Tax Procedure Tax Returns

The Dilemma: File A Timely or An Accurate Tax Return?

If you have an ongoing dispute with the IRS for one or more years and the outcome of that dispute will impact the current year, can you take a wait and see approach to filing the current year tax return?   The Namakain v. Commissioner, T.C. Memo. 2018-200, case provides an opportunity to consider this question. Facts […]

Federal Income Tax Lottery & Gambling Retirement Accounts Tax

For Early IRA Distribution, Compulsive Gambling Not a Disability

Early distributions from IRAs are subject to a 10 percent additional tax.  The 10 percent additional tax does not apply if the distribution is taken when the IRA owner is disabled.  The recent Gillette v. Commissioner, T.C. Memo. 2018-195, case addresses whether medically-induced compulsive gambling qualifies as a disability. The Facts & Procedural History The taxpayer-wife is a […]

International Tax

FBAR Not Limited to $100,000, Willfulness Upheld

There have been a number of recent court cases involving foreign bank account or FBAR reporting penalties.  This is likely due to the significant amount of the penalty and that many do not fully appreciate the amount of the liability they face if caught not complying with the FBAR rules.  The recent Norman v. United […]

IRS Debts Tax Procedure

Perception Can Be As Important as Substance in Tax Disputes

Taxpayers voluntarily submit information to the IRS.  The IRS not only evaluates the substance of this information, but also the taxpayer’s candor in preparing and providing the information.  The perception of candor is just as important as the substance in many cases.  The Guess v. Commissioner, T.C. Memo. 2018-97, provides an example of how things can […]

Filing & Payment Penalties Tax Procedure

Court Rejects the ‘Taking All Necessary Steps’ Defense to Penalties

If you take all of the steps to prepare and remit a tax return to the IRS except for placing it in the mail, is this sufficient to avoid a failure to timely file penalty?  There is case law suggesting that it may be in some circumstances.  The U.S. Tax Court recently addressed this in […]

Tax Procedure Tax Returns

Some Filing Deadlines are Strict, Others are Not

When it comes to fixing tax problems, procedural footfaults can make solving the problem even more difficult. Filing deadlines are an example. The Duggan v. Commissioner, No. 15-73819 (9th Cir. 2018), case provides an example. Facts & Procedural History In Duggan, the taxpayer was contesting the IRS’s decision to proceed with collections. He requested a […]

Federal Income Tax

Court: IRS Cannot Apply New Law Based on Conduct Predating the Law

In Rafizadeah v. Commissioner, 150 T.C. No. 1 (2018), the court concluded that the IRS made a late assessment of tax and penalties. The case turns on whether the IRS can benefit from the longer six-year assessment period based on an information return filing that the law did not obligate the taxpayer to make at […]