IRS Statute of Limitations and Civil Fraud... [ read ]
On July 26th, U.S. Tax Court Judge Lauber issued an opinion in George S. Harrington v. Commissioner, upholding the IRS' determinations that the taxpayer fraudulently underreported his offshore income and the civil fraud penalty applied. There is nothing particularly unique about the case but it includes a very good discussion of the factors the court will consider when the IRS proposes a civil fraud penalty and the resulting impact on the statute of limitations.
Taxpayer's Penalty Defense Gets Boyled (Boiled?)... [ read ]
In previous blog posts I have discussed the late filing penalty and the reliance on a tax professional defense to the penalty. We discussed the reliance defense with respect to a late estate tax return and with respect to late e-filed returns .
Are You Feeling Lucky? IRS Taxes on Wagers and Bookmakers... [ read ]
These days it seems like the government taxes everything it can. While it is debatable whether or not that is true, there are a number of "hidden" taxes of which many taxpayers are unaware. Taxes on wagers and occupational taxes on bookmakers are a couple of those "hidden" taxes. Although the casinos in Las Vegas know about and pay these taxes, illegal bookmakers may not be and could be facing significant tax liabilities as a result.
Is There Still Hope for Taxpayers? Another Court Determines Previous IRS Guidance Limiting FBAR Penalty is Invalid... [ read ]
On July 13, 2021, the Second Circuit issued an opinion in United States v. Kahn, No. 19-3920 (2d Cir. 2021) affirming the trial court's grant of summary judgment against the defendants for FBAR penalties, plus statutory additions and interest, in the amount of $4,264,728.
Recent Legislation Gives Taxpayers Greater Access to District Court in Challenging the Texas Comptroller's Denial of a Refund Claim or Assessment of Tax... [ read ]
Among the various bills that became law in the 87th Texas Legislature of 2021 are two amendments to the Texas Tax Code that will significantly impact the procedures available for challenging the denial of tax refund claims and assessments by the Texas Comptroller of Public Accounts in district court. Both of these bills (SB 903 and HB 2080) are intended to make district court more accessible to taxpayers.
Because 130 Years Isn't Long Enough... [ read ]
Under Texas law, a non-charitable trust may not last forever. Historically, a Texas trust was required to vest, "not later than 21 years after some life in being at t he time of creation of the interest, plus a period of gestation".
Will Claiming a Carryback Open a Prior Year to Audit?... [ read ]
The CARES Act resurrected the carryback of net operating losses (NOL) for 2018, 2019, and 2020. An individual taxpayer has a choice in how they request a refund for a carryback NOL, and the statute of limitations applies differently depending on which alternative they choose.
More Clouds on the Horizon for Micro Captives and Syndicated Conservation Easements, as the IRS unveils the Newly-Established Office of Promoter... [ read ]
Yesterday, the Internal Revenue Service announced the establishment of the IRS Office of Promoter Investigations. The new office will further expand on the efforts of the Promoter Investigations Coordinator that began last summer and will continue to focus on micro captives and syndicated conservation easements.
Texans, You (Probably) Didn't Miss Your 2020 Federal Tax Return Filing Deadline; Here's What You Need to Know... [ read ]
As mentioned in a prior blog post, 2020 tax year federal tax filing deadlines for Texans were postponed. As a result of the February 2021 winter storm that wreaked havoc on Texas, the IRS announced in late February that victims of the storm would have until June 15, 2021 to file various federal tax returns, and make relevant payments. Pursuant to IRS guidance, affected taxpayers include individual and business residents of all 254 counties in Texas.
IRS Attempts to Use its latest Judicial Win to Scare Micro-Captive Participants into Submission... [ read ]
On the heels of its fourth judicial win in Tax Court, today the IRS urged participants in allegedly abusive micro-captive insurance arrangements to exit these transactions as soon as possible. For many taxpayers, this approach is akin to throwing the baby out with the bathwater, as contrary to the IRS' belief, not every micro-captive arrangement is abusive.