Federal
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April 24, 2024
Mass. Golf Course Manager Gets 13 Months For Tax Fraud
A Massachusetts golf course manager was sentenced to 13 months in prison after pleading guilty to tax charges, following prosecutors' accusations that he manipulated contracts with a home developer to deflate their value.
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April 24, 2024
Court Pauses Order To Sell Office Park In $16M Tax Battle
A New Jersey federal court paused its order allowing the U.S. government to sell a family trust's office park to satisfy a trustee's $16.2 million tax debt Wednesday, giving the family time to appeal a decision approving the sale to the U.S. Supreme Court.
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April 24, 2024
Fla. Woman Had Run Out Of Fixes, 11th Circ. Rules
A district court did not err in dismissing the complaint of a Florida woman after she was given multiple opportunities to address barred claims and failed to adequately do so, the Eleventh Circuit said Wednesday.
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April 24, 2024
Tax Court Backs IRS On Accuracy-Related Penalty
The Internal Revenue Service complied with supervisory approval requirements when it levied a $99,000 accuracy-related penalty on two Florida men, the U.S. Tax Court ruled Wednesday.
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April 24, 2024
Philly Tells Justices To Skip Review Of Tax Credit System
A Philadelphia resident's claims that the city illegally refused to provide her a tax credit for her state income taxes paid to Delaware doesn't warrant U.S. Supreme Court review because case law on the related constitutional issues is thin, the city argued Wednesday.
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April 24, 2024
Groups Back Intuit's 5th Circ. Challenge To FTC Over Ads
Business and conservative groups defended tax software giant Intuit Inc. in its Fifth Circuit constitutional challenge to the Federal Trade Commission's findings that the company engaged in deceptive advertising, saying the agency acts as both prosecutor and jury and that its administrative judges have unchecked power.
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April 24, 2024
GOP Reps. Form Work Groups To Address Expiring Tax Law
Republican members of the House Ways and Means Committee announced plans Wednesday to form 10 teams to study key provisions of the 2017 tax overhaul, aiming to set priorities for legislative action next year as the law is set to expire.
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April 24, 2024
R&D Cutbacks Spur Small-Biz Push To Renew Tax Breaks
Small businesses are pushing the U.S. Senate to quickly approve a House-passed bill that would renew a tax break for research and development, saying its expiration along with the demise of other key provisions has caused reduced investment in research and increased tax bills, threatening future operations.
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April 24, 2024
New IRS Unit Will Seek Quicker Tax Dispute Resolutions
The Internal Revenue Service's Independent Office of Appeals has created an alternative dispute resolution unit that will work with the agency's business operating divisions to help taxpayers resolve tax disputes sooner and more effectively, the IRS announced Wednesday.
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April 24, 2024
Treasury Limits Reach Of Look-Through Rule In Final Regs
The U.S. Treasury Department finalized regulations Wednesday that retain but narrow the scope of a proposal to, in a manner of speaking, look through the corporate owners of real estate investment entities to determine whether they are domestically controlled.
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April 24, 2024
IRS Followed Protocol In Choosing Higher IT Bid, GAO Says
The Internal Revenue Service reasonably assessed proposals for information technology engineering services before choosing an offer that was higher than others, the Government Accountability Office found.
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April 24, 2024
TIGTA Helps Stop $3.5B Pandemic Credit Scam, Agency Says
The Treasury Inspector General for Tax Administration, in conjunction with the Internal Revenue Service, has cracked down on a scheme where individuals potentially improperly claimed $3.5 billion in coronavirus relief tax credits, the office said Wednesday.
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April 23, 2024
Treasury Says Aussie Royalty Ruling Contradicts US, OECD
Australia's updated draft ruling regarding when payments for the rights to distribute software would be considered royalties conflicts with OECD and U.S. standards on the treatment of such deals, a U.S. Department of the Treasury official said in a letter made public Tuesday.
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April 23, 2024
Tax Court OKs IRS Notice After Petitioner Spews 'Gibberish'
The U.S. Tax Court ruled in favor of the Internal Revenue Service on Tuesday after a Nevada woman used "tax protester gibberish," the court said, in an attempt to circumvent more than $37,000 in unreported income.
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April 23, 2024
Biz Ownership Law Constitutional, Lawmakers Tell 11th Circ.
The Corporate Transparency Act is a garden-variety exercise of Congress' powers to address threats to national security, foreign affairs, commerce and tax collection, five Democratic lawmakers told the Eleventh Circuit, disputing a ruling that the law is unconstitutional.
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April 23, 2024
DC Circ. Backs Tax Penalties Against Swiss Couple
A Swiss couple who incurred $500,000 in penalties for failing to report millions of dollars they held in Swiss bank accounts can't get out of paying, the D.C. Circuit ruled Tuesday, rejecting their argument that the IRS didn't properly approve the fines.
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April 23, 2024
Int'l Pricing Pact Guidance Is Coming Soon, IRS Official Says
Updated Internal Revenue Service guidance that would help multinational corporations pursue advance pricing agreements will likely be released in a few months, an agency official said Tuesday.
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April 23, 2024
Migrant-Hiring Crimes And Tax Evasion Get Pair Prison, $1.8M Fine
A Florida federal judge has ordered two men to pay $1.8 million to the U.S. government and sentenced them to three years in prison after they confessed to recruiting migrants without employment authorization and failing to report workers' wages for tax purposes.
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April 23, 2024
Tomato Cos. Ask 9th Circ. To Allow Immediate Cost Deduction
Two companies that supply 40% of U.S. tomato paste and diced tomatoes asked the Ninth Circuit to allow deduction of their facilities' restoration costs during the tax year in which the tomatoes are processed, even though the companies don't pay the restoration costs until later.
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April 23, 2024
Atty Can Deduct $303K In Racing Ad Costs, 10th Circ. Told
A Colorado attorney asked the Tenth Circuit to reverse a U.S. Tax Court decision that prevented him from deducting $303,000 in advertising expenses tied to his automobile racing, saying the lower court incorrectly ruled that the costs were related to a hobby rather than his litigation practice.
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April 23, 2024
Feds Want About 3 Years In Prison For LA Bank Embezzler
The former chief financial officer at a community bank in Los Angeles should spend nearly three years in prison after admitting he embezzled more than $700,000 and used employee identities in a life insurance scheme, the government told a California federal court.
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April 23, 2024
Indicted 'Magician' Tax Preparer's Clients Under Scrutiny
Clients of a New York City-based tax preparer who earned the nickname "the magician," allegedly making $15 million while fraudulently depriving the IRS of $100 million, may also face charges, a prosecutor told the federal judge in charge of the case on Tuesday.
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April 23, 2024
IRS Opens Low Income Clinic Grant Period For 2025
The Internal Revenue Service has begun accepting applications from Low Income Taxpayer Clinics for matching funds in 2025, the agency announced Tuesday.
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April 23, 2024
DOL's Final Investment Advice Regs Expand ERISA's Reach
The U.S. Department of Labor issued final regulations Tuesday broadening who qualifies as a fiduciary under the Employee Retirement Income Security Act, backing off some changes included in a proposal the agency released in October.
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April 22, 2024
Hedge Funder's IRS Suit Over Leaked Tax Info Gets Trimmed
A Florida federal judge on Monday dismissed part of a hedge fund executive's case seeking to hold the Internal Revenue Service accountable for a leak of his private tax data to the media, saying he failed to show he suffered any damages.
Expert Analysis
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IRS Guidance Powers Up Energy Tax Credit Transfers
Recent IRS guidance on the monetization of energy tax credits provides sufficient clarity for parties to start negotiating transfer agreements, but it is unclear when the registration process required for credits to change hands will be up and running, say attorneys at Shearman.
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Using Agreements To Cover Gaps In Hydrogen Storage Regs
The Inflation Reduction Act's incentives for energy storage have spurred investment in hydrogen storage and production, but given the lack of comprehensive regulations surrounding the sector, developers should carefully craft project and financing agreements to mitigate uncertainties, say Omar Samji and Sarah George at Weil, and attorney Manushi Desai.
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Secure 2.0 Takeaways From DOL's 2024 Budget Proposal
The U.S. Department of Labor’s fiscal year 2024 budget proposal provides insight into the most pressing Secure 2.0 implementation issues, including establishment of a search database for finding lost retirement savings and developing guidance on the execution of newly authorized emergency savings accounts, say attorneys at Maynard Nexsen.
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Avoiding Negative Tax Consequences In Loan Modifications
Borrowers who may be caught in the dramatic uptick in nonperforming commercial real estate loans should consider strategies to avoid income and capital gains tax that may be triggered by loan modifications, says Aman Badyal at Glaser Weil.
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Benefits And Beyond: Fixing Employee Contribution Failures
Employers must address employee contribution failures promptly in order to avoid losing significant tax benefits of 401(k) or 403(b) plans, but the exact correction procedures vary depending on whether contributions were less than or greater than intended, say attorneys at Seyfarth Shaw.
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Now Is The Time For State And Local Sales Tax Simplification
In the five years since the U.S. Supreme Court’s landmark decision in South Dakota v. Wayfair, state and local governments increasingly rely on sales tax, but simple changes are needed to make compliance more manageable for taxpayers, wherever located, without unduly burdening interstate commerce, says Charles Maniace at Sovos.
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Recent Bills Show Congress' Growing Maturity On Cannabis
Though two recently introduced cannabis reform bills, the Prepare Act and the Small Business Tax Equity Act, are unlikely to pass in this Congress, they demonstrate a new level of focus and sophistication on the part of lawmakers as it relates to cannabis at the federal level, says Irina Dashevsky at Greenspoon Marder.
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What To Make Of IRS' New Advance Pricing Guidance
Recent guidance on the IRS' goals for its advance pricing agreement system provides helpful insight into review and decision-making procedures for advance pricing agreement requests, but it also raises questions about the IRS' objectives, say Richard Slowinski and Stefanie Kavanagh at Alston & Bird.
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Compliance Obligations Still Murky For Superfund Excise Tax
Comments on the IRS' reinstatement of the Superfund chemicals excise tax show that, given taxpayers' lack of institutional knowledge and the government's previous failure to finalize clarifying guidance, further regulatory action is needed to help taxpayers understand their obligations, say Nicole Elliott and Mary Kate Nicholson at Holland & Knight.
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The Reciprocal Tax Bill Is A Warning Shot At Pillar 2
A bill recently introduced in the House of Representatives to reciprocally tax countries deemed to have imposed discriminatory taxes on U.S. citizens and businesses takes aim at countries implementing the global minimum tax treaty known as Pillar Two, with which the U.S. has not complied, says Alan Cole at the Tax Foundation.
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3 Developments That May Usher In A Nuclear Energy Revival
A recent advancement in nuclear energy technology, targeted provisions in the Inflation Reduction Act and a new G7 agreement on nuclear fuel supply chains may give nuclear power a seat at the table as a viable, zero-carbon energy source, say attorneys at Vinson & Elkins.
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What Tax-Exempt Orgs. Need From Energy Credit Guidance
Guidance clarifying the Inflation Reduction Act’s credit regime, expected from the U.S. Department of the Treasury this summer, should help tax-exempt organizations determine the benefits of clean energy projects and integrate alternative energy investments into their activities, say attorneys at Morgan Lewis.
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Unconventional Profits Interest Structures Find New Support
A recent U.S. Tax Court ruling should provide comfort that less-than-plain-vanilla profits interest structures, created to achieve complicated economic arrangements, can succeed in generating more optimal tax outcomes, provided the terms are properly drafted, says Daren Shaver at Hanson Bridgett.