Question

The Deminis rule for nonsiging preparers says that a portion of the return will not be considered substantial if the item in question or claim for refund involves related amounts that are

Answer 1

The Deminis rule for nonsiging preparers says that a portion of the return will not be considered substantial if the item in question or claim for refund involves related amounts that are

- less than $2,000, or

- less than $100,000 and also less than 20% of the gross income (or adjusted gross income if the taxpayer is an individual)

This de minimis provision is now located in Prop. Regs. Sec. 301.7701-15(b)(3)(ii) and, in agreement with AICPA recommendations, has been increased to

-less than $10,000, or

-less than $400,000 and also less than 20% of the gross income as shown on the return or claim for refund.