Federal
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July 10, 2024
Americans Overseas Ask for Clarity In Foreign Trust Regs
An advocacy group representing U.S. citizens living abroad urged the U.S. Treasury Department to clarify proposed rules for reporting transactions with foreign trusts, contending that guidance should explain which common pension arrangements are exempt from disclosure obligations.
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July 10, 2024
IRS Says Related Biz Arms Must Each Apply For Fuel Credit
Two related business departments that are both clean fuel producers and that have their own employer identification numbers must each apply on their own for the clean fuel production credit, the Internal Revenue Service said in an FAQ released Wednesday.
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July 10, 2024
Chevron's End Won't Affect Cubs Sale Tax Suit, 7th Circ. Told
An anti-abuse rule the IRS is using to push for taxes on gains from Tribune Media Co.'s sale of the Chicago Cubs is not threatened by the U.S. Supreme Court ruling overturning the Chevron deference doctrine, an attorney for the IRS told the Seventh Circuit on Wednesday.
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July 10, 2024
IRS Issues Electricity Credit Reference Price For Wind
The Internal Revenue Service released a 2024 reference price for determining the availability of the renewable electricity production credit for wind energy facilities in a notice issued Wednesday.
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July 10, 2024
House Dems Seek IRS Review Of Groups' Church Status
A group of House Democratic lawmakers asked the Internal Revenue Service to review the tax exemptions of conservative advocacy groups that they contend have improperly received tax-exempt status as churches, according to a letter released Wednesday.
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July 10, 2024
5th Circ. Told 'Pay To Litigate' Rule Doesn't Bar Refund Suit
A couple arguing the IRS failed to apply their tax overpayments to deficiencies claimed by the agency asked the Fifth Circuit to reverse a lower court's dismissal of their suit on the grounds that they hadn't paid their bill, saying the decision effectively asks them to pay twice.
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July 09, 2024
IRS Funding At Stake In 2025 Tax Cut Negotiations
Lawmakers are girding for battle over the soon-to-expire individual tax cuts in the 2017 tax law, and IRS funding will be central to the debate at a time when the agency may be in need of additional resources due to changes in law.
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July 09, 2024
House Panel OKs Tax Breaks For More Education Expenses
The House Ways and Means Committee sent several education-related tax bills to the full House of Representatives on Tuesday, including legislation that would make additional elementary and secondary school expenses eligible for tax-advantaged education savings accounts.
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July 09, 2024
Dems Request Special Counsel To Probe Justice Thomas Gifts
Two Democratic senators have asked U.S. Attorney General Merrick Garland to appoint a special counsel to investigate whether U.S. Supreme Court Justice Clarence Thomas' failure to disclose various gifts received during his tenure on the high court amounts to chargeable ethics violations or tax crimes.
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July 09, 2024
IRS Errors Foul $51M Levy, Calif. Man's Estate Tells Tax Court
The Internal Revenue Service made a slew of errors in determining a California man's estate faces a $46.2 million estate tax deficiency and a $4.6 million penalty, the estate's executor told the U.S. Tax Court.
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July 09, 2024
Veriwave Telco Faces FCC Action Over 'Tax Relief' Robocalls
The Federal Communications Commission is moving to block robocalls about purported "tax relief" programs from a Delaware-based telecommunications company, announcing in an order Monday that Veriwave Telco had another 14 days to demonstrate compliance with the agency's rules or risk having downstream providers cut its traffic.
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July 09, 2024
Senate Tax Panel To Consider 3 Tax Court Nominees
The Senate Finance Committee is scheduled to hold a hearing Wednesday to consider three U.S. Tax Court judge nominees, Sen. Ron Wyden, D-Ore., the panel's chairman, said in a statement Tuesday.
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July 09, 2024
5 Firms Steer $513M Ryan-Altus Cross-Border Tax Deal
Dallas-based tax services and software provider Ryan said Tuesday it has inked a deal to acquire the property tax business of Altus Group Ltd. for CA$700 million ($513.4 million), enlisting three firms to assist on a deal that will expand its footprint in Canada, the U.S. and the U.K.
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July 09, 2024
Medical Office Manager Gets 5 Years For Tax, Mail Fraud
The former office manager of an Illinois medical practice was sentenced to five years in federal prison and ordered to pay $3 million in restitution — most of it to his former employer — after admitting to filing a false tax return and stealing from the practice.
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July 09, 2024
Companies Deliberate Pillar 2 Prep After OECD Signals Relief
Multinational corporations facing the Pillar Two global minimum tax in various jurisdictions are weighing comments from OECD officials that hint at more relief as they decide whether to prepare to comply with the rules now or gamble on the prospects of permanent safe harbors.
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July 08, 2024
IRS Details Steps To Take For Scam-Credit Letter Recipients
The Internal Revenue Service published a fact sheet Monday to help taxpayers respond to letters from the agency identifying tax returns as requiring authentication after the agency said that inaccurate advice from social media and a series of scams led to an increase in questionable refund claims.
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July 08, 2024
Continued Worker Credit Freeze Could Push Cos. To Court
More employers tired of waiting for the Internal Revenue Service to process their employee retention credit refund claims could decide to go to court to force the government to review their submissions following the IRS announcing that a moratorium on processing new claims would remain in place.
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July 08, 2024
Ways And Means To Vote On Section 529 Tax Bills
The House Ways and Means Committee is scheduled to vote Tuesday on several education-related tax bills, including legislation that would make additional elementary and secondary school expenses eligible for tax-advantaged education savings accounts.
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July 08, 2024
Weekly Internal Revenue Bulletin
The Internal Revenue Service's weekly bulletin reported recently issued guidance on exceptions to the 10% additional tax for people who make permissible early retirement account withdrawals for emergency personal expenses and for victims of domestic abuse.
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July 08, 2024
IRS Failed To Analyze Storage Costs, TIGTA Says
The IRS didn't negotiate with the federal agency that stores its paper tax records, instead agreeing to pay a new monthly rate of $2.8 million without doing the required cost analysis, the Treasury Inspector General for Tax Administration said in a report released Monday.
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July 08, 2024
Top International Tax Cases Of 2024: Midyear Report
With a U.S. Supreme Court decision affirming a key 2017 tax provision on repatriation, millions of dollars in FBAR penalties upheld and a French ruling confirming the U.S. government's access to foreign bank accounts, the IRS stacked up important court victories on international enforcement in the first half of 2024. Here, Law360 reviews those and other significant rulings from the past six months.
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July 08, 2024
Atty Drops FOIA Suit Against IRS Over Partnership Audits
An Ohio attorney agreed to drop a public records suit against the Internal Revenue Service that had sought documents related to partnership audits after the agency released thousands of records he had requested, according to a D.C. federal court filing.
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July 08, 2024
IRS Must Produce Audit Records, Waste Co. Says
Garbage-hauling giant Waste Management Inc. asked a D.C. federal court to force the IRS to produce its tax files on the company for 2017, including audit records, saying the agency has been dragging its feet in violation of the Freedom of Information Act.
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July 08, 2024
Feds Seize $63M LA Estate Tied To Armenian Bribe Probe
The U.S. Department of Justice said Monday that it will seize a $63 million Los Angeles estate that it claims was bought with bribe payments for the family of a former Armenian government official.
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July 05, 2024
How Reshaped Circuit Courts Are Faring At The High Court
Seminal rulings from the U.S. Supreme Court's latest term will reshape many facets of American society in the coming years. Already, however, the rulings offer glimpses of how the justices view specific circuit courts, which have themselves been reshaped by an abundance of new judges.
Expert Analysis
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If Justices End Chevron Deference, Auer Could Be Next Target
If the U.S. Supreme Court decides next term to overrule its Chevron v. NRDC decision, it may open the door for a similar review of the Auer deference — the principle that a government agency can interpret, through application, ambiguous agency regulations, says Sohan Dasgupta at Taft Stettinius.
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Tax Court Ruling Provides Helpful Profits Interest Guidance
A recent U.S. Tax Court decision holding that a partnership may exclude interests in a company that it indirectly received sheds light on related IRS guidance, including the proper valuation method for such interests, though the court's application of the method to the facts of this case appears flawed, say attorneys at Kramer Levin.
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Mallory Ruling Doesn't Undermine NC Sales Tax Holding
Contrary to the conclusion reached in a recent Law360 guest article, the U.S. Supreme Court’s recent Mallory ruling shouldn't be read as implicitly repudiating the North Carolina Supreme Court’s sales tax ruling in Quad Graphics v. North Carolina Department of Revenue — the U.S. Supreme Court could have rejected Quad by directly overturning it, says Jonathan Entin at Case Western Reserve.
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IRS Criminal Probe Spells Uncertainty For Malta Pension Plans
The IRS’ recent scrutiny of Malta pension plan arrangements — and its unusual issuance of criminal administrative summonses — confirms that it views many of these plans as illegal tax evasion schemes, and the road ahead will not be smooth and steady for anyone involved, say attorneys at Kostelanetz.
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IRS Announcement Will Aid Cos. In Buyback Tax Planning
Recent IRS transitional guidance regarding current requirements for reporting and payment of the stock repurchase excise tax will help corporate taxpayers make decisions about records retention and establishing reserves for future tax payments, say Xenia Garofalo and Kyle Colonna at Eversheds Sutherland.
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Mallory Opinion Implicitly Overturned NC Sales Tax Ruling
The U.S. Supreme Court recently declined to review Quad Graphics v. North Carolina Department of Revenue, but importantly kicked the legs from under Quad's outcome a week later, stating in its Mallory decision that the high court has the prerogative to overrule its own decisions, says Richard Pomp at the University of Connecticut.
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How NIL Collectives Could Be Tax-Exempt After IRS Curveball
Since the Internal Revenue Service recently announced that numerous collectives creating paid name, image and likeness deals for collegiate student-athletes do not qualify for tax exemption, for-profit entities and alternative collective structures with incidental student-athlete benefits may be considered to fund NIL ventures, says David Kaufman at Thompson Coburn.
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Is This Pastime A Side-Gig? Or Is It A Hobby?
The recent U.S. Tax Court decision in Sherman v. Commissioner offers important reminders for taxpayers about the documentation and business practices needed to successfully argue that expenses can be deducted as losses from nonhobby income, says Bryan Camp at Texas Tech.
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Recent Provider Relief Fund Audits Are Just The Beginning
Though the Health Resources and Services Administration's initial audits of the Provider Relief Fund program appear to be limited in scope, fund recipients should prepare for additional oversight, scrutiny and disallowances as the HRSA ramps up its efforts, say Brian Lee and Christopher Frisina at Alston & Bird.
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Flawed Analysis Supports Common Law Tax Deficiency Ruling
The Colorado federal district court’s recent decision in Liberty Global, holding that the U.S. Department of Justice may assert a common law tax claim without the notice of tax deficiency required by the Internal Revenue Code, relies on a contorted reading of the statute and irrelevant case law, say Loren Opper and Christie Galinski at Miller Canfield.
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Review Of Repatriation Tax Sets Justices On Slippery Slope
The U.S. Supreme Court’s recent decision to review the constitutionality of the repatriation tax in Moore v. U.S. has implications for many tax rules involving unrealized amounts and could leave the court on the brink of invalidating large swaths of the Internal Revenue Code, say attorneys at Eversheds Sutherland.
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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.