Federal
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February 26, 2024
Ex-Bank CFO Cops To $700K Theft And Life Insurance Scam
An ex-Eastern International Bank chief financial officer has pled guilty to defrauding the bank out of more than $700,000 to pay his personal expenses, and he admitted to opening life insurance policies in the names of bank employees to benefit his wife, according to the U.S. Department of Justice.
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February 26, 2024
US Can Bring Quick Appeal In Donor Reporting Rule Fight
The federal government can immediately appeal a ruling that would require it to prove a strong governmental interest in forcing nonprofits to report their major donors, an Ohio federal court decided Monday, saying there's significant room for a difference of opinion on the matter.
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February 26, 2024
Wealth Taxes Bring In Small Part Of G20 Revenue, Oxfam Says
Roughly 8% of tax revenue collected by Group of 20 countries is raised from wealth taxes on average, compared with over 32% from taxes on goods and services, anti-poverty group Oxfam said Monday ahead of a G20 meeting in Brazil.
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February 26, 2024
Inmate, 8 Others Charged In Trafficking, Tax Fraud Schemes
A California prison inmate has been charged along with eight other individuals with operating two separate illegal schemes: one to distribute methamphetamine and another to fraudulently claim over $550 million in COVID-19-based tax credits.
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February 26, 2024
More Analysis Needed In Lithium Pricing Guide, Groups Say
Functional analysis of multinational corporate groups should be included in a list of factors that could highly influence market prices within a transfer pricing framework for lithium, industry groups and accountants told the OECD in letters published Monday.
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February 26, 2024
Estate Correctly Taxed On Insurance Payout, Justices Told
The U.S. Supreme Court should affirm a decision denying a tax refund to the estate of an owner of a building materials company that used a payout from his $3.5 million life insurance policy to purchase his shares in the business, the federal government argued.
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February 23, 2024
FTC Rips H&R Block's 'Deceptive' Marketing, 'Coercive' Ploys
The Federal Trade Commission filed an administrative complaint against H&R Block claiming the tax preparation company deceptively marketed some products as "free" and "coerced" people to pay for pricier products, the government agency announced Friday.
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February 23, 2024
'Empire' Star Owes Income Tax After Threatening DOJ Atty
"Empire" actor Terrence Howard owes more than $900,000 in federal income taxes under a default judgment by a Pennsylvania federal judge that follows a monthslong search by the government to notify the actor of the suit, during which he threatened a government attorney.
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February 23, 2024
UN Tax Pact May Need OECD Nations' Support, Diplomats Say
The United Nations' global tax convention will likely require adoption by many advanced economies to address corporate tax abuse effectively, diplomats said, after countries resolved to pursue consensus over the long term but retain majority rule while drafting its terms of reference.
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February 23, 2024
Lead Pipe Replacement Not Taxable, IRS Says
The government-triggered replacement of lead service lines on residential property is not considered taxable income, the Internal Revenue Service said Friday.
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February 23, 2024
With Interest, Trump Now Owes $454M For NY Valuation Fraud
Donald Trump owes New York state nearly a half billion dollars after a county clerk on Friday tacked on $99 million in interest linked to a $355 million judgment in the state attorney general's civil fraud case against the former president last week.
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February 23, 2024
IRS To Open Grant Application Period For Low-Income Clinics
The Internal Revenue Service will accept applications for low income taxpayer clinic grants starting Monday, the agency announced Friday.
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February 23, 2024
IRS Reopens Comment Period For Education Tax Proposals
The Internal Revenue Service is reopening the comment period for certain education-related tax treatment standards originally published in 2016, the agency announced Friday.
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February 23, 2024
Weekly Internal Revenue Bulletin
The Internal Revenue Service issued its weekly bulletin Friday, which included updated figures for calculating employer health coverage penalties in 2025.
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February 23, 2024
Taxation With Representation: Gibson Dunn, Wachtell
In this week's Taxation with Representation, two asset managers invest in AITi Global, Chord Energy Corp. buys Enerplus Corp. and Truist sells an insurance subsidiary to an investor group led by private equity firms.
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February 23, 2024
Pot Rescheduling Could Spur Inventory Accounting Change
If cannabis is reclassified to a lower tier under the Controlled Substances Act, it would unlock significant tax benefits for cannabis companies, such as allowing them to take standard business deductions, but they may need to account for their inventories differently to take full advantage.
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February 22, 2024
Attys Settle Yacht Donor's Malpractice Suit Over $4.6M Tax Bill
A New York law firm and two attorneys have settled what remained of a malpractice suit brought by a former client who alleged faulty legal advice led to her being slapped with a $4.6 million tax bill, with a joint stipulation of dismissal filed Thursday.
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February 22, 2024
US Can't Appeal Order To Give Avenatti's Tax Info To Trustee
A California federal judge declined Wednesday to allow the U.S. to appeal a bankruptcy court's decision ordering Michael Avenatti's tax returns to be released to the trustee overseeing the estate of Eagan Avenatti LLP's bankruptcy, finding the decision to be unappealable, and Avenatti himself hasn't objected to the disclosure.
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February 22, 2024
Conn. Embezzler Gets 2 Years For $1M Mom-And-Pop Ripoff
The former office manager for a family-owned construction business in Connecticut must serve 24 months in prison for stealing nearly $1 million from her employer through a yearslong embezzlement scheme and failing to pay taxes on the money, a federal judge has ruled.
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February 22, 2024
Energy Credit's Cost Exclusions Flout Congress, IRS Told
The U.S. Treasury Department and Internal Revenue Service flouted congressional intent in proposed rules for the advanced green energy manufacturing tax credit by putting forth production cost exclusions, including for direct and indirect material costs, businesses and industry groups said Thursday.
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February 22, 2024
Pillar 2 Could Clash With US Double-Dipping Loss Rules
The Pillar Two international minimum tax agreement involves calculations that could trigger long-standing U.S. rules that are designed to prevent companies from what is known as double-dipping the same economic loss, raising questions about how upcoming regulations will navigate these two systems.
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February 22, 2024
IRS Agent, Gov't Attys Immune From RICO Suit, Judge Says
An Arizona federal judge dismissed a $15 million lawsuit against an Internal Revenue Service agent and two assistant U.S. attorneys brought by an investment adviser convicted of filing false tax returns, saying Thursday the government employees were immune from claims that included racketeering and malicious prosecution.
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February 22, 2024
Convicted Chicago Pol Seeks Acquittal Or New Trial
One of Chicago's longest serving and most powerful local politicians asked an Illinois federal judge Wednesday to set aside a jury's December verdict convicting him of using his official position to steer tax business to his personal law firm, saying no rational jury could have convicted him based on the evidence presented at trial.
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February 22, 2024
IRS Failed To Investigate Tax Exemption Abuses, Justices Told
A group claiming the IRS has ignored abuses of tax-exempt status by certain issuers of mortgage-backed investments asked the U.S. Supreme Court to review a ruling affirming the agency's discretion, saying billions of dollars in taxable income are at stake.
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February 21, 2024
Irish Pub Chain's Ex-CFO Gets 1.5 Years For $1M Tax Fraud
The former chief financial officer of a pub chain with more than a dozen Irish-themed restaurants was sentenced to one and a half years in prison Wednesday by an Ohio federal court for his role in a bookkeeping scheme that defrauded eight states of $1 million in sales taxes.
Expert Analysis
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Navigating The IRS Pre-Audit Retirement Plan Pilot Program
The Internal Revenue Service launched a Pre-Examination Compliance Pilot program for retirement plans last month that gives sponsors and administrators 90 days to self-correct errors and avoid audits, and while several details are unclear, there are important steps to take at this time, say attorneys at Ice Miller.
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Key Takeaways From IRS Reversal On FDII Stance
The Internal Revenue Service's recent memo regarding allocation of deferred compensation expenses for purposes of foreign-derived intangible income is a departure from the agency's previous position and may have implications beyond the context of deferred compensation, say attorneys at Miller & Chevalier.
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How To Address Research Expenditures Amid Uncertainty
Taxpayers need to prepare for the significant technical and compliance challenges of following Internal Revenue Code Section 174's new rules for experimentation expenditure capitalization and amortization, notwithstanding the rules' unresolved legislative future, say tax advisers at Grant Thornton.
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LeClairRyan Bankruptcy Highlights Pass-Through Tax Issue
A Virginia bankruptcy court's recent ruling in the case of defunct law firm LeClairRyan shows there may be serious tax consequences for pass-through entity partners who give up their ownership interest without following operating agreement exit provisions and updating bankruptcy court filings, say Edward Schnitzer and Hannah Travaglini at Montgomery McCracken.
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Tax, Social Services And The Need For An IRS Overhaul
Revamping the Internal Revenue Service should start with visibly improving taxpayer experiences to help pave the way for other fundamental changes needed to address the recent drop in audit numbers, personnel losses, burdens of its increasing expansion into social services and other problems, says Rice University fellow Joyce Beebe.
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Key Legal And Regulatory Trends In Oil And Gas Transactions
Excerpt from Practical Guidance
Attorneys involved in oil and gas transactions must be aware of important legal and regulatory trends that have emerged recently, including issues surrounding hydraulic fracturing, climate change, pipeline tariffs and a resurgence of regulation under the Biden administration, say Justin Hoffman and Thomas Blackwell at Baker Botts.
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Employer Considerations For Leave Donation Programs
As the battle for talent continues and workers return to the office, companies may consider allowing employees to donate accrued leave time to a shared bank, but employers should first review these programs' complex design issues to comply with state laws and avoid tax consequences, says Rebecca Hudson at Holland & Hart.
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Crypto Cos. Should Prep For More IRS John Doe Summonses
In anticipation of new reporting requirements that will go into effect in 2024, cryptocurrency exchanges and custodians should inform themselves on the John Doe summons, a unique mechanism that allows the IRS to obtain expansive information about cryptocurrency transactions, say Shivani Poddar and Andrew Heighington at Herrick Feinstein.
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Employer Travel Benefits Options For Abortion Care Post-Roe
Given the likelihood that Roe v. Wade will be overturned, and with the proliferation of state legislation restricting abortion access, employers may want to consider the legal implications of several options to expand travel reimbursement benefits for employees who seek abortion services, say Danita Merlau and Ben Conley at Seyfarth.
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Global Tax Chiefs Should Look To US Whistleblower Programs
As the Joint Chiefs of Global Tax Enforcement develops its international whistleblower program to address tax evasion and money laundering schemes in new areas like cryptocurrency, it should take lessons from highly successful U.S. programs on which features to include and pitfalls to avoid, say Neil Getnick and Nico Gurian at Getnick & Getnick.
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Crypto Investors May Face Increasing State FCA Tax Liability
Cryptocurrency investors who fail to report the state tax consequences of transactions are poised to encounter increased civil or criminal legal exposure as a growing number of states bring tax fraud under the purview of their whistleblower statutes, say attorneys at Brownstein Hyatt.
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Justices' Boechler Ruling May Spell Tax Exceptionalism's End
By basing its decision on cases outside the tax arena, the U.S. Supreme Court treated Boechler v. Commissioner as an administrative law case rather than a tax case and stripped away the traditional lines of tax exceptionalism, says James Creech at Baker Tilly.
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MORE Act's Possible Impact On State-Licensed Cannabis Cos.
The Marijuana Opportunity Reinvestment and Expungement Act, recently passed in the U.S. House of Representatives, would dramatically alter the federal legal landscape for state-licensed cannabis businesses in both positive and negative ways — from opening new marketing avenues to compounding tax burdens, say attorneys at the Law Offices of Omar Figueroa.