In Heinbockel v. Commissioner, T.C. Memo. 2013-125, the U.S. Tax Court considered a routine substantiation case and disallowed business expense deductions for a fashion clothing retailer. This case presents an opportunity to consider how to present routine substantiation cases to the IRS and to the courts. Facts & Procedural History Mrs. Heinbockel was in the… Continue reading Fashion Retailers Business Expenses Disallowed as Routine Substantiation Case
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.
Taxpayer Use of Estimates for Deductions
Can you use publicly available sources of statistical information when you have no records to support the amount of your expenses? The court addressed this in Murray v. Commissioner, T.C. Summary Opinion 2012-66, which involved the IRS’s use of third-party statics. Facts & Procedural History Mr. Murray worked as a truck driver for National Freight, Inc.… Continue reading Taxpayer Use of Estimates for Deductions
Court Determines What Truck Driving Expenses Are Deductible
In Nolder v. Commissioner, T.C. Summary Opinion 2012-50, the U.S. Tax Court examined a number of different expenses incurred by a truck driver to determine which expenses were deductible. This case provides a good overview of the typical expenses truck drivers incur that are and are not deductible. Facts & Procedural History Mr. Nolder was… Continue reading Court Determines What Truck Driving Expenses Are Deductible
Truck Driver Not Entitled to Deduct Meal and Supply Expenses
In Elsayed v. Commissioner, T.C. Summary Opinion 2009-81, the U.S. Tax Court reviewed meal and unreimbursed expenses incurred by a truck driver. This is a common tax problem for truck drivers. This case shows the difficulties truck drivers have in capturing and substantiating their expenses for tax purposes. Facts & Procedural History Elsayed was employed… Continue reading Truck Driver Not Entitled to Deduct Meal and Supply Expenses
Getting Interest Abated Can be Challenging
The IRS has the authority to abate or remove interest on tax liabilities; however, the process for getting the IRS to exercise this discretion can be challenging. The U.S. Tax Court describes this process in Select Steel, Inc. v. Commissioner, T.C. Summary Opinion 2008-79. Facts & procedural History In Select Steel, the taxpayer was required… Continue reading Getting Interest Abated Can be Challenging
Truck Driver Not Entitled to Deductions When Records Destroyed
In Clark v. Commissioner, T.C. Memo. 2007-172, the U.S. Tax Court held that a truck driver who did not file tax returns was not entitled to deduct expenses where his records were destroyed in a fire. Facts & Procedural History Mr. Clark was a truck driver. He was employed by Jimmy Harris Trucking, Inc., Vandy… Continue reading Truck Driver Not Entitled to Deductions When Records Destroyed
Substantial Compliance: Convincing the IRS to Look the Other Way
A professor can increase overall class scores for extra credit. A police officer is authorized to issue warnings for minor traffic infractions. What about IRS auditors? Do IRS revenue agents have this authority when conducting IRS audits? Our laws generally excuse minor infractions. This is often referred to as the doctrine of substantial compliance. The… Continue reading Substantial Compliance: Convincing the IRS to Look the Other Way
“We the People Foundation” Loses Court Battle, Wins Publicity
“We the People Foundation” recently lost yet another tax-related court case, but, perhaps wining in court is not really what the group is after. According to the court record, We the People have: engaged since 1999 in “a nationwide effort to get the government to answer specific questions” regarding what plaintiffs view as the Government’s… Continue reading “We the People Foundation” Loses Court Battle, Wins Publicity
Cash Payments Deposited by Salesman & the Form 8300
Cash-based businesses pose a number of problems for the IRS. They may also be involved in tax fraud. The Form 8300 allows the IRS to track cash payments for this very purpose. Chief Counsel Advice Memorandum 200707001 provides an example involving cash payments deposited by a salesman for a car dealership. Facts & Procedural History… Continue reading Cash Payments Deposited by Salesman & the Form 8300
5 Things to Prepare for an IRS Audit
The IRS audit rate is quite low. But lucky you, you have received an IRS audit notice. Fun stuff. So what do you do? Or what can you do to prepare? There are several things that you might start with. Before getting into those, let’s stop to think about how the IRS audit process. The… Continue reading 5 Things to Prepare for an IRS Audit