Nichols Tax Update 21-40

  1. IRS Announces Extension of Replacement Period for Sold Livestock
    • The IRS has announced (IR-2021-193) that farmers and ranchers who previously were forced to sell livestock due to drought may have an extended period to replace the livestock and defer tax on any gains from the forced sales. [IR-2021-193, 9/24/2021]
  1. Separate Gifts of Land Can’t Be Aggregated in Gift Tax Case
    • A U.S. district court denied the government’s motion for partial summary judgment in its challenge of an individual’s valuations of timberland for federal gift tax purposes, finding that his gifts of fractional interests in the land to his sons must be valued separately at the time of transfer. [Peter Buck v. United States; DC CT, No. 3:18-cv-01253, 9/24/2021]
  1. Boat Chartering Activity Deductions Subject to 2 Percent Floor
    • The Tax Court, denying a motion for partial summary judgment, held that a couple’s deductions under section 183(b)(2) for their boat chartering activities, which the IRS determined lacked a profit motive, constitute miscellaneous itemized deductions for purposes of the 2 percent floor in section 67(a). [Gregory et al.; T.C. Memo. 2021-115, 9/29/2021]
  1. Temporary Regs Implement IDR Requirements in Surprise Billing Law
    • Federal agencies, including Treasury, have issued temporary regulations (T.D. 9955) implementing provisions of the No Surprises Act that establish a federal independent dispute resolution process that group health plans, non-participating providers, facilities, and providers of air ambulance services may use to determine the out-of-network rate for specified services. [T.D. 9955. 9/30/2021

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(*** identifies item with useful analysis of current issue but not covered in Lynn’s recorded commentary due to complexity and time required for fair comment.)