We help claimants submit whistleblower claims. But when we receive calls asking for help with whistleblower claims, we do everything we can to dissuade the callers from submitting claims. The IRS’s whistleblower program has been plagued by mismanagement. Cases have long been mishandled by the IRS. Legitimate awards denied. Claimants have to be prepared to…
Tax Articles
Using Contract Law to Avoid IRS Interest
Interest that accrues on taxes can be abated due to IRS errors or delays. The law that implements this general rule often fails to provide a meaningful remedy in most interest abatement cases. But what about contract law? Can contract law provide another means for obtaining a remedy in interest abatement cases? The court addresses…
IRS Contacts With Government Agencies
The IRS considers information from third parties during audits and in collecting unpaid taxes. The IRS’s efforts to gather this information can significantly harm the taxpayer, as third parties may not want to do business with the taxpayer given the IRS inquiry. Recognizing this, Congress has imposed rules that limit the IRS’s ability to make…
Property Rights & IRS Levies: Louisiana’s Usufruct
To determine whether the IRS can levy or take property, one has to consider what property the taxpayer owns. State law dictates what property the taxpayer owns. The property laws in most states are similar, which makes applying Federal tax collection law relatively easy. But then there is Louisiana law. Louisiana law differs in many…
The Tax Preparer’s Right to Appeal Return Penalties
The IRS has been focusing on tax return preparer audits. The aim of these audits is to impose penalties on tax return preparers. The IRS typically provides a means for tax preparers to appeal these penalties administratively, but there are cases where it doesn’t provide this opportunity. In those cases, the IRS will assess the…
S Corp Election Terminated by Standard LLC Language
If you make an S corporation election and do not fix the standard language that is typically included in the LLC company agreement, you’ll void the S corporation election. This is an issue that is usually identified by during an audit by the IRS. Many taxpayers overlook this issue until it is too late (it…
Can You Rely on IRS Statements?
If you ask someone a direct question and the person responds with incorrect information, is the person bound by their misrepresentation? This raises questions of “estoppel,” which apply to most litigants. But does it apply to IRS employees who make a misrepresentation? Put another way, can you rely on statements by IRS representatives? The court…
The Late Mark-to-Market Election
Those who trade stocks can take advantage of the mark-to-market election to convert capital losses into ordinary losses. This election is only available to “traders.” There are often questions as to when a taxpayers trading activities are sufficient to warrant being treated as a “trader” for tax purposes. By the time the taxpayer discovers that…
Substantial Authority, When the Authority is Not Clear
What if you have a tax question and find a court case that: (1) has the same facts as your case, (2) addresses the same tax item as in your case (such as a tax deduction, credit, etc.), and (3) the court case is decided in the taxpayer’s favor, but the court case does not…
About Tax Preparer Penalty Audits
The IRS’s power to regulate tax return preparers was limited by the Loving v. Internal Revenue Service, 742 F.3d 1013 (D.C. Cir. 2014) line of cases. These cases generally limit the IRS’s ability to regulate tax preparer conduct at an administrative level. But the IRS still has a number of tools at its disposal to…