2005 Income Tax Seminar Book - Part I

Table of Contents / Page No.

Taxing Topics 1-38
Enrolled Agents CPE Audit 1
New Rules for Circular 230 3
Proposed Senate Bill (S. 832) 8
Federal Developments 12
Debt Discharge Income – Solvent Taxpayer 21
Debt Discharge – Bankrupt or Insolvent Taxpayer 23
Reduction of Tax Attributes (Form 982) 24
Foreclosure by Lender – Nonrecourse Debt 31
Foreclosure by Lender – Recourse Debt (Form 1099-A) 32
State and Local Sales Tax Deduction 34
Non-employee Director Fees 37
Divorce 39-98
Alimony and Separate Maintenance Payments 40
Disregarding Community Income 47
Child Support 49
Dependency Exemptions 50
Property Settlements 58
Division of Retirement Benefits 60
Taxes on Distributions 65
Filing Status 66
Earned Income Credit 90
Credit for Withheld Taxes 93
Sale of Marital Residence 97
Recommendations to Clients 97
Retirement Plan Options 99-112
Traditional 401(k) Plan 101
Actual Deferral Percentage (ADP) Test 101
Traditional 401(k) Worksheet – 2005 103
Safe Harbor 401(k) Plan 105
Qualified Roth Contribution Programs 106
Designated Roth Contributions Post – 2005 Tax Years 107
Limits on Designated Roth Contributions 108
Matching Contributions 108
Treatment of Excess Contributions Under Qualified Roth Contribution Programs109
Post – 2005 Rollovers form Designated Roth Account 111
Reporting Requirements for Post – 2005 Designated Roth Contributions 111
Steps for Employers and Recordkeepers 112
Oddities of Schedule D 113-144
Capital Gains Rates 114
Basis of Mutual Funds 116
Effect of Gifts 119
Effect of Inherited property 119
Holding Period 120
Wash Sale Rules 122
Sale of a Principal Residence 124
Net Unrealized Appreciation (NUA) 128
Puts & Calls 131
Tax Straddles 137
Commodity Hedging 138
Marked to Market Treatment of Section 1256 Contracts 140
Form 6781 Gains and Losses From Section 1256 Contracts and Straddles 142
MSA/HAS/HRA 143-166
Medical Savings Accounts (MSA) 146
High Deductible Health Plan (HDHP) for an MSA 147
MSA Contribution Limitations 147
Earned Income Limitation 149
Reporting MSA Contributions 149
Taxes on Distributions 150
MSA Example 151
Health Savings Accounts (HAS) 155
High Deductible Health Plan (HDHP) for HAS 155
How deductible and co-payment provisions affect HDHP status 155
Establishing an HAS 156
Rollovers from an Archer MSA 157
Time period for satisfying HDHP deductible provisions 158
Repayment of mistaken distributions from an HAS 160
Health Reimbursement Arrangement (HRA) 164
How the HRA works 165
Nonqualified reimbursements 165
Nondiscrimination Rules 165
HRAs and Cafeteria Plans 166