Taxpayers often regret agreeing to IRS audit adjustments. These agreements are not necessarily final when the paperwork is signed. The taxpayer typically still has time to change their mind. In Sandoval Lua v. United States, No. 2016-1313 (5th Cir. 2016), the court considered a case where the taxpayer changed his mind, but failed to act… Continue reading Getting Out of IRS Adjustments Agreed to on Audit
Category: IRS Audits
About IRS Audits
The IRS uses the audit process to increase the amount of tax you owe. It is an adversarial process and should be handled accordingly.
This page covers recent cases, rulings, and guidance for IRS audits. Scroll down to read the articles.
If you want to read more about IRS audits or see how we can help, you can read this page about IRS audits.
Otherwise, if you need help dealing with an IRS audit, please schedule an appointment with our tax attorneys online. You can also call us at (713) 909-4906.
IRS Closing Agreement Not Binding for “All” Tax Issues
A well-drafted closing agreement can provide a level of certainty to an uncertain tax position. The agreements do this by binding the IRS and the taxpayer. They normally include language that says that the agreements are valid for all Federal income tax purposes. In Analog Devices, Inc. v. Commissioner, 147 T.C. 15, the court concluded… Continue reading IRS Closing Agreement Not Binding for “All” Tax Issues
Can IRS Cure Defective Summons With Second Summons?
The administrative summons is one of the IRS’s primary tools for obtaining information from taxpayers and third parties. There are very few requirements that the IRS has to satisfy in issuing summones. In Maxcrest Limited v. United States, Case No. 15-mc-80270-JST, the U.S. District Court for the Northern District of California addressed whether the IRS… Continue reading Can IRS Cure Defective Summons With Second Summons?
Lost IRS Notice Was Timely, Despite IRS Not Following Procedures
There are a number of dates that must be met when it comes to taxes. Many of these dates are triggered by some action by the IRS. This raises the question as to what happens if the taxpayer is not aware that the IRS took the action and the IRS destroys the primary evidence that… Continue reading Lost IRS Notice Was Timely, Despite IRS Not Following Procedures
TIGTA Questions IRS’s Future State Reorganization
IRS has the power to decide who gets what, when, and how when it comes to federal taxes. Many of these decisions are made by IRS employees as part of examining tax returns. This is why we are all watching the IRS reorganize its audit function. The Treasury Inspector General for Tax Administration (“TIGTA”) recently… Continue reading TIGTA Questions IRS’s Future State Reorganization
How Long Do You Keep Your Tax Records?
Taxpayers often ask how long they have to keep their tax records. Many taxpayers only keep records for three to six years. In Reyonoso v. Commissioner, T.C. Memo. 2016-185, the court considered a case that turned on whether the taxpayer could produce records to support that he had made a mark-to-market election nearly twenty years […]
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How Long Do You Keep Your Tax Records?
Taxpayers often ask how long they have to keep their tax records. Many taxpayers only keep records for three to six years. In Reyonoso v. Commissioner, T.C. Memo. 2016-185, the court considered a case that turned on whether the taxpayer could produce records to support that he had made a mark-to-market election nearly twenty years… Continue reading How Long Do You Keep Your Tax Records?
Charitable Deduction With a Defective Valuation
There are a number of cases where taxpayers have had to pay more tax than they should due to technical foot faults. These cases often come up when the IRS auditors believe that their job is to look for strict compliance (100%) rather than substantial compliance (something more akin to 80%). This brings us to… Continue reading Charitable Deduction With a Defective Valuation
Taxes from IRS Audit Remitted to U.S. Virgin Islands
Taxes Remitted to the U.S. Virgin Islands in Error were Not Compulsory Payments in an Audit One of the common issues that comes up on audit is whether payments to foreign governments are creditable for purposes of the U.S. foreign tax credit (“FTC”). This often hinges on whether the payments were “compulsory.” There is little… Continue reading Taxes from IRS Audit Remitted to U.S. Virgin Islands
Extend Time for an IRS Audit
Agreeing to Extend the Time for an IRS Audit or Not? Congress provided a limited time for the IRS to audit tax returns. This time can be extended if the taxpayer agrees. While some taxpayers require the IRS to stick to the time provided by Congress, other taxpayers choose to extend the time period. This… Continue reading Extend Time for an IRS Audit