The IRS relies on mail to alert taxpayers of important events. It also relies on mail to provide notice that is required by the Code. Given the importance of these alerts and notices, taxpayers are often surprised to find out that there is no requirement that the taxpayer actually receives most IRS notices. The IRS… Continue reading The IRS’s “Last Known Address” Rule
Tax Articles
Taxes & Limited Liability Companies
The Limited Liability Company or LLC is a legal entity formed with the state. Once formed, taxpayers have the ability to determine how the LLC is taxed for Federal income tax purposes. This presents a number of issues that have to be considered for LLC owners. Income Taxes & LLCs The IRS regards a single… Continue reading Taxes & Limited Liability Companies
IRS Private Tax Debt Collection Agencies
The IRS spends a considerable amount of time and money trying to collect unpaid tax debts. There has been some thought that private collectors would have better results. Congress recently enacted Section 6306 to allow the IRS to assign certain delinquent tax accounts to private collection agencies. The new law and how it is implemented… Continue reading IRS Private Tax Debt Collection Agencies
State vs. Federal Tax Court Litigation
I often hear criminal attorneys say that they always have a good chance to win state criminal cases, but they are almost never able to win in federal criminal cases. The idea seems to be that federal agencies spend a lot more time and effort preparing and gathering evidence against the accused than do state… Continue reading State vs. Federal Tax Court Litigation
Estate Tax Valuation vs. Income Tax Valuation
The question in Janis v. Commissioner is whether a taxpayer can claim that property has a low value for estate tax purposes and then turn around and claim that the property has a high value for income tax purposes. The Ninth Circuit said “no,” but the answer could have been different under slightly different facts.… Continue reading Estate Tax Valuation vs. Income Tax Valuation
Recent Texas Tax Case is an Example of why Taxpayers Should Hire a Tax Attorney
Taxpayers often ask me why they should hire a tax attorney. My response is always that hiring a tax attorney to review and structure your financial affairs can give you some certainty that things are done right, in many cases it can save you significant amounts of tax and later IRS problems, and it can… Continue reading Recent Texas Tax Case is an Example of why Taxpayers Should Hire a Tax Attorney
The IRS Announces an Online Tax Payment Agreement System
The IRS recently announced that it will be launching a system to allow “tax professionals” to apply online for tax payment agreements or tax installment agreements for their clients. IRS Online Pro’s & Cons While this is a step in the right direction, it does present yet another opportunity to consider whether the IRS should… Continue reading The IRS Announces an Online Tax Payment Agreement System
Deposits vs. Payments: A Distinction Taxpayers Must Understand Before Making Payments to the IRS
There is a difference between making a payment and a deposit when you pay the IRS. Blom v. United States, a recent case in the Federal District Court of Pennsylvania, highlights the difference between an IRS tax deposit and an IRS tax payment. Facts & Procedural History Blom’s aunt died and named Blom as the… Continue reading Deposits vs. Payments: A Distinction Taxpayers Must Understand Before Making Payments to the IRS
Missing Form 1099 May Establish Reasonable Cause
If you do not receive a Form 1099 to report income to you and you omit it from your tax return, are you liable for penalties if the IRS later notices the issue and makes an adjustment? The Mabinuori v. Commissioner, T.C. Summary Opinion 2006-109, case provides an opportunity to consider this question. Facts & Procedural… Continue reading Missing Form 1099 May Establish Reasonable Cause
More on IRA Beneficary Designation Planning Opportunities
It is probably safe to say that most IRA owners really don’t put much thought into who they designate as their IRA beneficiary, but even IRA owners who do may very well have not done their planning correctly. This is especially true in that the IRA beneficiary designation rules are so complex. With traditional IRAs… Continue reading More on IRA Beneficary Designation Planning Opportunities