Tax Law Blog
The U.S. Tax Court Can Order the IRS to Make Refunds
There are a number of forums for litigating tax disputes, such as the U.S. Tax Court. There are pros and cons associated with bringing suit in each forum. Taxpayers often pass on litigating cases in the U.S. Tax Court in cases when they are seeking a r…
Inference of Physical Sickness or Injury Not Sufficient to Exclude Settlement Payment
Settlement payments paid to compensate a taxpayer for his physical sickness or injury are not taxable. This rule has been heavily litigated. It often comes down to what proof there is of the physical sickness or injury. In Abraham v. Commissioner, T.C….
IRS Cannot Group Nonpassive Activities to Trigger Loss Limitation
Taxpayers are often surprised to learn that some losses may not be netted against gains in the current tax year. This is often due to the passive activity loss and material participation rules. The IRS National Office addressed these rules in TAM 20163…
IRS Audit Adjustments That Are Really Accounting Method Changes
Given the potential for the adjustments to trigger extremely large tax adjustments, accounting method changes made by the IRS on audit can be doomsday scenarios for unwary taxpayers. In Nebeker v. Commissioner, T.C. Memo. 2016-155, the court addressed …
Duty of Consistency Applied to IRS Lawsuit to Collect Unpaid Taxes
Many tax cases are won or lost based on tax procedure issues. The U.S. v. Holmes, Civil Action No. 4:15-cv-00626 (S.D. Texas 2016), case serves as a reminder of this. The case involved a lawsuit filed by the government in the eleventh hour and the duty…
Facts Needed to Abate Penalties Based on Reasonable Cause
Taxpayers often contest penalties by arguing that their failures were due to reasonable cause. Many of these penalty abatement requests are resolved at the administrative level. The cases that end up being litigated typically do not have the best facts…
The Start-Up Expense Limitation: Starting a Business in Retirement
There are several occupations where highly skilled individuals are forced to retire due to mandatory retirement provisions. These individuals often use their skills to start new businesses during retirement. The court addressed this situation in Tizard…
IRS Collections for U.S. Military Personnel
Judicial and administrative proceedings are temporarily suspended for those serving in the United States military. This includes a temporary hold on IRS collection actions. These laws are not provided in the Tax Code. Rather, they are set out in the Se…
Quotes: The IRS Does Not Have to Be Consistent
The post Quotes: The IRS Does Not Have to Be Consistent appeared first on Houston Tax Attorney: Texas Lawyer.
Unmarried Taxpayers Can Both Claim Mortgage Interest Deduction
In Voss v. Commissioner, 796 F.3d 1051 (9th Cir. 2015), the court addressed the rule that limits the deductibility of interest on home mortgages and home equity loans. This rule limits the amount of interest that can be deducted on mortgages in excess …