Current Corporate Income Tax Developments (Part II) - 2010

Article:  During 2009, numerous state statutes were added, deleted, or modified; court cases were decided; regulations were proposed, issued, and modified; and bulletins and rulings were issued, released, and withdrawn. This article covers some of the more important developments in apportionment, unitary groups/filing methods, administration, flowthrough entities, and other significant corporate
Published on January 08, 2013

The Accuracy-Related Penalty (Part I)

Article:  This two-part article addresses the Sec. 6662 accuracy-related penalty and the defenses available to taxpayers. Part I provides an overview of the various bases upon which a Sec. 6662 penalty can be imposed.
Published on April 27, 2011

Passive Activity Grouping Disclosure Statements

Article:  Generally, a taxpayer may treat multiple trade, business, or rental activities as a single activity under the passive activity rules if the facts and circumstances indicate that they constitute an appropriate economic unit.
Published on January 28, 2011

S Corporation Basis Reductions for Nondeductible Expenses

Article:  When an S corporation has losses and deductions in excess of basis, some of which are nondeductible, noncapital expenses, will there be a carryover of the nondeductible items for purposes of reducing basis in a future year?
Published on January 28, 2011

Tax Court Rules on Valuation of Life Insurance Policy in Bargain Sale

Article:  The Tax Court held that where the profit-sharing plan of an S corporation wholly owned by the taxpayers distributed to them a life insurance policy on their lives, the taxpayers could not reduce the taxable value of the policy by the amount of the surrender charge for purposes of determining
Published on January 28, 2011

Consequences of S Corporation Termination in a Reorganization

Article:  An S corporation can participate as a corporate entity in a corporate reorganization; this leads to a substantive advantage of S corporations over partnerships
Published on January 28, 2011

Court Adopts Reason to Know Test for Innocent Spouse Cases

Article:  The Sixth Circuit adopted the “reason to know” test for determining whether a taxpayer was eligible for innocent spouse relief from tax liability for an understatement arising out of an erroneous deduction on a tax return.
Published on January 28, 2011

Protecting the Elderly from Financial Abuse

Article:  This column explores the warning signs of senior fraud and offers suggestions for identifying those signs and resources for guidance in handling such situations.
Published on January 28, 2011

Tax Court Allows Medical Deduction for Sex Change Operation

Article:  In a case of first impression, the Tax Court has held that a taxpayer can take a medical expense deduction for the costs of her sex change operation (O’Donnabhain, 134 T.C. No. 10).
Published on January 28, 2011

IRS Updates Rules on Adequate Disclosure

Article:  The IRS has updated its guidance on the rules governing when disclosure of an item or position on a tax return constitutes “adequate disclosure” for purposes of reducing an understatement of income tax or avoiding certain tax return preparer penalties.
Published on January 28, 2011

Fourth Circuit Upholds Return Preparer Conviction in RAL Wire Fraud Case

Article:  The Fourth Circuit has upheld the conviction of a Maryland tax return preparer for preparing false tax returns and for wire fraud, where the preparer used interstate wire communications to secure refund anticipation loans (RALs) for his customers .
Published on January 28, 2011

IRS Issues Guidance on GiftTax Consequences of Transfers in Trust

Article:  The IRS clarified for taxpayers that despite the provisions of Sec. 2511(c), the gift tax continues to apply to certain transfers to a wholly owned grantor trust.
Published on January 28, 2011

Assessment Period Remains Open in Partnership Case

Article:  In Blak Investments, the Tax Court applied Sec. 6501(c)(10) to extend the assessment statute of limitation for a taxpayer with an undisclosed listed transaction on a return due prior to October 22, 2004.
Published on January 28, 2011

Net Operating Loss and the IRS

Article:  Recent legislation lets taxpayers carry back a net operating loss (NOL) for a period of three, four, or five years. The IRS’s ability to make adjustments to the affected returns is an important consideration for taxpayers when deciding whether to make the carryback election and how many years to include.
Published on January 28, 2011

Circular 230 Best Practices

Article:  Circular 230, Section 10.33, on best practices deals with providing advice and preparing a submission to the IRS.
Published on January 28, 2011