim coordinator since July.
See You at Tax School!
Registration is underway for our 46th Annual Federal Income Tax Schools, held at seven locations throughout Iowa! The Ames session includes a live webinar that will be videostreamed.
- October 31-November 1: Maquoketa
- November 7-8: Mason City
- November 11-12: Fairfield
- November 14-15: Le Mars
- November 21-22: Atlantic
- November 25-26: Waterloo
- December 9-10: Ames (and live webinar)
Can't wait to see you there!
The Center for Agricultural Law and Taxation 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. The Center'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.