Category: Tax

The concept of “judicial activism” refers to situations where judges do more than simply interpret existing laws. They venture into creating new laws or policies through their rulings. This encroaches on the legislative power of Congress, which creates the laws, and the executive agencies, which create policies to implement the law. This type of discretion……

Our legal system allows people to move on from past obligations under certain circumstances. For example, people can discharge debts through bankruptcy, creditors have a limited amount of time to sue for unpaid debts, and even the IRS allows a fresh start for unpaid taxes. These laws strike a balance between allowing those who are……

Timing issues are one of the aspects of effective tax planning. There are scores of options for timing and tax deferral and recognition that depend on the taxpayer’s circumstances. For example, for corporate taxpayers, these timing issues may involve timing the receipt of income using the installment rules or the use of losses or foreign……

One of the most common disputes between taxpayers and the IRS revolves around the question of whether certain expenses are deductible in the current year or need to be capitalized and recovered over time. This expense versus capitalization issue arises in various contexts. We have considered a number of these disputes on this site. It……

There are a number of legal principles that apply when it comes to civil litigation. Some of these rules apply in tax disputes and others do not. And tax disputes add other legal principles that are unique to tax. For example, our Federal tax system is premised on a concept of sovereign immunity where the……

Our tax administration operates within the framework of a zero-sum game, leaving little flexibility for taxpayers who encounter technical foot faults or minor errors. Even when taxpayers have complied with most of the tax law requirements, a single misstep can potentially result in the disallowance of a tax benefit or deduction. This zero-sum approach, while……

The IRS and Treasury face a number of challenges in administering our tax and financial systems. This includes challenges presented by foreign transactions by U.S. citizens and residents. In recent years, high-profile cases involving Americans using offshore accounts to evade taxes have prompted the U.S. government to crack down on tax evasion and make it……

So you reported a fictitious business on your income tax return. The fictitious business resulted in a tax loss and, maybe, you got a large tax refund from the IRS as a result of it. It’s a fraudulent tax return. The IRS sends you an IRS audit notice. What do you do? The answer varies,……

The voluntary nature of income tax returns in the United States means that taxpayers are responsible for reporting their income and paying the appropriate taxes. Taxpayers do this largely as it is the right thing to do. This is premised on a perception that the tax system has some elements of being fair and uniform……

The U.S. has significant and complex reporting and filing and notice requirements. This includes a myriad of state and local requirements and federal requirements, including income tax return filing requirements. As odd as it sounds, it is part of what makes America great. We often don’t think about it, but these filing requirements are part……