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The Tax Equity and Fiscal Responsibility Act of 1982 (“TEFRA”) procedures were intended to make it easier for the IRS to audit partnership tax returns. TEFRA failed to deliver. The rules are nuanced and hard to apply. The new partnership audit procedures are intended to remedy this. With the new partnership audit procedures coming online…
Tax Articles
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…Continue…
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…
Common IRS Collection Notices and What they Mean
Did you receive an IRS Collection Notices in the mail? If so, you either (1) opened it immediately as you had to know what the problem was or (2) refused to open it as you were hoping that the problem would go away on its own. Once you finally read the IRS Collection Notice, you……
Electing Small Tax Case Treatment in U.S. Tax Court
Taxpayers often handle cases in the U.S. Tax Court by themselves. This is typically the first time the taxpayer has been involved in a court case and the taxpayers are not familiar with the rules or how a court case is handled. Luckily, the U.S. Tax Court provides instruction on how to go about doing……
Can I Transfer Assets to Another Person If I Owe the IRS?
Taxpayers often ask us whether they can transfer property to another person if they have an unpaid tax debt or they expect to have a tax debt they cannot pay. There are a number of rules that have to be considered in answering this question. The answer varies based on whether the IRS has a……
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.…
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…
Can the IRS Contact Third Parties Without My Permission?
The IRS gathers quite a bit of information about taxpayers. This includes those who have unpaid tax debts and those who the IRS suspects may owe additional taxes. The IRS has the ability to contact third parties in gathering this information. There are rules that must be followed in doing so. When do the Rules……
Can I Get Interest on Unpaid Taxes Removed?
The IRS charges interest on unpaid tax, penalties, and interest. This interest can add up as time passes and the amount can be substantial. The IRS will abate or remove interest balances in certain circumstances, but it is up to the taxpayer to make this request. Even experienced tax professionals often forget about this remedy.……
