Categories
Business Tax C Coproration Tax Tax

Can the IRS Ignore the Legal Existence of a Corporation?

If a taxpayer forms a legal entity and it is taxed as a C corporation, can the IRS disregard the legal existence of the corporation and assess the corporation’s tax to the owner? The court addresses this in Russell v. Commissioner, T.C. Memo. 2019-146. Facts & Procedural History The taxpayer filed his personal income tax […]

Categories
C Coproration Tax S Corporation Tax Tax

The Importance of Accounting for C Corporation Expenses

It is important to keep accurate books and records. Accurate books and records can result in significant tax savings. This is particularly true for entrepreneurs who own more than one business. When one or more of these businesses are taxed as a C corporation, the stakes can be even higher. The Nzedu v. Commissioner, T.C. […]

Categories
Business Tax C Coproration Tax Tax

Does the IRS Have the Burden to Prove Constructive Dividends?

When a C corporation pays expenses for its shareholder, the payment can be subject to income tax for the shareholder as a constructive dividend. One defense is that the expenses for the C corporation were legitimate. Does the taxpayer have to prove the amount of the expenses or does the IRS? The Combs v. Commissioner, […]