Federal
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June 12, 2024
Digital Taxes May Take Hold Regardless Of Treaty Signing
An internationally agreed-upon freeze on digital levies may continue to thaw even if countries meet their impending deadline to sign a related treaty for new corporate tax rules, in part because the accord faces a hazy path to formal ratification.
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June 12, 2024
Feds Strike Deal Ending $7M FBAR Penalty Cases
The U.S. government agreed to settle a pair of foreign bank account reporting cases in which it had sought a total of $7 million from a former insurance broker and his wife's estate, according to a court order filed Wednesday in California federal court.
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June 12, 2024
Groups Push Back On Stock Buyback Tax Test's Scope
The U.S. Treasury Department's proposed stock buyback tax rules go too far in trying to assess whether the main purpose of a U.S. subsidiary's funding purchase of its foreign parent's stock is to avoid the tax, two groups said in comments released Wednesday.
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June 12, 2024
St. Louis Atty Urges Acquittal After Tax Avoidance Conviction
A Missouri attorney who was found guilty of participating in a $4 million tax avoidance scheme alongside her father and a North Carolina insurance agent is looking to wipe out the verdict, arguing there wasn't enough evidence to convict.
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June 12, 2024
IRS Nix Of $45M Easement Deduction Invalid, Donor Says
A North Carolina partnership asked the U.S. Tax Court to invalidate an Internal Revenue Service adjustment that slashed its $45.6 million deduction for its donation of a conservation easement, saying the agency failed to follow proper administrative procedures.
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June 12, 2024
Treasury Issued Over $1B In Clean Vehicle Tax Credits
The clean vehicle tax credit of up to $7,500 has saved buyers more than $1 billion in total upfront costs since January, the U.S. Treasury Department announced Wednesday, saying the figures represent a major milestone in lowering transportation costs since the incentive was updated in 2022.
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June 12, 2024
First 'Survivor' Winner Wants $3M Tax Case Tossed
The winner of the first season of the TV series "Survivor" asked a Rhode Island federal court to toss the government's case against him seeking nearly $3.3 million in unpaid taxes, saying the liabilities stem from his flawed criminal conviction for tax evasion nearly 20 years ago.
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June 12, 2024
4 Taxpayer Advocacy Panel Committees To Meet In July
Four Taxpayer Advocacy Panel committees will hold public meetings in July focused on improving customer service at the Internal Revenue Service, the agency announced Wednesday.
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June 11, 2024
SVB Wants A Trial Over Its $605M Tax Bill From IRS
The parent company of failed Silicon Valley Bank has told a New York bankruptcy judge it wants him to decide if it owes the Internal Revenue Service more than $605 million in taxes.
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June 11, 2024
US Issues Sanctions For $50M Guyana Gold Tax Evasion
Two Guyanese businessmen and a Guyanese official were sanctioned by the U.S. Treasury Department on Tuesday after a probe into a corruption scheme that helped the businessmen evade $50 million in gold export taxes that should have been paid to Guyana's government, Treasury said.
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June 11, 2024
Trucks Don't Qualify For $400M Tax Exemption, 6th Circ. Told
A Tennessee company's refurbished trucks do not qualify for the safe harbor from the heavy-truck excise tax and should not be exempt from roughly $400 million in excise taxes, penalties and interest, the U.S. government told the Sixth Circuit.
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June 11, 2024
Aflac Matriarch's Estate Says IRS Missing Info In $11.7M Fight
The Internal Revenue Service's push to recover $11.7 million in deficiencies and penalties from the estate of the matriarch of the family that founded Aflac is predicated on a "mistaken understanding" regarding a trust, the estate told the U.S. Tax Court.
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June 11, 2024
Compliance Costs Outweigh Min. Tax Gains, Biz Reps Say
Multinational businesses are concerned that the burden of complying with the 15% global minimum tax outweighs any potential revenue gains associated with the burgeoning system, tax attorneys and a trade association representative said during a panel Tuesday.
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June 11, 2024
House Panel Chair Seeks To End Media Org's Tax Exemption
The House's top tax writer wants the Internal Revenue Service to revoke the tax-exempt status of a nonprofit Mideast-focused news outlet, telling Commissioner Daniel Werfel that the organization is aiding Hamas.
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June 11, 2024
Lawmakers Urge Biden To Back Brazil's Int'l Wealth Tax Plan
Sen. Bernie Sanders and Democratic lawmakers asked the Biden administration Tuesday to support the global minimum tax on billionaires being proposed by Brazil, which is encouraging the Group of 20 nations to endorse the initiative at its meetings next month.
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June 11, 2024
Kostelanetz Partners Talk Benefits Of Atlanta Tax Firm Tie-Up
Kostelanetz LLP partners Bryan Skarlatos and Todd Welty discuss the firm’s recent combination with Atlanta boutique Welty PC.
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June 11, 2024
Charity Founder Charged With Embezzling $2.5M, Evading Tax
The founder of a New York City charity embezzled $2.5 million in donations meant for low-income families and then failed to report the earnings to the Internal Revenue Service or pay tax on them, according to a criminal complaint unsealed Tuesday in New York federal court.
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June 11, 2024
IRS Schedules 3 Taxpayer Advocacy Panel Meetings For July
Three Taxpayer Advocacy Panel committees will hold public meetings in July focused on improving customer service at the Internal Revenue Service, the agency announced Tuesday.
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June 10, 2024
Ex-LA Chinatown Bank CFO Gets 3 Years For Embezzlement
The former chief financial officer of a bank based in Los Angeles' Chinatown has been sentenced to three years in prison after pleading guilty to bank fraud for embezzling more than $700,000 from his employer.
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June 10, 2024
Exec Wants IRS To Destroy Or Yield Docs In Summons Fight
The IRS should be forced to destroy or return bank records it obtained from a cryptocurrency executive charged in a 2020 bitcoin fraud investigation because the agency failed to notify him and his company of the summonses for the records, they told a Texas federal court Monday.
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June 10, 2024
Tax Court Rejects 'Shoebox' Method To Support Biz Expenses
The U.S. Tax Court rejected Monday the tax deductions that three California residents had claimed on their businesses' returns, saying their "shoebox" method of bundling receipts as evidence failed to substantiate their business expenses.
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June 10, 2024
Big Tech Urges US Reprisal Over Canada's Impending DST
The Office of the U.S. Trade Representative should open formal dispute proceedings with the Canadian government in response to a 3% digital services tax that is expected to soon pass in the Canadian Senate, business groups with members in the U.S. tech industry said Monday.
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June 10, 2024
IRS Needs Plan To Reduce Office Space, TIGTA Says
While the Internal Revenue Service has successfully decreased its unneeded office space by 8% since 2018, it needs a long-term space reduction plan with annual targets to efficiently continue to reduce its footprint, the Treasury Inspector General for Tax Administration said in a report released Monday.
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June 10, 2024
Judge Unseals Some Testimony Of Trump Tax Info Leaker
A federal magistrate judge on Monday ordered the unsealing of some testimony from a former IRS contractor about how he illegally gained access to former President Donald Trump's tax returns in a billionaire's case suing the agency over the breach.
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June 10, 2024
10th Circ. Affirms Couple Can't Ax $833K Income Tax Payment
A couple's wide-ranging arguments that the Internal Revenue Service should not have been allowed to assess that they owe over $833,000 in unpaid income taxes and penalties failed to sway the Tenth Circuit on Monday, as the court affirmed a ruling against them.
Expert Analysis
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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.
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Roadblocks For Cannabis Employers Setting Up 401(k) Plans
Though the Internal Revenue Code and the Employee Retirement Income Security Act generally allow cannabis businesses to establish 401(k) plans for their employees, companies must still pick their way through uncertainties around tax deductions and recruiting reliable vendors, say attorneys at Shipman & Goodwin.
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How Foreign Info Return Penalty Case May Benefit Taxpayers
The U.S. Tax Court's recent decision that the Internal Revenue Service cannot penalize taxpayers for failing to file foreign corporation information returns may give similarly situated taxpayers an opportunity to also avoid penalties, provided they protect their rights before the decision is overturned or mooted by legislation, say attorneys at Arnold & Porter.
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What's Unique — And What's Not — In Trump Protective Order
A Manhattan judge's recent protective order limiting former President Donald Trump's access to evidence included restrictions uniquely tailored to the defendant, which should remind defense attorneys that it's always a good idea to fight these seemingly standard orders, says Julia Jayne at Jayne Law.
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The Nuts And Bolts Of IRS Domestic Content Tax Credit
Recent IRS guidance provides specifics on how renewable energy projects can qualify for bonus tax credits by meeting U.S. domestic content rules, but also creates a qualification framework that will be complicated for project developers to navigate, say Scott Cockerham and Wolfram Pohl at Orrick.
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How Cities Can Tackle Post-Pandemic Budgeting Dilemmas
Due to increasing office vacancies around the country, cities may consider politically unpopular actions to avoid bankruptcy, but they could also look to the capital markets to ride out the current real estate crisis and achieve debt service savings to help balance their budgets, say attorneys at Cadwalader.
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Guidance Adds Clarity To Energy Communities Bonus Credits
Recent IRS guidance on the Inflation Reduction Act's changes to tax credits for renewable energy projects offers much-needed pointers for developers and financing parties, and should allow them to more comfortably incorporate special bonus credits for projects in energy communities into their transactions, say Jorge Medina and Ira Aghai at Shearman.
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Taxing The Digital Economy: The Good, The Bad And The Ugly
U.S. tech companies should watch for important developments in international taxation, including the resolution of Apple's decade-old state aid case, growing frustration with the Organization for Economic Cooperation and Development's global tax plan and adoption of the digital services tax instead, says Joyce Beebe at Rice University's Baker Institute for Public Policy.