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Taxpayers who are direct or indirect shareholders PFICs must file IRS Form 8621. A PFIC is a foreign company with mostly passive income or assets and Form 8621 is required when receiving PFIC distributions, selling PFIC stock, making certain elections, or filing annual reports under specific IRS sections. Indirect shareholders include those with significant ownership in companies that hold PFIC stock or pass-through entities with PFIC investments. Failure to file correctly can lead to penalties.

Employee Stock Ownership Plans (ESOPs) allow employees to own shares in their company, but they come with several risks and tax considerations. ESOPs can lose value during bear markets, and since employees' investments are tied to one company’s stock, they lack diversification, increasing financial risk. Administering an ESOP is costly, involving legal, accounting, and compliance expenses. Additionally, shares in an ESOP may be bought back at lower-than-market value. Regarding taxes, ESOPs are typically tax-deferred, meaning taxes are paid when funds are withdrawn. However, early withdrawals before age 59½ can incur a 10% penalty. Employees leaving the company may need to wait for the company to buy back their shares.

An Employee Stock Ownership Plan (ESOP) is a retirement plan that gives employees ownership in their company through stock. It’s company-funded, tax-deferred, and can increase employee engagement and satisfaction. Employees typically earn more stock over time based on tenure or milestones. While beneficial for both employees and companies, ESOPs come with certain drawbacks and tax implications, which will be discussed in part 2.

Businesses that sell a product or provide services must obtain a state-level TPT license. In addition to a state-level TPT license, businesses may also need a license from any and all cities in which they do business. There are several factors that determine if a business will need multiple state-level TPT licenses.

The challenge with form JT-1 (Arizona Joint Tax Application) is not missing any of the details. This can include knowing the difference between types of taxes, filing requirements, and where a business operates. This form also covers multiple types of taxes at local, county, and state levels.

So you want to purchase a vacation home with funds from their retirement accounts? That is possible, however, there are some rules to know before accessing those funds.

Beneficial ownership information (BOI) is the identifying information for any individuals who either directly or indirectly own or control a company.

If you're an employer responsible for employment tax deposits, it's crucial to make those payments on time to avoid penalties.

Arizona requires all contractors to be licensed through the state. There are some exceptions to this rule, however, including the owner-builder exemption.

 The IRS allows individuals to revise some payment plans to include current-year tax balances. Offers in Compromise (OIC), however, cannot be amended to include the current tax year’s tax.

In Arizona, businesses pay for the privilege of working in the state through the transaction privilege tax (TPT). Determining the requirement to apply for a TPT license is not always easy as different factors are considered to determine the requirements.

New AI research tools are assisting the IR in identifying high-income taxpayers who may not be current on their bills.

Taxpayers aren't the only ones with deadlines, the IRS has deadlines for collection and assessment of tax.

Self employed Taxpayers should be aware that reporting certain information on their Schedule C forms could act as red flags and trigger an audit.

The IRS has increased hiring agents, which could mean an increase in audits for Taxpayers.

A CP298 Notice is a last-ditch notice by the IRS. Taxpayers will receive this notice when the IRS has been unsuccessful in previous attempts to contact them regarding unpaid taxes. But you may still have payment arrangement options with the IRS.

A taxpayer will receive a CP94 notice after a court orders them to pay an amount of restitution.

Notice CP161 is to inform the Taxpayer that the IRS has determined they have an outstanding balance. It's important to respond to this notice in a timely manner to avoid any additional interest and penalties.

Do not be alarmed if you receive a Notice CP59, this notice is used to inform a taxpayer that the IRS has no record of their return.

If the IRS determines you have unpaid taxes, they will send an LT75 Notice informing the Taxpayer of their unpaid balance and that a levy has been place against them.

If you received an audit notice it is important to note the timeline and the request for information within the letter, failure to timely respond may result in limited options for resolution later.

Receiving a CP22A notice means that the IRS has made changes to a previously filed tax return, it's important to read to determine if the changes are correct.

An LT11 Notice is the Internal Revenue Service's warning that it intends to make a claim to your property.

The IRS has found that many employers who thought they were eligible for employee retention credits (ERC) were in fact not eligible. Now the IRS has created a temporary program to assist businesses to correct their ERC claim.

Receiving an LT26 Notice means the IRS's attempts to reach you regarding unfiled federal tax returns have gone unanswered. The LT26 Notice requested the unfiled returns be filed and warns a taxpayer about potential fines and penalties if the returns remain unfiled.