We have covered timing and delivery issues in several articles, such as the recent Demuth and Hoensheid cases.[1] Similarly, the recent Tax Court case of Gage v. Comm’r dealt with the taxpayers that believed they paid a $875,000 settlement to the Department of Housing and Urban Development (“HUD”) in December of 2012.[2] Unfortunately for the…
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In May of this year the U.S. Tax Court issued a memorandum of opinion on the value of several assets included in the Estate of Michael Jackson (“Estate”) for federal estate tax purposes.[1] This opinion comes more than a decade after Jackson’s death in June of 2009 and provides some resolution (albeit subject to appeal)…
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So, we did not write on the first District Court case which was a loss for CIC Services, LLC (“CIC”) and Ryan, LLC(“Ryan”), the Plaintiffs. But, a Supreme Court decision gave the Plaintiffs another bite at the apple. This case involves Notice 2016-66 (“Notice”), the older-sibling notice to Notice 2017-10, in which micro-captive insurance transactions…
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In January of 2002 the Internal Revenue Service (“IRS”) issued a press release highlighting a dozen different tax scams and encouraged taxpayers to “maintain national vigilance.”[1] This list was dubbed the “Dirty Dozen,” and the IRS has continued to issue similar press releases containing updated lists of purported tax scams for taxpayers to be on…
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Last week, Charles Allen wrote about Blossom Day Care Centers, Inc. (“Blossom”) and its owners regarding their employment tax case.[1] Frequently, we write articles intending to remind readers of the importance of substantiation, especially in the income tax world. In reviewing Charles Allen’s article, I kept finding myself wondering about the income tax implications of…
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In a recent Tax Court case, the Court determined that corporate officers were indeed employees of the corporation entitled to reasonable compensation, and as such, the corporation is liable for employment taxes on reasonable compensation imputed to the corporate officers.[1] Mr. and Mrs. Hacker, who owned 51% and 49% of Blossom Day Care Centers (“Blossom”)…
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In a recent opinion out of the United States Court of Appeals for the Tenth Circuit, the Court affirmed the Tax Court’s decision denying taxpayers loss on the sale of a residential property as well as depreciation deductions on property that was purportedly used in taxpayer’s business.[1] Additionally, the Court upheld the imposition of the…
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