Income Statement Verified by a CPA Is Not Substantiation
Tax News Briefs

Income Statement Verified by a CPA Is Not Substantiation

For some types of expenses, lack of substantiation can be overcome. If a taxpayer establishes that a deductible expense has been paid but cannot establish the precise amount, the Tax Court may estimate the amount under the s... TheTaxBook

Recent Passport Cases in the Tax Court
Tax Court

Recent Passport Cases in the Tax Court

In 2015, Congress added §7345 to the Internal Revenue Code (IRC). Under §7345(a), if the Internal Revenue Service (IRS) certifies that a taxpayer has a “seriously delinquent tax debt,” a taxpayer may h... Thomas Gorczynski, EA, USTCP

Notice and Opportunity for Hearing Before Levy
Tax News Briefs

Notice and Opportunity for Hearing Before Levy

When tax remains unpaid, the Internal Revenue Service (IRS) may levy any property or right to property of the taxpayer to satisfy the tax liability. However, before such levy is made, the IRS must issue a notice to the taxpayer i... TheTaxBook

What Happens When a Tax Court Petition Is a Few Minutes Late?
Tax Court

What Happens When a Tax Court Petition Is a Few Minutes Late?

The United States Tax Court is a court of limited jurisdiction; it cannot consider every tax dispute in the United States. Historically, for the Tax Court to have jurisdiction over a specific matter, the Internal Revenue Code (IRC) must allow the Tax Court to review the Inte... Thomas Gorczynski, EA, USTCP

When Is a Return Considered Filed?
Representation

When Is a Return Considered Filed?

In Seaview Trading, LLC v. Commissioner,i a three-judge panel of the Ninth Circuit Court heard an appeal from the Tax Court, which tasked the court with deciding when a return ... Josh Youngblood, EA

If the IRS Timely Responded, Your Offer Is Not Deemed Accepted
Tax Court

If the IRS Timely Responded, Your Offer Is Not Deemed Accepted

Brown v. Commissioner, 158 T.C. No. 9 (2022) Brown has shined light onto a provision in the Internal Revenue Code (IRC) that asserts that an offer is deemed accepted 24 months after submission if not explicitly rejected.Ruben D. Valdes, EA, USTCP

Is a Remote Tax Court Exam Easier to Pass?
Feature Article

Is a Remote Tax Court Exam Easier to Pass?

Circular 230 practitioners know we cannot always resolve tax controversies in the Internal Revenue Service (IRS) administrative processes within the Examination, Collection and App... Sherrill Trovato, EA, USTCP

The PTC, Itemized Deductions, Employer Leave-Based Donation Programs, Tracking Refunds, and Bribes
Tax News Briefs

The PTC, Itemized Deductions, Employer Leave-Based Donation Programs, Tracking Refunds, and Bribes

Premium Tax Credit Regulations Amended Wages are deductible by a C corporation in computing taxable income, but dividends are not. In a closely held corporation, the owners might decide to take ... TheTaxBook

Important Things to Know for Tax Year 2021 Returns
Tax News Briefs

Important Things to Know for Tax Year 2021 Returns

Infrastructure Investment and Jobs Act On November 5, 2021, Congress passed the Infrastructure Investment and Jobs Act (H.R. 3684), which President Biden is expected to sign into law. The new law addresses provisions rel... TheTaxBook

Limited Partners and Self-Employment Tax
Feature Article

Limited Partners and Self-Employment Tax

As tax professionals, we are often given Schedule K-1 forms by our clients in order to report their income and/or losses from their investments in pass-through organizations. How involved are we, ... Keith A. Espinoza, EA

What Jurisdiction Does the Tax Court Have Over Passport Actions Under §7435(b)?
Tax Court

What Jurisdiction Does the Tax Court Have Over Passport Actions Under §7435(b)?

Vivian Ruesch, Petitioner v. Commissioner of Internal Revenue, Respondent 154 T.C. 13 | Filed June 25, 2020 Vivian Ruesch (154 T.C. 13 (6/25/20)) provides the first Tax Court guidance on Internal Revenue Code (IRC) §7345, captioned “Revocat... Sherrill Trovato, EA, USTCP

The Desirable (Yet Complex) Real Estate Professional Classification
Feature Article

The Desirable (Yet Complex) Real Estate Professional Classification

Being a real estate professional has its tax advantages, And the average landlord does not want to pass it up. But misusing the classification can unravel expected tax consequences. Investing in rental real estate can be a l... Thomas J. Williams, EA, and Iris K. Palma, JD

Is an Identity Protection Personal Identification Number a Required Element of a Taxpayer Signature for Purposes of the Assessment Statement of Limitations?
Tax Court

Is an Identity Protection Personal Identification Number a Required Element of a Taxpayer Signature for Purposes of the Assessment Statement of Limitations?

Robin J. Fowler (155 T.C. 7 (September 9, 2020)) answers the question of whether the Internal Revenue Service (IRS) can choose to reject a validly e-filed tax return because it is missing the identity protection personal identification number (IP PIN). T... Sherrill Trovato, EA, USTCP

How to Be Eligible for Substantial Tax Savings as a Trader
Feature Article

How to Be Eligible for Substantial Tax Savings as a Trader

There are tax advantages for traders who are eligible for trader tax status (TTS). This article provides an overview of how to qualify for TTS (no election is required): Automated trading systems can qualify for TTS, providing the trader is significantly involved ... Robert A. Green, CPA

Is Timely and Meaningful IRS Supervisor Approval Needed in Order to Assess Penalties?
Tax Court

Is Timely and Meaningful IRS Supervisor Approval Needed in Order to Assess Penalties?

Jesus R. Oropeza and Fabiola Anaya Oropeza, Petitioners v. Commissioner of Internal Revenue, Respondent T.C. memo, 2020-111 | Filed July 21, 2020 The Internal Revenue Code (the Code) requires the IRS to come forward with sufficient evidence that indicates the impositi... Steven R. Diamond, CPA, USTCP

What Constitutes Sufficient Notification to a Taxpayer When the Commissioner Mails out a Notice of Deficiency?
Tax Court

What Constitutes Sufficient Notification to a Taxpayer When the Commissioner Mails out a Notice of Deficiency?

Damian K. Gregory and Shayla A. Gregory, Petitioners v. Commissioner of Internal Revenue, Respondent 152 T.C. No. 7 | Filed March 13, 2019 Internal Revenue Code (IRC) §6212 authorizes the Commissioner to send out a notice of deficiency to a taxpayer by certified ... Steven R. Diamond, CPA, USTCP

Does IRS Refusal of a Taxpayer’s Proposed Offer for an Installment Agreement Constitute an Abuse of Discretion?
Tax Court

Does IRS Refusal of a Taxpayer’s Proposed Offer for an Installment Agreement Constitute an Abuse of Discretion?

James Loveland, Jr., and Tina C. Loveland, Petitioners v. Commissioner of Internal Revenue, Respondent 151 T.C. No. 7 | Filed September 25, 2018 The Tax Court abides by the “abuse of discretion standard”i when it reviews administrative determinations m... Steven R. Diamond, CPA, USTCP

Tax Court

Is a Postmark made by Stamps.com Evidence of a Timely Filed Petition with the U.S. Tax Court?

Robert H. Tilden, Petitioner v. Commissioner of Internal Revenue, Respondent T.C. Memo. 2015-188 The jurisdiction of the U.S. Tax Court to redetermine a deficiency in income tax depends upon the issuance of a valid notice of deficiency and a timely filed petition by the taxpayer. The taxpayer normally has 90 days (150 days if the notice is addressed to a person outside the United States) to... Steven R. Diamond, CPA