We know that we can take steps to minimize our taxes. Our tax laws allow for this and, on review, the courts have made this clear. Tax penalties are usually the problem with taking tax positions in situations that are not entirely clear. Taxpayers who find themselves having to make decisions in these gray areas…
Category: Accuracy Penalties
Accuracy Penalties
Penalties assessed for inaccuracies on tax returns, including substantial understatement penalties and negligence penalties. Give us a call to see how we can help, (713) 909-4906.
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…
Written Manager Approval for Penalties
An IRS agent is generally required to get written approval from their manager for a tax penalty can be assessed. This is requirement is set out in the Code. This begs the question as to what happens if the agent does not get written approval before he closes the audit? The court addressed this in…
No Tax Penalties for Obscure Tax Forms
The adage ‘Bad facts can create bad law’ applies to IRS penalties, where the agency typically removes penalties for most taxpayers with strong factual support at the administrative level. Court cases lacking strong facts often result in litigation, leading to numerous court cases where the government prevails. While it is uncommon for taxpayers to succeed…