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…
Category: Tax
Tax
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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.…
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…
Lessons Learned from Colorado’s Taxpayer Bill of Rights
Taxpayers’ Bills of Rights (TABORs) prevent state governments from increasing taxes or spending revenue growth without first obtaining voter approval. Several states are poised to adopt state TABORs in the near future. The State of Colorado adopted a TABOR in 1992. There are a number of lessons that other states can learn from Colorado’s TABOR…