Coolidge Wall Co., L.P.A.
Phone : 937-608-9464 | Toll Free : 877-422-0702

December 2015 Archives

IRS Extends the ACA's Form 1094 and Form 1095 Filing Deadlines

The IRS has unexpectedly extended the deadlines by which insurers and self-funded employers must provide health plan enrollment and coverage information to employees and the IRS under the Affordable Care Act. This is the information required to be reported on Forms 1094 and 1095. Notice 2016-4 issued December 28 extends the due dates:

Effective Date of the ACA's "Cadillac" Tax Postponed by the Appropriations Act

The monolithic Consolidated Appropriations Act of 2016, which became law December 18, changes the effective date of the Affordable Care Act's so-called "Cadillac" tax.

Good News for Underwater Homeowners

A homeowner is considered to be "underwater" or "upside down" on their house if they owe more to the bank on their mortgage (or mortgages) than the value of the home. Some homeowners in this position are simply unable to sustain the expenses of retaining the home, and unable to continue making payments. There are options other than bankruptcy for those homeowners, but many of those options carry the threat of an increased income tax burden. For example, a homeowner may be able to obtain a mortgage modification that reduces the amount of the debt to match the value of the home or obtain a short sale, where the bank agrees to take a bit less (to a lot less) than what they are owed in order to have the house sold for fair market value - without the delay and expense of foreclosure. Since both of these options include the bank forgiving a portion of the mortgage debt, the default rule in the tax laws requires the bank to issue a 1099 for the amount of debt that is forgiven, which is treated as income to the homeowner. While the tax laws include permanent provisions that are available to some homeowners to exclude this phantom income from income for the year, the rest of the homeowners may be left with a high tax bill. Although the mortgage could have been cleansed in a bankruptcy case, the tax bill resulting from dealing responsibly with the debt load cannot be dealt with in a bankruptcy for quite some time.

New Rules Governing Adult Guardianships

In 2014, the Columbus Dispatch published a five-part investigative report highlighting guardianship abuse in Ohio. During the course of the series, the Dispatch identified lawyer Paul S. Kormanik as a Court appointed guardian of over 400 incompetent adults. Mr. Kormanik did not meet with his wards on a regular basis, if at all, and was quoted as saying that nursing homes acted as his eyes and ears.