Top Federal Tax Issues for 2025 CPE Course: Module 2

Author: A.J. Reynolds, Jim Buttonow, Klaralee R. Charlton, Steven D. Mercatante, Susan Harper

Wolters Kluwer's Top Federal Tax Issues Course identifies those recent events that have developed into the current “hot" issues of the day. These tax issues have been selected as particularly relevant to tax practice in 2025. They have been selected not only because of their impact on return preparation during the 2025 tax season but also because of the important role they play in developing effective tax strategies for 2025 and beyond. This module covers tax tips and issues. Topics covered include 1099 essentials, planning for the estate tax exemption cliff, virtual currency, 20 essential tax problem-solving tips, and navigating the top 10 IRS issues for small businesses.

Publication Date: December 2024

Designed For
CPAs and Tax Professionals

Topics Covered

• 1099 E-Filing Changes
• Forms 1099-NEC and 1099-MISC
• Form W-9
• Validating Data
• Backup Withholding
• Form 1099 Corrections
• B Notice Response Best Practices
• Details of the Estate Tax Cliff
• Using the Exemption Prior to 2026
• Post-Death Tax Mitigation
• What is Virtual Currency?
• Form 1040 Digital Assets Question
• Key Concepts and Vocabulary
• IRS Guidance and Compliance Efforts
• Tax Principles for Virtual Currency
• Common Cryptocurrency Transactions
• FinCEN and Form 8938
• Virtual Currency Best Practices
• Top 20 IRS Tax Problem-Solving Tips
• IRS Audit Issue #1: Unreported Income
• IRS Audit Issue #2: Code Sec. 183 Hobby Loss Rules
• IRS Audit Issue #3: S Corporation Reasonable Compensation
• IRS Audit Issue #4: S Corporation Losses in Excess of Basis
• IRS Audit Issue #5: Construction Industry
• IRS Audit Issue #6: Employee vs. Independent Contractor
• IRS Audit Issue #7: Form 1099-K
• IRS Audit Issue #8: Form 1099 Noncompliance
• IRS Audit Issue #9: IRS Package Audits
• IRS Audit Issue #10: Penalties

Learning Objectives

• Recognize what you are required to report on Form 1099 and when those payments are reportable
• Identify Form 1099-NEC/MISC boxes
• Describe what information a payer needs from a payee to properly report a payment
• Recognize how to use the W-9 to collect the correct information and when you are required to obtain a signed W-9
• Identify how to use the IRS TIN Matching program and how it can help ensure the information you have is correct
• Identify the changes implemented by the Tax Cuts and Jobs Act (TCJA) to the basic exclusion amount and the impact on taxpayers when the exclusion returns to pre-TCJA levels
• Describe the potential types of transfers that a taxpayer should consider to lock in the increased exclusion and powers to avoid inclusion in the gross estate
• Identify gifting transactions and the pros and cons related to various gifting scenarios
• Recognize tax-saving opportunities and clients who should consider large gifts before 2026
• Identify the basic exclusion amount for deaths occurring in 2024
• Identify virtual currency
• Identify and translate cryptocurrency’s vocabulary
• Identify IRS notices, revenue rulings, and FAQs concerning cryptocurrency
• Identify the 18 tax principles for virtual currency
• Recognize common cryptocurrency tax events
• Identify FinCEN regulations regarding virtual currency
• Identify Form 8938 requirements
• Recognize how to formulate best practices concerning virtual currency
• Recognize what to include in an engagement letter for a tax practice
• Recognize trends in current IRS compliance enforcement programs
• Identify the most common tax problems facing taxpayers and solutions that are commonly used to resolve these problems
• Recognize how to follow the three-step tax problem-solving process to effectively resolve a client’s tax problem
• Identify how to set up a firm to be proactive in resolving client IRS post-filing issues and notices
• Identify tips that will increase client retention
• Recognize the top 10 IRS audit issues for small businesses
• Identify why the IRS audits these issues
• Describe how to mitigate the risk of an IRS audit, as well as how to prepare for an IRS audit
• Recognize the consequences if an IRS tax deficiency arises involving one of the top 10 IRS audit issues
• Identify the largest component of the tax gap

Level
Intermediate

Instructional Method
Self-Study

NASBA Field of Study
Taxes (9 hours)

Program Prerequisites
A basic understanding of estate tax will be helpful before taking this course.

Advance Preparation
None