No touchdown for this coach

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“Ordinary and necessary” expenses incurred in the pursuit of a trade or business are generally deductible. But in one case, most of the expenses claimed by a married couple were denied. The husband, a high school coordinator and coach, failed to prove that costs for meals, telephone, seminars, software, “student motivation” and more were business related or related to his teaching duties. He did substantiate the costs of football equipment he provided to low income students and was allowed to deduct them. (TC Memo 2017-42)

Travel deductions denied

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Taxpayers traveling “away from home” can deduct ordinary and necessary expenses incurred in a trade or business. But when nonresident alien students at foreign universities, who participated in a summer work-travel program, deducted travel costs to and from the U.S. and certain living expenses while here, the IRS denied the deductions. The U.S. Tax Court agreed, stating that the students weren’t “away from home in pursuit of a trade or business,” so their travel and living expenses weren’t deductible. (Liljeberg, 148 TC No. 6)

President Trump’s budget cuts IRS funding by $239 million

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The President has released his “skinny budget” for 2018. A precursor to the full budget due in May, it’s a wish list of cuts and some basic economic projections in which he lays out plans for boosting military spending, cutting foreign aid and some domestic programs, and slashing IRS funding. The budget targets the IRS’s “antiquated operations” but states that the agency can “continue to combat identity theft, prevent fraud, and reduce the deficit” through enforcement and administration of tax laws.

IRS ruled favorably on a community cultural center’s tax-exempt issues

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The IRS has privately ruled on a number of issues with regard to a tax-exempt organization’s activities in building and operating a cultural center, including whether its operation of a coffee shop would be an unrelated trade or business, whether certain transfers would be self-dealing transactions and whether the cost of obtaining the ruling would be a qualifying distribution. The organization is classified as a private operating foundation. (PLR 201710005)