Update On The IRS Attack on Conservation Easements... [ read ]
In prior blog posts, we discussed IRS efforts to combat what it considers to be abusive conservation easements deductions. In Notice 2017-10, the IRS warned that certain conservation easement deductions could be designed to avoid tax and had to be disclosed to the IRS. The notice said that some promoters "are syndicating conservation easement transactions that purport to give investors the opportunity to claim charitable contribution deductions in amounts that significantly exceed the amount invested."
Time for a Withholding Tax Checkup: Treasury Releases New Withholding Calculator... [ read ]
In December 2017, Congress enacted sweeping changes to the federal tax laws. There has been a great deal of discussion as to whether American workers would see significantly greater take-home pay as a result of the new tax laws. In January, the IRS released new withholding tables to help employers determine how much to withhold from their workers' paychecks. Employers were supposed to implement the new withholding changes by February 15th. Now the Treasury Department has released a withholding calculator for American workers to determine if employers are withholding the correct amount.
IRS Is Contacting Taxpayers Who Were Denied Access To or Withdrew From the Offshore Voluntary Disclosure Program... [ read ]
Since the beginning of the year taxpayers who either were denied access to or withdrew from the IRS Offshore Voluntary Disclosure Program (OVDP) have been receiving Letter 5935 from the IRS notifying them that they need to come into compliance with U.S. reporting requirements relating to foreign income, foreign entities, and/or foreign financial accounts. The letter is part of the IRS Large Business & International (LB&I) campaign announced late last year called "OVDP Declines-Withdrawals Campaign".
Coinbase Turning Over Information To the IRS Regarding Customers' Investments in Bitcoins... [ read ]
In previous blog posts, we have discussed the IRS and Department of Justice focus on virtual currencies and the IRS John Doe Summons that was served on Coinbase, the largest Bitcoin exchange in the United States. Late last year, Coinbase was ordered to comply with the IRS John Doe Summons for customer information. The summons to Coinbase was based in part on information obtained by the IRS in an audit of one or more taxpayers who admitted they had been using Bitcoin to underreport their taxable income.
Judge Maurice B. Foley Announced as Next Chief Judge of US Tax Court... [ read ]
On February 26, 2018, the United States Tax Court announced that Judge Maurice B. Foley was elected Chief Judge to serve a two-year term beginning June 1, 2018.
Section 199A - Navigating the Maze of the New Pass-Through Deduction... [ read ]
For taxable years beginning after December 31, 2017 and before January 1, 2026 individuals and trusts are entitled to deduct 20% of their share of qualified business income from partnerships, S corporations and sole proprietorships (loosely referred to for these purposes as "pass-throughs"). . . Ahhh, if only § 199A were so simple. However this seemingly simple deduction is in fact layered with enough limitations, exemptions and phase-ins to make one's head spin.
Taxpayer Wins Offshore Tax Case Completely; Tax Court Rejects IRS Proposed Assessment and Throws Out IRS Interpretation of the Statute of Limitations... [ read ]
When trying to resolve a tax issue, there are often highly-technical issues steeped in substantive tax principles that may steer the outcome. But sometimes there are other ways to resolve tax issues.
The IRS' New Authentication Procedure for Tax Practitioners... [ read ]
Any tax practitioner who has contacted the IRS after January 3, 2018 to obtain client information has received an unpleasant surprise. The IRS is asking the practitioner to provide his or her social security number and date of birth for authentication purposes. There is no doubt this is an attempt to address security concerns, including concerns about compromised CAF numbers, but the change has caught many in the tax community off guard and led to unpleasant exchanges with IRS personnel.
Tax Court Determines that IRS Must Obtain Written Penalty Approval under I.R.C. Section 6751(b) to Assert Penalties against Taxpayers.... [ read ]
On December 20, the Tax Court issued a supplemental opinion in Graev v. Commissioner, in which it reversed its prior position on I.R.C. Section 6751(b) and agreed with the Second Circuit's decision in Chai v. Commissioner. In Chai, the Second Circuit held that Section 6751(b)(1) requires the IRS to obtain written supervisory approval of an initial penalty determination no later than the date the IRS issues the notice of deficiency or files an answer asserting the penalty. A previous blog post discussed the Chai decision and its impact on pending Tax Court cases.
Taxpayers May Want to Consider Accelerating Large Dollar Purchases Under the New Tax Law... [ read ]
As the year comes to a close, one additional matter that individual taxpayers may want to consider is whether to expedite any large dollar purchases into this year if sales tax will be due on those transactions.
