A Different Type of Loan Fraud

Newsletter:  What it is and how it is gaining ground.
Published on December 29, 2009

Tread Carefully What CPAs Should Know About Tax Fraud

Article:  This article examines Sec. 6663 and the civil tax fraud penalty it imposes
Published on April 19, 2010

IRS Issues Optional Safe-Harbor Treatment for Victims of Ponzi Schemes

Article:  The IRS recently issued two rulings about the tax treatment of victims of Ponzi schemes and similar financial frauds
Published on January 28, 2011

IRS Issues Guidance on Losses from Ponzi Schemes

Article:  The IRS has released guidance on how investors who have fraud losses from a Ponzi scheme should treat their losses for tax purposes and has provided a safe harbor for taxpayers to use in determining the amount and the timing...
Published on January 28, 2011

Deducting Ponzi Scheme Losses Practical Issues

Article:  In March 2009, the IRS issued Rev. Rul. 2009-9 and Rev. Proc. 2009-20, which provided guidance on the tax treatment of theft losses from Ponzi-type schemes.
Published on July 13, 2012

FBAR Penalties Reduced for Six Months

Article:  The IRS has provided a framework for voluntary disclosure requests containing offshore issues, such as previously undisclosed foreign financial accounts and entities.
Published on January 28, 2011

Limitation Period for Equitable Innocent Spouse Relief Held Invalid

Article:  In a decision of the full court, the Tax Court held that Regs. Sec. 1.6015-5(b) (1), which imposes a two-year limitation period for requesting equitable innocent spouse relief, is an invalid interpretation of Sec. 6015(f).
Published on January 28, 2011

Deducting Losses for Defrauded Investors

Article:  This article considers theft losses “incurred in an activity engaged in for profit.” These investment theft losses are not subject to the 10% of AGI reduction for losses of personal use property, the 2% of AGI floor for miscellaneous itemized deductions, or the itemized deduction phaseout rules of Sec. 68.
Published on January 28, 2011

Tax Court May Not Disregard Findings of a Special Trial Judge

Article:  The Fifth Circuit held that the Tax Court did not give due regard to the findings of its special trial judge and ordered the Tax Court to issue a final order adopting the findings in that judge's report.
Published on July 06, 2010

Tax Court Vacates Stipulated Decisions in Tax Shelter Case

Article:  In the latest decision in one of its longest running series of cases, the Tax Court granted the motion of a group of taxpayers to vacate stipulated decisions in their cases that were part of the IRS’s Kersting tax shelter project.
Published on May 14, 2010

Partner Cannot Sue for Refund of Penalty Paid by Partnership

Article:  The Eighth Circuit reversed a district court and held that where a partnership paid a penalty under a closing agreement with the IRS, a partner in the partnership did not have standing to sue for a refund of part of the penalty payment.
Published on January 28, 2011

Ponzi Schemes The Implications for Defrauded Investors

Article:  The losses incurred in a Ponzi scheme may be deductible as theft loss under Sec. 165(a) as an ordinary deduction in the year the loss was discovered, with certain limitations. A taxpayer cannot deduct losses as long as there is a possibility of recovery and litigation is ongoing.
Published on January 28, 2011

Limitations on Taxpayers Ability to Disavow Tax Consequences of Contract Terms

Article:  The circuit courts have split on the issue of when a taxpayer should be able to disavow the form of his or her transaction and assert that the substance of the transaction controls.
Published on April 19, 2010

Taxpayer Not Allowed to Defer Income on Sale of Partnership Interest

Article:  A partner in a consulting partnership who received restricted stock in the sale of her interest in the partnership to a corporation and agreed by contract to report the full value of the stock in income in the year the stock was transferred could not defer including part of the
Published on January 28, 2011

Tax Practice and the Federal Criminal Code

Article:  Tax practitioners and taxpayers can be prosecuted for crimes under the criminal sections of the Internal Revenue Code and under the general criminal provisions in Title 18 of the U.S. Code.
Published on May 11, 2010