Funeral expenses can’t be deducted

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On their joint tax return, a married couple deducted $27,400 in funeral and estate administration expenses they’d paid after the wife’s father died. The IRS denied the deductions and the U.S. Tax Court agreed. “Funeral expenses are clearly personal or family expenses” that are nondeductible, the court stated. The taxpayers said they’d relied on various IRS publications in claiming the deductions. The court explained their reliance on the publications was “misplaced” because they discussed different expenses.

Small business owners may be able to take advantage of home office deductions

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In a recent release, the IRS highlighted tax resources available to small business owners. One such tax-saving option is claiming home office deductions. Small business owners have two options: the regular method and the simplified method. Be aware that, regardless of the method used to compute the deductions, business expenses in excess of the gross income limitation aren’t deductible. Go to http://bit.ly/2r1yIfl to learn more.

Another circuit holds that tax debt on a late-filed tax return is rarely dischargeable in bankruptcy

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The U.S. Court of Appeals for the Third Circuit has ruled that, except with respect to returns prepared with the assistance of the IRS, debts for unpaid taxes from late-filed tax returns aren’t dischargeable in bankruptcy. In so doing, it affirmed U.S. District Court and bankruptcy court decisions and also came to the same conclusion as the U.S. Appeals Courts in eight other circuits.

Health care reform still a White House priority

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President Trump tweeted on April 30 that a “new healthcare plan is on its way. Will have much lower premiums and deductibles while at the same time taking care of pre-existing conditions.” The President’s top aides said they want the U.S. House of Representatives to vote this week on a bill to repeal and replace the Affordable Care Act, though a vote isn’t scheduled yet and Republicans say they still lack the votes to pass it. Even if the plan passes the House, it’s expected to face a tough fight in the Senate.