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Utilizing a Relative's Unused Lifetime Exemption to Eliminate Capital Gains Tax
By on February 28, 2019
Fundamentally, estate plans are designed to pass assets to future generations as efficiently as possible. Nevertheless, it might be beneficial to employ an "upstream transfer" to eliminate built-in gains on highly-appreciated or income-producing assets. This technique achieves an income tax basis adjustment by purposefully causing inclusion of certain assets in an ancestor's non-taxable estate at death-thus utilizing a relative's lifetime estate and gift tax exemption that would otherwise be wasted. The assets then revert back downstream to the original owner or his descendants.
Appeals Court Holds That No Offer Is Too Low To Be A Qualified Offer
By on February 26, 2019
In a prior blog post we discussed using a Qualified Offer as a tool for settling a tax case with the government. On February 8th, the U.S. Court of Appeals for the Federal Circuit issued an opinion in BASR Partnership v. United States, holding that a partnership that prevailed in case against the IRS could recover its reasonable litigation costs from the government when it submitted a nominal $1 qualified offer.
By on February 14, 2019
In prior blog posts, we discussed the IRS using a summons to obtain information and options a taxpayer or third party has for responding to or objecting to a summons. In this blog post we will discuss an additional tool the IRS has to obtain information, a Formal Document Request ("FDR").
Rental Real Estate Under Section 199A Final Regulations
By on February 13, 2019
The Section 199A Final Regulations were released on January 18, 2019 and a corrected version was issued on February 1, 2019, with a few corrections and clarifications.
Section 199A Final Regulations Issued on Eve of the 2018 Filing Season
By on February 13, 2019
The Section 199A Final Regulations were released on January 18, 2019 and a corrected version was issued on February 1, 2019, with a few corrections and clarifications. In this blog post I will address some of the key items in the Final Regulations, as clarified, other than rental real estate, which I cover in a separate blog post.
Divorce Pleadings May Impact a Request for Innocent Spouse Relief
By on February 5, 2019
Generally, spouses who file a joint return are subject to joint and several liability for tax deficiencies under the Internal Revenue Code. Yet the IRS may grant a spouse relief from joint and several liability on a joint return in certain circumstances. One mechanism for obtaining relief from the general rule is to seek relief as an "innocent spouse" under 26 U.S.C. Section 6015(f), which authorizes the IRS to grant equitable relief from joint and several liability.
Still No Answer on Late Filing Penalty on Electronically Filed Tax Returns
By on February 4, 2019
In a blog post last year, we discussed the parties' oral arguments in the 5th Circuit Court of Appeal hearing in Haynes v. United States regarding the application of reasonable cause and a late filing penalty to an electronically filed tax return. On January 29th, the 5th Circuit issued an opinion in Haynes vacating the district court's grant of the government's motion for summary judgment and remanded the case to the district court for additional consideration. However, in vacating the lower court decision, the 5th Circuit declined to address the question of whether the U.S. Supreme Court decision in U.S. v. Boyle is still valid law in the age of electronic filing of tax returns.
