Tax Procedure Archives

Court Determines What Truck Driving Expenses Are Deductible

In Nolder v. Commissioner, T.C. Summary Opinion 2012-50, the U.S. Tax Court examined a number of different expenses incurred by a truck driver to determine which expenses were deductible. This case provides a good overview of the typical expenses truck drivers incur that are and are not deductible. Facts & Procedural History Mr. Nolder was…

IRS Appeals Does Not Have to Hold Open CDP Hearing

Our system of income taxes is based on arbitrary deadlines. Income and expense are counted and tax computed on a set interval, whether calendar year, fiscal year, or a 52-53 week tax year. Tax returns are filed three, four, nine or ten months later. Audits have to be done within three years usually unless extended…

Innocent Spouse Relief Granted Despite Knowledge of Error on Return

Innocent spouse tax relief can provide a remedy for spouses who are liable for taxes reported on a jointly filed income tax return. It is an equitable remedy. But is it available if the tax is due to an obvious error on the tax returns that the spouses both signed? The court addressed this in Denton…

Truck Driver Not Entitled to Deduct Meal and Supply Expenses

Truck drivers are an essential part of our economy, transporting goods across the country to keep businesses running smoothly. Trucking expenses can add up quickly. This puts truck driver tax deductions high on the list of concerns for most truckers. Truck driver tax deductions are expenses that can be deducted from taxable income, reducing the…

Offer in Compromise: Documenting the Value of Assets

The IRS has a structured process for settling tax debts. This is handled through the IRS’s ‘offer in compromise’ program. The program itself has several different sections or workstreams. The primary workstream is the ‘doubt as to collectiblty’ workstream. This refers to offers that are submitted by taxpayers based on their inability to pay. Assuming…

Abate Tax & Penalties for 911 Attacks

Many taxpayers face unexpected challenges in their lives that can make it difficult to meet their tax obligations. For example, the death of a loved one or the trauma of a major event can have a significant impact on a person’s mental health and their ability to manage their finances. In such cases, individuals may…

IRS Guidance on Whistleblower Informant Program

The IRS whistleblower program provides financial incentives for individuals to report tax fraud and evasion. However, the program has drawn criticism for delayed payouts and lack of transparency in processing claims. Recently issued IRS guidance aims to improve procedures by detailing a multi-step review process. However, questions remain about administering reward payments. This article examines…

Reliance on an Incompetent Tax Advisor

The IRS often imposes penalties for various tax return errors and omissions. Taxpayers may defend against certain penalties by showing reasonable reliance on professional tax advice. However, the competence and expertise of the advisor are key, as highlighted in a recent U.S. Tax Court case, Wilson v. Commissioner, T.C. Summary Opinion 2008-91. The case considers…

Refunds After Innocent Spouse Relief Granted

Married couples who file joint tax returns are both liable for any deficiencies or underpayments. But if one spouse qualifies as an “innocent spouse,” they can be relieved of the tax burden. An important question arises – if an innocent spouse previously paid the joint tax debt, are they entitled to a full refund? A…

Discharging Tax Debts in Bankruptcy: The Three-Year Lookback Period

Tax debts in bankruptcy are a weighty and serious topic. Statistics show that in 2019, over 770,000 individuals filed for bankruptcy in the United States, and approximately one-third of those involved some type of tax debt. This highlights the common struggle individuals face in paying their tax obligations. Bankruptcy is a common method for resolving…