Federal
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March 14, 2023
Chinese Couple's Fraud Charges In Poaching Case Tossed
A Texas federal judge dismissed wire fraud charges Tuesday against a Chinese couple accused of scheming to poach business from a U.S. Department of Defense contractor.
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March 14, 2023
Ex-Uber Exec Faces Setback In Bid For Tax-Free Settlement
A California federal judge on Monday reversed a bankruptcy court decision that relieved ex-Uber executive Anthony Levandowski from paying taxes on a settlement reached after he pled guilty to stealing trade secrets from his former employer Google, saying that the bankruptcy court made an "erroneous determination of what constitutes income."
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March 14, 2023
Tax Court Rejects Deferring US Tax On Retirement Accruals
A Canadian man can't defer U.S. tax on pre-distribution capital gains and interest from one of his three Canadian retirement accounts after the U.S. Tax Court partially sided with the IRS on Tuesday in finding he didn't properly make an election to defer tax.
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March 14, 2023
MTC Online Tax Guidance Headed For More Suits, Panel Says
The Multistate Tax Commission's updated guidance disqualifying many internet activities from the protections of P.L. 86-272, the federal law also known as the Interstate Income Act, has left many gray areas and continued legal challenges are all but certain, tax professionals said Tuesday.
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March 14, 2023
Texas Man Can't Deduct Vehicle, Travel Costs, Tax Court Says
A Texas man can't claim deductions for the business use of his vehicle, travel and other expenses after the U.S. Tax Court said Tuesday that he failed to sufficiently substantiate the claims.
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March 14, 2023
Missouri Man's Estate, Gov't Agree To End $230K FBAR Case
The representative of a Missouri man's estate stipulated to the dismissal of a federal case seeking $230,000 in foreign bank account reporting penalties from him, according to a filing made jointly with the U.S. government.
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March 14, 2023
La. Biz Owner Denied $2.6M In Added Expense Deductions
A Louisiana man cannot deduct over $2.6 million more in expenses for his welding business in 2011 than the amount already conceded by the Internal Revenue Service, the U.S. Tax Court said Tuesday.
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March 14, 2023
Russian Gas Co. Exec Must Share Bank Docs, Judge Affirms
A former executive of a Russian natural gas company who federal prosecutors say concealed $93 million in overseas accounts must turn over his Swiss bank records, a Florida judge ruled, finding no reason to undo a recent decision ordering him to share the documents with authorities.
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March 14, 2023
Feds Charge 7 In $111M IRS Tax Fraud Scheme
A federal indictment unsealed Monday in Texas named seven participants in an identity theft and tax fraud scheme that included at least 371 false returns claiming over $111 million in refunds, prosecutors said.
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March 14, 2023
Shifting Tax Landscape Drives Eversheds Sutherland Hiring
Following several partner additions in Washington, D.C., the head of Eversheds Sutherland's tax group said he's looking to fortify his team to help clients navigate an uptick in local and state enforcement and a major Internal Revenue Service funding boost that's expected to significantly grow its auditing capacity.
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March 14, 2023
Int'l Meetings To Reveal Pillar 1 Ambitions, EU Official Says
A top European Union official said Tuesday that international meetings will be key to gauging the ambition of major countries on implementing the first pillar of the Organization for Economic Cooperation and Development-led plan to change international taxation.
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March 13, 2023
4 Key Takeaways From OECD's Global Minimum Tax Guidance
The OECD’s recent administrative guidance provided some highly anticipated clarifications about the operation of an international minimum tax agreement while also creating some potential wrinkles, including how the global regime may interact with U.S. foreign tax credit rules. Here, Law360 examines four key takeaways from the administrative guidance for the second pillar of a corporate tax rewrite and what it could mean as countries implement the new rules.
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March 13, 2023
9th Circ. Vacates Class Cert. In LuLaRoe Sales Tax Suit
The Ninth Circuit on Monday vacated class certification for more than 10,000 Alaskan consumers accusing clothing retailer LuLaRoe of charging sales tax on their purchases in tax-free jurisdictions, ruling the district court did not properly consider that some customers received discounts to offset the sales tax.
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March 13, 2023
Tax Court Sustains Couple's 2016 Deficiency
The U.S. Tax Court sustained a tax deficiency of just under $6,000 against a couple for 2016, according to an opinion issued Monday.
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March 13, 2023
Estate Not Entitled To $352K Deduction, Tax Court Says
An estate can't claim a $352,000 charitable deduction for a transfer involving a subtrust, the U.S. Tax Court said Monday, finding the subtrust didn't constitute a charitable remainder annuity trust.
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March 13, 2023
Treasury Waiving Income Exclusion Criteria For 6 Countries
The U.S. Treasury Department will waive tax relief eligibility requirements for people who earned income in any of six countries it identified in a measure released Monday as facing conflict or other challenges in 2022.
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March 13, 2023
Gov't Seeks Early Win Over Tax Evader's $7M Bill
A man previously convicted of tax evasion and conspiring to defraud the IRS owes the agency nearly $7 million in taxes, penalties and interest, the U.S. told a Florida federal court, arguing it's entitled to an early win in its case against him.
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March 13, 2023
IRS Missed Biz Transcript Processing Deadline, TIGTA Says
The Internal Revenue Service didn't meet a deadline to enact an online system for processing business transcript requests, the Treasury Inspector General for Tax Administration said in a report released Monday.
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March 13, 2023
Investment Co. Agrees To Deals Ban In Easement Settlement
An investment group and its appraiser agreed to stop making deals involving deductions for qualified conservation easement contributions under a proposed settlement of a U.S. government lawsuit accusing them of running a $3 billion tax scheme, according to a filing Monday in Georgia federal court.
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March 13, 2023
Russian Ex-Gas Exec Protests Records Order In Tax Case
A former executive for a Russian gas company who's facing trial on charges he hid $93 million in overseas accounts challenged a federal magistrate judge's order to hand over his Swiss bank records by Monday, saying the judge ignored blatant violations of his Fifth Amendment rights.
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March 10, 2023
Full 9th Circ. Sides With IRS In Partnership's $35.5M Loss Row
The IRS timely disallowed a partnership's $35.5 million loss as the partnership's failure to strictly comply with filing rules meant the agency's readjustment deadline didn't pass, the full Ninth Circuit ruled Friday, overruling a three-judge panel.
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March 10, 2023
GOP Reps. Push Back Against Biden's IRS Funding Request
House Ways and Means Committee Republicans pushed back against President Joe Biden's requested $1.8 billion funding increase for the IRS during a hearing Friday, noting the agency hasn't even produced a spending plan for the funding boost it received last year.
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March 10, 2023
The Tax Angle: Corporate AMT, IRS Budget, Housing Credits
From a look at corporate book taxes and quarterly estimated payments to the Internal Revenue Service's budget and affordable housing, here's a peek into a reporter's notebook on a few of the week's developing tax stories.
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March 10, 2023
Ex-Kirkland Corporate Partner Rejoins Faegre Drinker
A former attorney with Faegre Drinker Biddle & Reath LLP has rejoined the firm as a partner in its corporate practice in Chicago after a stint at Kirkland & Ellis LLP, where he was also a partner, Faegre Drinker announced.
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March 10, 2023
Partnerships Urge Court To Toss IRS Easement Notice
A group of partnerships shouldn't have to comply with an IRS notice flagging certain conservation easement transactions as potentially abusive and requiring their disclosure because the notice didn't go through the notice-and-comment process, they told an Alabama federal court.
Expert Analysis
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A Close Look At The Decentralized Effort To Tax Digital Assets
Clarity on taxation is one of the biggest hurdles to mass adoption of cryptocurrency, and although digital asset innovation has consistently outpaced worldwide government regulation, recent efforts in the U.S. and elsewhere hint at an emerging standard, says Joshua Smeltzer at Gray Reed.
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Lessons From The SEC's Largest-Ever Audit Firm Penalty
The U.S. Securities and Exchange Commission's recent $100 million settlement over professional test cheating with Ernst & Young — the largest ever in an audit firm case — points to important ramifications for any entity responding to an SEC inquiry, say attorneys at Cleary.
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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.