No Good Deed Goes Unpunished - Loan by Physician/Owner to Medical Practice for Payroll Triggers Trust Fund Penalty... [ read ]
As the old adage goes, no good deed goes unpunished. In McClendon vs. United States, decided on November 17, 2016, the federal district court for the Southern District of Texas upheld the IRS' trust fund penalty assessments against a good-Samaritan doctor who, following another employee's embezzlement of funds from the medical practice, loaned money to the practice so it could make payroll. The decision stands as an important reminder to taxpayers of the hair-trigger nature of trust fund penalty liability.
IRS Extends Disclosure Deadline for Certain Captive Insurance Companies... [ read ]
Last month, I blogged on the IRS' identification of Code Section 831(b) micro captives as "transactions of interest," which triggered an obligation by taxpayers and material advisors to formally disclose the details of their prior-year insurance transactions to the IRS by January 30, 2017 or otherwise face potential penalties up to $50,000.
IRS Finalizes Documentation Requirements for Related-Party Debt: The Regulations and Their Effect on Closely-Held Corporations... [ read ]
In October of 2016, the IRS issued final regulations under IRC code section 385. The final regulations cover a number of issues under Internal Revenue Code ("IRC") section 385. IRC section 385 deals, in general, with whether an interest in a corporation should be treated as stock or debt for federal income tax purposes. The purpose of this article is to discuss the documentation requirements under Treas. Reg. § 1.385-2 for related-party debt and touch on what effect these requirements may have on closely-held corporations.
The IRS Adds Conservation Easements to the List of Tax Avoidance Transactions... [ read ]
On December 23rd the IRS issued Notice 2017-10 , which adds syndicated conservation easements to the category of transactions that require formal disclosure by investors and advisors to the IRS. Any taxpayer or advisor who is required to make a disclosure but fails to do so could face penalties of up to $50,000.
2016 Year-End Estate Planning (Video Included)... [ read ]
Now is the time to engage your clients in discussion regarding the status of their estate planning. Many items must be completed before year-end or they will be lost. Others simply need attention on an annual basis.
IRS Alternative Dispute Resolution Options... [ read ]
In a prior post, I talked about the latest IRS Alternative Dispute Resolution (ADR) program, Fast Track Mediation Collection, which replaced the prior Fast Track Mediation program. In this blog post, I want to talk about some of the other ADR programs that are available to taxpayers as an option for resolving tax disputes on an expedited basis.
Circumventing the Nexus Requirement: Colorado Law Imposing Sales Tax Obligations on Out-of-State Retailers is Upheld... [ read ]
On December 12, the U.S. Supreme Court denied the petition for certiorari in Direct Marketing Association v. Brohl (Direct Marketing). As a result, the Tenth Circuit's earlier decision in Direct Marketing will stand. In Direct Marketing, 814 F.3d 1129 (10th Cir. Feb. 22, 2016), the Tenth Circuit upheld a Colorado law requiring out-of-state retailers with no physical presence in Colorado to either voluntarily collect sales tax or comply with substantial notice and reporting requirements. At least arguably, the Colorado statute at issue represents yet another attempt by a state to circumvent the physical presence requirement imposed by the U.S. Supreme Court on a state's ability to impose its tax collection obligations on an out-of-state entity.
Investment Through Foreign-Owned Entities Just Got More Burdensome... [ read ]
Beginning January 1, 2017, foreign-owned single member LLCs—disregarded entities commonly used to invest in U.S. real estate—will have increased reporting and record keeping requirements.
IRS Introduces New Alternative Dispute Resolution for Taxpayers in Collection... [ read ]
On November 18, the IRS issued Rev. Proc. 2016-57 which provides guidance for the new Small Business/Self Employed (SBSE) Fast Track Mediation Collection (FTMC). The FTMC replaces the SB/SE Fast Track Mediation which was infrequently used and is now obsolete.
The IRS is Considering Adding Conservation Easements to the List of Tax Avoidance Transactions... [ read ]
Conservation easements are legitimate and very good tax planning transactions for taxpayers who wish to preserve valuable land and wildlife habitats. If the conservation easement is done properly, a taxpayer may be able to claim a substantial charitable contribution deduction pursuant to Section 170. However, due to inflated appraisals, poorly drafted documentation, improper deductions and unscrupulous promoters, the IRS is considering adding syndicated conservation easements to its catalog of "listed transactions".
