Federal
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June 26, 2024
IRS To Make Syndicated Easement Settlement Offers
The Internal Revenue Service will send settlement offers next month to some taxpayers who participated in syndicated conservation easement deals that the agency is auditing, it announced Wednesday.
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June 26, 2024
Advice Panel Calls For Regulating Noncredentialed Preparers
Congress should authorize the Internal Revenue Service to regulate noncredentialed tax preparers to protect taxpayers and the tax system from erroneous returns, the agency's Electronic Tax Administration Advisory Committee said in its annual report to lawmakers Wednesday.
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June 26, 2024
9th Circ. Revives $491K Refund Error Recovery Suit
The Ninth Circuit resurrected Wednesday an IRS suit that seeks to recover more than $491,000 from a taxpayer to whom the agency erroneously mailed a refund, reversing a lower court decision that dismissed the case for falling outside the two-year statute of limitations.
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June 26, 2024
5th Circ. Affirms Block On ARPA Tax Rule For Texas, La., Miss.
A Texas federal judge properly ruled that the federal government could not enforce a provision in the American Rescue Plan Act that prohibits states from using pandemic aid to offset tax cuts, the Fifth Circuit said.
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June 26, 2024
Man Denied Tax Breaks For Kids Who Didn't Live With Him
A Minnesotan does not qualify for tax exemptions or credits related to his three children because they did not live with him for at least half of the relevant tax year, the U.S. Tax Court said in an opinion released Wednesday.
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June 26, 2024
Device Maker To Fork Over $3.5M In Tax Dodge Suit
A man who manufactured a purported health device will pay the IRS nearly $3.5 million under an agreement endorsed by a Florida federal court after the agency claimed he hadn't filed a tax return since 1999.
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June 26, 2024
IRS Whistleblower Info Uncovered $338M In 2023, Report Says
The IRS more than doubled the amount of whistleblower awards it paid out in fiscal year 2023 compared with the prior year, distributing $88.8 million in awards attributable to information that led to the collection of $338 million, the agency said in a report.
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June 26, 2024
Fed. Circ. Denies Contractor's $37M Tax Reimbursement Bid
A U.S. State Department armed security contractor is not entitled to $37 million in reimbursement tied to tax payments to the Afghan government because the contractor's parent company, not the company itself, incurred the costs associated with the payments, the Federal Circuit said Wednesday.
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June 26, 2024
Medical Device Co. To Pay $935K Atty Fees In Tax Fraud Suit
A medical equipment company's leaders will pay $935,000 in attorney fees to investors' counsel after mediating a settlement in a proposed class action alleging the company breached fiduciary duty in failing to disclose its former CEO's involvement in a tax fraud dispute with Denmark.
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June 26, 2024
IRS Watchdog Urges Fix For ID Theft Victim Case Delays
Delays in resolving identity theft cases by an IRS victim assistance unit are getting worse and the agency must quickly fix the problem, National Taxpayer Advocate Erin Collins said in a report issued Wednesday.
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June 25, 2024
US Needs To Broaden Tax Base, Increase Rates, OECD Says
The United States' debt-to-gross-domestic-product ratio is the highest it's been since World War II, necessitating a wide range of tax changes to both expand the tax base and increase rates to alleviate fiscal pressures, the OECD said Tuesday.
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June 25, 2024
Tax Court Says Missed Deadline Doesn't Sink Its Jurisdiction
A jewelry company's one-day-late filing of a petition for reconsideration of an employment tax determination does not deprive the U.S. Tax Court of jurisdiction in the case, the court said Tuesday, denying the IRS' attempt to get the case tossed.
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June 25, 2024
Pension Plans Can't Escape $2B Danish Tax Fraud Dispute
Two U.S. pension plans made an "extremely strained" contention that Denmark's tax administrator waited too long to accuse them of participating in a $2.1 billion fraud scheme, a New York federal judge said in declining to toss the case.
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June 25, 2024
Ex-DOJ Atty Among New Trio At Chamberlain Hrdlicka
Chamberlain Hrdlicka White Williams & Aughtry has strengthened its tax controversy and litigation practice with the addition of three attorneys in Atlanta, including a former senior trial attorney in the Tax Division of the U.S. Department of Justice for more than three decades.
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June 25, 2024
IRS Apologizes To Hedge Fund Founder Over Leaked Tax Data
The IRS issued an extraordinary public apology Tuesday to hedge fund founder and billionaire Ken Griffin for the leak of his and others' tax information to the media by a former contractor who admitted to stealing the returns of thousands of wealthy individuals, including former President Donald Trump.
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June 25, 2024
House Bill Seeks 95% Windfall Tax On Excessive Profits
Large corporations would face a 95% windfall tax on excessive profits under legislation reintroduced in the House.
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June 25, 2024
Tax Pros Worry Credit Sales Could Raise Substance Issues
Tax professionals are concerned that deals involving a new way to sell clean energy tax credits for cash could face IRS scrutiny after the agency scored a high-profile win over a telecommunications company by deploying an aggressive interpretation of what's known as the economic substance doctrine.
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June 25, 2024
J&J Counsel Urges OECD To Ease Burdens Of Global Min. Tax
Counsel for Johnson & Johnson on Tuesday urged the OECD and government officials working on the Pillar Two global minimum corporate tax to consider more permanent safe harbor provisions to reduce the compliance burdens associated with the levy.
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June 25, 2024
Global Tax Overhaul Won't Squash Competition, US Rep. Says
The global tax overhaul designed by the Organization for Economic Cooperation and Development won't eliminate countries competing for companies' investments, a U.S. House lawmaker said Tuesday.
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June 25, 2024
Fla. Construction Co. Says It's Owed $4M In Worker Credits
A road construction company in Chapter 7 bankruptcy proceedings asked a Florida federal court to force the IRS to give it nearly $4 million in tax refunds for pandemic-era employee retention credits that its bankruptcy trustee determined it was eligible to receive.
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June 24, 2024
Billionaire Drops Case Against IRS Over Tax Info Leak
Billionaire hedge fund founder Ken Griffin dropped his case Monday seeking to hold the IRS accountable for the leak of his tax return information in a data breach that affected thousands of wealthy and powerful taxpayers, including former President Donald Trump.
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June 24, 2024
Tax Court Rejects Collection Appeal Over Amended Return
An IRS agent did not abuse his discretion when he didn't consider a supposed amended tax return that a Rhode Island woman said would lower her tax liability and therefore a proposed installment agreement amount, the U.S. Tax Court said Monday.
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June 24, 2024
Illinois, Other States Back FTC Bid To Affirm Intuit Ad Ruling
Illinois, along with 20 other states and the District of Columbia, defended the Federal Trade Commission in tax software giant Intuit's Fifth Circuit constitutional challenge to the agency's findings that the company engaged in deceptive advertising, saying in an amicus brief that the FTC's conclusion was correct.
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June 24, 2024
Ex-Chicago Alderman Gets Two Years For Boosting Law Firm
An Illinois federal judge on Monday sentenced former Chicago Alderman Ed Burke to two years in prison and fined him $2 million for using his official position to steer tax business to his personal law firm, closing what prosecutors called "another sordid chapter" in the city's history of public corruption.
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June 24, 2024
Better Digital Tax Ban In Pillar 1 Treaty, Treasury Official Says
The final text of a multilateral convention to implement the OECD-designed taxing rights overhaul will include improved language to eliminate existing digital services tax and prohibit prospective ones, a U.S. Treasury Department official said Monday.
Expert Analysis
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Cos. Should Heed IRS Warnings About Employee Tax Credit
The IRS has recently been cautioning employers claiming the pandemic-related employee retention credit to carefully review all the eligibility requirements and be wary of relying on third-party advisers regarding their qualification for the credit, say Eric Pearson and Timothy Voigtman at Foley & Lardner.
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Renewable Energy M&A Is Still Strong, Despite Challenges
The recent history of renewable energy has included ongoing supply chain issues, legislative challenges and rising interest rates — but mergers and acquisitions in the sector are expected to remain robust this year, fueled by growing demand and Inflation Reduction Act incentives, say consultants at FTI Consulting.
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Issues And Opportunities In Hydrogen Fuel Cell Development
A variety of tax incentives, funding opportunities and state programs have the potential to provide value across the hydrogen fuel cell business chain and alleviate existing hurdles, establishing a stronger business case for the continued development of hydrogen infrastructure, says Pamela Wu at Morgan Lewis.
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IRS Green Energy Tax Credit Notice Provides Needed Clarity
Recent IRS guidance clarifying how the government will determine energy community locations for purposes of bonus clean energy tax credits should help resolve risk allocation disagreements among financing parties and parties to merger and acquisition transactions, say Casey August and Paul Gordon at Morgan Lewis.
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SVB Collapse Highlights Ch. 11 Issues With Bank Holding Cos.
Amid recent banking turmoil, including Silicon Valley Bank's collapse and subsequent Chapter 11 filing of its parent company, distressed debt investors and board members must understand the distinct rules in bank holding company bankruptcies, including Bankruptcy Code provisions granting significant advantages to federal regulatory agencies like the FDIC, say attorneys at Skadden.
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9th Circ. Ruling Legitimizes Classwide Injury In Predominance
The Ninth Circuit's recent ruling that vacated class certification in Van v. LLR makes clear that the question of injury is highly relevant to the predominance analysis, and underscores the importance of making a persuasive argument that injury is individualized within the class, say attorneys at Skadden.
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IRS' Cost Method Update Is Favorable For RE Developers
The Internal Revenue Service's recent update to its alternative cost method will allow real estate developers to accelerate their cost recovery of improvements in certain circumstances and make it easier for practitioners to satisfy the method's tax compliance requirements, says Benjamin Oklan at Weil.
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The Key Issues Keeping Transfer Pricing A Top Tax Concern
Several challenges preventing a global economic reemergence from the pandemic era are making practitioners reevaluate commonly used transfer pricing models, and embrace new technologies and ways of doing business, say Farnaz Amini and Sophia Castro Jurado at Marcum.
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Cannabis Cos. Must Heed Growing Federal Investigatory Risks
As state-regulated cannabis markets expand rapidly, so too does government oversight, and industry participants must plan ahead to avoid potential liabilities related to workplace health and safety requirements, tax audits, securities regulations and foreign bribery laws, say Alicia Corona and Amy Rubenstein at Dentons.
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5 Ways Taxpayers Can Spot Employee Retention Credit Scams
On Monday, the Internal Revenue Service added the employee retention credit to its list of prevalent tax scams because of ERC promoters seeking to take advantage of employers, but taxpayers who may qualify for the credit can protect themselves by recognizing certain red flags, say attorneys at Potomac Law and Stout Risius.
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Could The Supreme Court Legalize Marijuana Federally?
Amid slow legislative and executive movement on cannabis reform, it’s worth examining whether the U.S. Supreme Court could provide a pathway to federal cannabis legalization — a decision that would surely require strange bedfellows given the court’s current ideological makeup, say Whitt Steineker and Mason Kruse at Bradley Arant.
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Tax Pitfalls To Avoid In Employment Litigation Settlements
Downsizing companies should keep certain questions in mind when settling claims with departing employees to ensure they understand associated tax withholding and reporting obligations, and avoid costly interest and penalties down the road, says Matthew Meltzer at Flaster Greenberg.
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Key Considerations For Taxpayers Deducting Crypto Losses
While a recent Internal Revenue Service memorandum is helpful in providing insight into how the agency is considering guidance related to cryptocurrency, questions remain with respect to whether a taxpayer can claim a tax deduction for cryptocurrency losses, say attorneys at McDermott.