The IRS is prohibited from disclosing taxpayer information to third parties. There are a number of exceptions. But when the laws are violated, the courts can and do award damages to taxpayers. In Ward v. United States, 973 F. Supp. 996 (Dist. Colo. 1997), the court found that the IRS had violated the law by…
Tax Articles
Estate Tax Valuation Disputes (Explained)
Estate taxes are applied based on the value of assets that the decedent owned. Thus, unlike income tax which looks to sources of income, the estate tax focuses on the value of assets owned. This raises questions as to what the fair market value is for assets on the date the decedent died. Opinions can…
Can Bankruptcy Court Order IRS to Consider an OIC?
Have you ever found yourself in a situation where you were recognized as an expert, provided guidance or input on a matter, but then had a third party reach a different conclusion? If not, try to imagine yourself in such a situation. How would you react? Would you feel like your expertise had been undermined,…
U.S. Tax Court Violates It’s Own Rules
Do you know the feeling when you realize you are in a situation and you have no real remedy? If so, you probably also know the same feeling when you are in a situation where you are 100% right and there is a third party who is not. Most of us learn about these feelings…
Tax Consequences of Settlement Awards for Plaintiffs and Attorneys
When an individual receives a settlement award, the tax consequences of that award can vary depending on how it is structured. There are several tax planning opportunities available for individuals who receive settlement awards, but in most cases, the tax consequences are fairly standard. The case of Lindsey v. Commissioner, 422 F.3d 684 (8th Cir.…
Taxpayer Statements During Audit Admissible in Criminal Trial
When a civil tax case involves suspected criminal activity, the IRS conducts an initial investigation as part of an audit and may refer the case to the Department of Justice. Even when clear evidence of tax fraud has been obtained, the IRS revenue agent conducting the civil audit may continue to request information from the…
Better than a Soap Opera? Trust Fund Tax Disputes
One of the most important financial responsibilities for any business is the timely payment of taxes, including payroll taxes. Payroll taxes are the taxes that employers withhold from their employees’ paychecks and then submit to the government on their behalf. They also include the employer’s portion of the tax. While some businesses may be tempted…
Valuation Challenges and Pitfalls in Tax Cases
Valuing property for tax purposes is complex and can be a critical issue as it can result in significantly higher or lower taxes. The Garwood v. Commissioner, T.C. Memo. 2004-195, case offers a fascinating example of the challenges and pitfalls involved in valuation, particularly in the context of tax court cases. This case involved the…
The Sentencing Guideline Point System for Tax Crimes
Transactions can have a number of consequences. This includes criminal tax consequences–such as an IRS audit that goes criminal. Understanding criminal sentencing guidelines and how they apply to tax cases or could apply is part of the value the tax attorney brings to transactions. Tax-related crimes, such as tax fraud, can lead to criminal charges…
Congress Changes the IRS Offer in Compromise
The IRS offer in compromise (“OIC”) program is a tax resolution option offered by the IRS to help taxpayers who are unable to pay their full tax liability. It allows eligible taxpayers to settle their tax debts for less than the full amount owed, based on their financial situation and ability to pay. The OIC…