The S Corp with an Evergreen PLR... [ read ]
A Private Letter Ruling is as close as you can get to certainty in the tax world. That's why the IRS charges up to $43,700 just to look at one. But so long as you don't misrepresent the facts, a PLR is a binding interpretation of current law on both the IRS and the courts. A favorable ruling can reduce tax-return disclosures and FIN 48 adjustments included in applicable financial statements, among other benefits.
AARs: Streamlined Corrections for BBA Partnership Returns... [ read ]
Amending tax returns is a necessary evil—sometimes. Correcting a return to add $15,000 of unreported income might not make sense to taxpayers if it costs $25,000 to amend, putting aside ethical and other considerations. But suppose it's an issue with an improper method of accounting.
Meadows Collier Partners Submit Comments on Proposed Revisions to Circular 230... [ read ]
Firm partners Jeffrey M. Glassman and Matthew L. Roberts, through their respective leadership positions with the State Bar of Texas Tax Section (Tax Section), recently submitted comments to the Treasury and IRS on proposed revisions to Circular 230. Mr. Glassman serves as the Chair of the Tax Controversy Committee for the Tax Section, and Mr. Roberts serves as the committee's Vice Chair.
Court Grants Taxpayers' Motion for Summary Judgment on Proposed Civil Fraud Penalty... [ read ]
If a taxpayer cannot resolve a dispute with either IRS examination or with the IRS Office of Appeals regarding tax and penalties, the IRS will send the taxpayer a Notice of Deficiency (NOD), sometimes referred to as a 90 Day Letter. A taxpayer has 90 days to dispute the NOD by filing a petition in the United States Tax Court. If a taxpayer does not file a timely petition with the Tax Court, the IRS will assess tax and penalties in the NOD plus applicable interest. If the taxpayer still wants to dispute the assessment, he must pay the liability, file a claim for refund and if the IRS denies the refund claim, file a refund suit in either U.S. District Court or the Court of Federal Claims.
The IRS is Targeting Partnership Basis Computations... [ read ]
In every recent IRS examination of a partnership and/or its partners in which I have been involved, the IRS has asked for information to support the computation of the partners' basis in the partnership. It is critical that a partnership maintain very good records to support the basis computations, especially if the partners are deducting partnership losses. In a recent Tax Court case, Langlois v. Commissioner, T.C. Memo. 2025-12, the taxpayer learned a hard lesson when the Tax Court ruled that the taxpayer had failed to establish his basis in his partnerships and not only denied the partnership losses but also imposed a 20% accuracy-related penalty.
The Importance of Preparing a Well-Written Targeted Protest to Avoid Liability for a Trust Fund Recovery Penalty... [ read ]
The Trust Fund Recovery Penalty (TFRP) is a significant tool used by the Internal Revenue Service (IRS) to collect unpaid trust fund taxes. These taxes include amounts withheld from employees' wages, such as income tax, Social Security, and Medicare taxes, which are held in trust by the employer until they are paid to the government
New Treasury Secretary Scott Bessent and SECA Taxes... [ read ]
Earlier this week the Senate confirmed Scott Bessent to serve as the next Treasury secretary by a vote of 68 to 29. Mr. Bessent is highly qualified to be the Treasury secretary and although he was easily confirmed, there was one area of inquiry which caused some concern, i.e. Mr. Bessent's use of the limited partnership exception under IRC Section 1402(a)(13) to avoid the Self-Employment Contributions Act (SECA) taxes related to his limited partnership interest in his hedge fund.
Taxpayer Refuses to Accept Incorrect IRS Determinations and Wins in Tax Court... [ read ]
Sometimes IRS auditors make mistakes. Sometimes those mistakes need to be challenged administratively with the IRS Independent Office of Appeals ("Appeals"). And when the mistakes remain unresolved after Appeals proceedings, litigating in court sometimes is necessary. That is a lot of "sometimes." But another one is warranted to point out that sometimes taxpayers who keep advancing legitimate arguments can be vindicated. This is one of those times—and an IRS conclusion that a taxpayer underreported its income by more than $500,000 was rejected by the United States Tax Court.
Appealing a Denial of an ERC Claim? Keep An Eye on the Statute of Limitations... [ read ]
If the IRS denies a taxpayer's claim for refund, the taxpayer can request that the IRS Office of Appeals ("Appeals") review the denial of the refund claim. If Appeals upholds the denial of the refund, pursuant to IRC Section 6532(a)(1), the taxpayer can file a refund suit in either United States District Court or the Court of Federal Claims challenging the denial of the refund claim. The suit must be filed no later than two years after the date on which the IRS mailed the initial notice disallowing the refund claim. A taxpayer who does not file a refund suit within two years of the refund being denied waives the refund claim.
Navigating the Employee Retention Credit: Key Issues from the Taxpayer Advocate's Report... [ read ]
The Taxpayer Advocate is an independent branch of the IRS that is statutorily required to identify areas where taxpayers have problems in their dealings with the IRS. One of the significant problems identified by the Taxpayer Advocate relates to ERC. Specifically, the Taxpayer Advocate's report highlights several key issues relating to ERC that have presented significant challenges for taxpayers. This blog drills down on the ERC issues highlighted by the Taxpayer Advocate.
