INCOME TAX

Court Decision 2075, page 548. Tax Liens. The Supreme Court has concluded that under section 6321 of the Code the husband’s interests in the entireties property constitute “property” or “rights to property” to which a federal tax lien may attach. United States v. Craft.

Rev. Rul. 2002–58, page 541. This ruling clarifies that amounts reimbursed under a self-insured medical expense reimbursement plan for medical expenses incurred by an employee prior to the adoption of the plan are not excludable from the gross income of the employee under section 105(b) of the Code.

Rev. Rul. 2002–59, page 557. Interest rates; underpayments and overpayments. The rate of interest determined under section 6621 of the Code for the calendar quarter beginning October 1, 2002, will be 6 percent for overpayments (5 percent in the case of a corporation), 6 percent for underpayments, and 8 percent for large corporate underpayments. The rate of interest paid on the portion of a corporate overpayment exceeding $10,000 will be 3.5 percent.

T.D. 9013, page 542. Final regulations under section 469 of the Code recharacterize a percentage of certain portfolio income and expense as passive income and expense when a taxpayer engages in a lending transaction with a partnership or S corporation in which the taxpaer owns a direct or indirect interest and the loan proceeds are used in a passive activity.