Tax Blog/Blawg

As we enter the final stretch of 2020, certain windows of opportunity are closing for many clients to lawfully reduce their taxes or obtain cash refunds of taxes paid.  Here we focus on a big and soon-expiring opportunity for clients with heavily distressed assets or investments, and in net loss situations for 2020, which is all-too-common in the midst of Covid-19. 

The opportunity, which is unique to 2020 and thus requires immediate attention, involves triggering losses in a manner to achieve ordinary loss treatment.  Triggering losses at year-end is an annual ritual for many ...

As discussed in an earlier Chamberlain Tax Blawg, on August 28 Treasury issued Notice 2020-65 which defers the due date for withholding, deposit and payment of employee-side taxes imposed under Section 3101(a) (FICA) and corresponding taxes under Section 3201 (RRT).  Since the issuance of this Notice, there has been much commentary – in addition to consternation and hand-wringing on the part of clients – about a multitude of issues the Notice implicates. 

On September 8, the Texas Society of Certified Public Accountants added to this chorus with a comment letter to Treasury and ...

On Friday, in response to an August 8, 2020 Presidential Memorandum, Treasury issued Notice 2020-65 which defers the due date for withholding, deposit and payment of employee-side taxes imposed under Section 3101(a) (FICA) and corresponding taxes under Section 3201 (RRT). This deferral is effective September 1!

No doubt this Notice will be the subject of fierce political debate. The day of the Notice’s release, Congressman Don Beyer of Virginia fired a first shot across the bow. In a press release, the Congressman accused the deferral of being a “gimmick” that “could hit ...

Last week, the Fifth Circuit in Matter of Diaz invalided a bankruptcy court rule that would have required that taxpayers make available to creditors any current or projected tax refund in excess of $2,000.  Docket No. 19-50982 (5^th Cir., Aug. 26, 2020).

The perfect storm is developing for this issue to affect a growing number of taxpayers.  Due to the economic downturn during the Coronavirus pandemic, a record number of bankruptcies is anticipated.  Also expected is a potentially unprecedented number of tax refunds as a result of the Coronavirus Aid, Relief, and Economic Security ...

On August 24, the IRS issued an internal memorandum that impacts when taxpayers may obtain IRS Appeals Conferences if their issues are designated for litigation.  As background, the IRS has a long-standing policy of permitting taxpayers an administrative-level review of audit adjustments by referring matters to its Office of Appeals.  For decades, this review process was discretionary for the IRS to offer.  It was a matter of administrative grace.  No longer.

Enter The Taxpayer First Act

In July 2019, Congress enacted The Taxpayer First Act which codified the Appeals Office (with a new ...

Have you ever played darts?  Where the dart hits the board is very important to your score, but some rookies are happy if their dart hits the board at all.  That would be a fair characterization of The Inspector General for Tax Administration’s (“TIGTA”) January 21, 2020 report entitled “IRS Should Better Identify Noncompliant Exempt Orgs.”

In this report, TIGTA is very much like a rookie darts player, who declares himself a winner because his first dart hit the board.  In this regard, the Report is accurate about one thing:  the IRS does have problems identifying non-compliant ...

COVID-19 is a public health crisis that has already had a profound impact on the U.S. economy. Businesses and individuals are struggling to adapt to restrictions imposed by federal, state and local governments in an attempt to "flatten the curve" and limit the consequences on public health. Several major laws were recently enacted to help partially offset the economic effects of this crisis and hopefully put businesses and the economy in a position to hit-the-ground running once this time has passed.

The Chamberlain Tax Planning & Business Transactions Team has prepared this ...

The Inspector General for Tax Administration, TIGTA, is in the news regularly.  In addition to tracking down misbehaving IRS employees and misbehaving representatives, an important role of this organization seems to be examining every aspect of the operation of the Internal Revenue Service about which it can publish a critical report.  Lately, it seems that TIGTA has been publishing an average of one a week, virtually all of which have been critical of the performance of the Internal Revenue Service.  Two of my favorites, however, deserve some close examination and cause this writer to ...

Choice of entity is one of the first and most important tax-planning decisions that any entrepreneur must make. Conventional wisdom holds that most entrepreneurs should organize their businesses as “pass-through” entities – primarily limited liability companies, partnerships, subchapter S corporations, or sole proprietorships. Pass-through entities are not themselves taxable. Rather, all of their income is “passed through” and taxable to their owners. By contrast, operating a business in the other main form – a corporation – subjects the business’s ...

As one of many U.S. multinationals that reportedly implemented the Double Irish international tax structure, Starbucks has reportedly paid a U.K. tax rate of 2.8 percent over the last decade.  Not satisfied with this levy, last month the British Parliament called Starbucks and other U.S. multinationals before the body to discuss the structure.  Last week, in response to Parliament’s pressure, Starbucks announced that it would voluntarily forgo U.K. deductions to ensure it pays £10 million ($16 million) in tax during 2013 and 2014.  It remains to be seen whether Starbucks’ ...