Federal
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February 29, 2024
Biz Owner's $2.4M FBAR Dispute Paused For Mediation
The U.S. government and a retired plumbing business owner mutually agreed to a 90-day stay of their $2.4 million tax dispute over foreign bank account reporting while they try to mediate a solution, a Georgia federal judge said Thursday.
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February 29, 2024
IRS Funding Cuts Would Raise Deficit $24B, CBO Says
A congressional agreement to rescind $20 billion in appropriated funding for the Internal Revenue Service this year would add $24 billion to the federal deficit through the next 10 years, according to Congressional Budget Office projections published Thursday.
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February 29, 2024
Ga. Man Convicted In $11M PPP Fraud Case Wants New Trial
An Atlanta man convicted on dozens of charges stemming from an $11 million pandemic loan fraud scheme has asked a Georgia federal judge for a new trial.
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February 29, 2024
IRS Amends Treatment Of Public Utility Debt
The Internal Revenue Service will not define certain public utilities as not recognizing gross income until the public utility receives the proceeds of a debt issued by the qualifying state financing entity, the agency said Thursday.
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February 29, 2024
NJ Towns Can't Sue Netflix, Hulu For Fees, 3rd Circ. Says
Two New Jersey municipalities cannot sue Netflix and Hulu for franchise fees under the state's Cable Television Act, the Third Circuit held Thursday in a precedential opinion, saying the state statute reserves enforcement of the law to the state Board of Public Utilities.
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February 29, 2024
IRS Enforcement Push Will Target 125K Wealthy Nonfilers
The Internal Revenue Service is ramping up enforcement against 125,000 high-income taxpayers who haven't filed returns since 2017 as a part of its ongoing efforts to increase tax compliance, the agency's chief told reporters Thursday.
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February 29, 2024
Senate Confirms First Woman To Top IRS Attorney Post
The U.S. Senate on Thursday confirmed a former director at EY who previously served as associate chief counsel, international, at the Internal Revenue Service to be the agency's chief counsel, making her the first woman to be confirmed for the role.
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February 29, 2024
Medtronic Says 3 Years Of Tax Returns Under IRS Audit
Three years of medical device company Medtronic's federal income tax returns are being audited by the Internal Revenue Service, the company said in a U.S. Securities and Exchange Commission filing.
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February 29, 2024
Bankrupt Endo To Pay $465M To Resolve Opioid Claims
Drugmaker Endo International has agreed to pay as much as $465 million to resolve criminal and civil claims stemming from its sale and marketing of a powerful opioid, and will turn over its assets to a group of secured lenders who will operate the company under a new corporate structure.
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February 28, 2024
Crapo Seeks Changes To Child Tax Credit Provisions In Bill
The top-ranking Republican on the Senate Finance Committee said Wednesday that he cannot support the bipartisan tax bill pending in the Senate as long as a provision that allows taxpayers to receive a refundable child tax credit based on their prior year's earnings is included.
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February 28, 2024
Amgen Seeks Dismissal Of Investor Action Over $11B Tax Bill
Amgen had no obligation to disclose specific amounts of proposed adjustments to its taxes, the company told a New York federal court as it again demanded dismissal of a proposed class action alleging the company hid a $10.7 billion tax bill from investors.
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February 28, 2024
Embattled Philly Loan Biz Principals Hit With RICO Charges
Legal troubles for the principals of Philadelphia's Par Funding cash advance company are mounting as federal prosecutors hit them with a new indictment adding Racketeer Influenced and Corrupt Organizations Act allegations on top of existing charges that the principals bilked investors out of hundreds of millions of dollars and threatened violence against borrowers.
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February 28, 2024
COVID Fraud Jury Can't Hear Of Gov't's Loan Error, Feds Say
A jury shouldn't be shown evidence of the U.S. government's error in approving a Michigan business owner's application for a Paycheck Protection Program loan while he was under indictment, federal prosecutors have argued.
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February 28, 2024
Timeline Rule For Assessing Tax Not Retroactive, Court Says
A former corporate executive who received a $26 million buyout and then rolled the proceeds over to a retirement account incorrectly claimed that an amended statute of limitations exempted him from paying a penalty, the U.S. Tax Court ruled Wednesday.
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February 28, 2024
GOP Reps. Press IRS On Backdating Forms In Easement Case
Two House Republican tax writers pressed the Internal Revenue Service for details on how it would prevent agency employees from inappropriately backdating official tax documents after the agency admitted last year to doing so in a high-profiled suit involving conservation easement penalty forms.
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February 28, 2024
Divorced Woman Can Get Spousal Relief, Tax Court Says
A divorced woman has satisfied the requirements for innocent spousal relief despite an attempt by her ex-husband to refute her claim, the U.S. Tax Court ruled Wednesday.
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February 28, 2024
IRS Delays Tax Deadlines After Wash. Wildfires
Certain taxpayers in Washington state will have extra time to file tax returns and make payments following wildfires last year, the Internal Revenue Service said Wednesday.
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February 28, 2024
Court Should Block IRS 'Fishing Expedition,' Company Says
A company that claims it has been the victim of an Internal Revenue Service "fishing expedition" after being hit with a raft of document requests urged a Georgia federal judge Tuesday to keep alive its bid to quash the summonses, telling the court the government overstepped its bounds in seeking "a wide variety of duplicative, irrelevant, and unrelated information."
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February 28, 2024
Stalled Pillar 1 Raises Specter Of EU Digital Tax
The stalling at the international level of a redistribution of taxing rights known as Pillar One is raising questions about whether the European Union would revive a digital tax, which it had put aside hoping Pillar One would succeed.
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February 28, 2024
IRS To Hold Hearing On Donor-Advised Fund Excise Tax Regs
The Internal Revenue Service will hold a public hearing in May on proposed regulations regarding excise taxes on certain taxable distributions made from donor-advised funds, the agency announced Wednesday.
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February 28, 2024
IRS Adds 36 Tax Court Sessions To Calendar
The Internal Revenue Service named calendar administrators for 36 U.S. Tax Court sessions in March, April and May on Wednesday, bringing the total number of upcoming sessions to 72.
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February 27, 2024
TaxAct Filers Ink $23M Deal Over Meta, Google Info Sharing
TaxAct Inc. customers have asked a California federal judge to greenlight a settlement they say is worth more than $23 million and would resolve class claims accusing the tax preparation company of secretly sharing confidential taxpayer information with Meta Platforms Inc. and Google.
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February 27, 2024
US Biz Group Urges Treasury Against Basis Denial Rule
The U.S. Treasury Department should rethink its proposed upcoming rule that would deny the basis that U.S. companies have in particular foreign affiliates involved in certain inbound transactions, the National Foreign Trade Council said in a letter made public Tuesday.
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February 27, 2024
IRS Opens Free E-File Pilot To More New Users
The Internal Revenue Service temporarily reopened its free electronic filing pilot program to more new users Tuesday in the 12 states where taxpayers can participate, an agency official said in a statement.
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February 27, 2024
IRS Hires 2 To Lead Digital Asset Efforts
The Internal Revenue Service hired two staffers to assist with forming the agency's approach to cryptocurrency and other digital assets, the agency announced Tuesday.
Expert Analysis
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An Evaluation Of New Solar Energy Opportunities For REITs
The Inflation Reduction Act's changes to investment tax credit rules will make it possible for real estate investment trusts to own solar facilities and also benefit economically from tax credits, but certain limitations remain, say attorneys at Mayer Brown.
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Cases Show Real-World Laws Likely Apply In Metaverse
Although much has been written about the so-called unprecedented legal issues raised by the metaverse, recent federal cases demonstrate that companies can expect metaverse activities to be policed and enforced much like they would be in the physical world, say attorneys at Crowell & Moring.
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Justices Poised To Reject Narrowing Unclaimed Property Law
After U.S. Supreme Court oral arguments in the so-called MoneyGram case — a dispute between Delaware and several other states over which has the right to about $300 million in unclaimed property — the court seems ready to rule against Delaware, but nuances of the court's reasoning will have a broader sweep, say attorneys at Alston & Bird.
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How High Court Could Change FBAR Penalty Landscape
On Wednesday, the U.S. Supreme Court will hear Bittner v. U.S., a case that will affect many people penalized for failing to file a Report of Foreign Bank and Financial Accounts, and there are important procedural implications should the government's position be reversed, say Reuben Muller and Andreas Apostolides at Cole Schotz.
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IRS Memo May Change IP Royalty Tax Prepayment Planning
A recent Internal Revenue Service advice memorandum finding a taxpayer was not permitted to prepay tax on contingent royalties after contributing intellectual property offshore is a noteworthy departure from earlier guidance that highlights potential differences between actual and deemed licenses, says William Skinner at Fenwick.
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What IRS Funding Increase Means For Taxpayers
The Internal Revenue Service will first use the influx of funding from the Inflation Reduction Act to address customer support and personnel issues, but with over half the money allocated to enforcement, corporations and high-net-worth individuals will face increased scrutiny, say Patrick McCann Jr. and Jasen Hanson at Chamberlain Hrdlicka.
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6 Tax Considerations For Life Sciences Collaboration Deals
Given recent IRS guidance and changes to certain tax rates and deductions, biotech and life sciences companies entering into collaboration agreements should assess several unique taxation issues affecting matters ranging from research and development expenditures to profit-sharing terms, say attorneys at Orrick and Andersen Tax.
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Rushed Multilateral Negotiations Caused Two-Pillar Tax Mess
Cracks appearing in the two pillars of the 2021 global tax plan stem from a multilateral tax policy process that rushed to issue rules without first resolving fundamental differences between countries or ensuring that the U.S., a key player, could implement them, says Jefferson VanderWolk at Squire Patton.
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Post-Litigation Refund Strategies To Defeat Class Certification
The Third Circuit's recent revival of the Duncan v. Governor of the Virgin Islands class action shows that defendants should strongly consider tendering refunds to class representatives — even after they file suit — to create a substantial obstacle to certification, say attorneys at Covington.
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Key Considerations For Seeking Relief From Double Taxation
Caroline Setliffe and E. Miller Williams at Eversheds Sutherland lay out the Organization for International Cooperation and Development’s mutual agreement procedure for settling double-taxation disputes, and discuss six factors U.S. taxpayers doing business in multiple countries should consider when determining the most advantageous form of relief.
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High Court Could Resolve Thorny Atty-Client Privilege Issue
The U.S. Supreme Court recently granted review in a federal grand jury proceeding that presents a rare opportunity to clarify — and possibly significantly expand — the scope of the attorney-client privilege for complex mixed-purpose communications with counsel, says David Greenwald at Jenner & Block.
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2 Tax Decisions Hold Key Transfer Pricing Takeaways
Richard Slowinski and Stefanie Kavanagh at Alston & Bird discuss two recent decisions in cases against the IRS — Eaton Corp. from the Sixth Circuit and Medtronic from the Tax Court — that may help clarify when the agency can cancel an advance pricing agreement, but leave unanswered questions about which pricing method applies to high-value intercompany licensing transactions.
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Patagonia's Succession Plan Is A Blueprint For Biz Owners
While not every business owner is interested in giving their company away to a charitable purpose like Patagonia's founder recently did, the outdoor apparel company's unique situation highlights the considerations that should go into any succession plan, says Abosede Odunsi at Freeborn & Peters.