Articles

Articles

Practical writing on tax disputes, audits, appeals, collections, and tax planning.

  • About the IRS’s Whistleblower Program

    The IRS has the ability to pay you for information leading to the recovery of unpaid taxes. The payouts from the IRS’s “whistleblower” program can be significant. The payout can be up to 30 percent of the tax, penalties, and interest the IRS collects. There are a number of rules that have to be considered… Read →

  • Penalty Abatement for Reliance on Tax Advisor Who Made Obvious Errors

    The IRS often willing to abate or remove tax penalties. To do so, taxpayers usually have to show that they acted with reasonable cause and in good faith. Relying on a competent tax professional can be one way taxpayers can make this showing. But what exactly is a competent tax professional? The court addressed this… Read →

  • Two Years to File Refund Suit in District Court, Six Years in Federal Court of Claims

    If the IRS owes the taxpayer a refund, the general rule is that the taxpayer has to file a refund claim with the IRS, wait for the IRS to disallow the claim, and then, within two years of the date the claim is disallowed, file suit to recoup the refund. This is the general rule.… Read →

  • Ninth Circuit Says Taxpayer Must Use IRS Form

    Do taxpayers have to use the official forms published by the IRS? There are laws and administrative guidance that allow taxpayers to provide the information requested to the IRS without using the actual IRS form in some circumstances. In May v. United States, No. 15-16599 (9th Cir. 2017), the court considered whether a taxpayer is… Read →

  • U.S. Foreign Tax Credit Not Impacted by Repayment of Foreign Tax Refund

    The tax assessment and collection process in most foreign countries is markedly different than the process in the U.S. These differences can present a number of challenges for U.S. citizens who reside in foreign countries. In Sotiropoulos v. Commissioner, T.C. Memo. 2017-75, the court considered one of these challenges, namely, how does one determine whether… Read →

  • Court Considers Economic Substance in S Corp Transactions

    The IRS challenges some tax positions by asserting that the transactions lack economic substance. This can allow the government to unwind or ignore transactions that comply with our tax laws if there is no legitimate business purpose for the transactions other than tax savings. There is a growing body of court cases that helps define… Read →

  • Eight Things You Need to Know About the IRS Offer in Compromise Program

    An offer in compromise is a legal agreement between you and the IRS that settles your tax debt for less than the full amount you owe. It provides you with a path for paying off your tax debt and getting a “fresh start.” If you have unpaid tax debts, here are eight things you need… Read →

  • Rules to Know When the IRS Seizes Your Property

    The IRS has the authority to take your funds or property if you do not pay your taxes. This is commonly referred to as a “seizure.” Our Tax Code and the IRS’s Internal Revenue Manual provide specific rules and procedures the IRS has to follow to seize your property. Here are the four primary rules… Read →

  • When the IRS’s Collection Efforts Create an Economic Hardship

    The IRS has broad collection powers that it can bring to bear to collect unpaid taxes. Even though it has these powers, it often chooses not to use them. This is especially true in cases where the collection actions would result in an economic hardship for the taxpayer. What is an Economic Hardship? The term… Read →

  • 6 Tips for Avoiding the Trust Fund Recovery Penalty

    If you are running a business and it is not withholding or remitting payroll taxes to the IRS, you should be aware of the trust fund recovery penalty. This penalty can make the business’ payroll taxes your personal tax problem. The IRS is able to assess the penalty against you individually. That means that the… Read →

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