Federal
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August 07, 2024
Tax Court's Economic Substance Foray May Clarify Limits
A U.S. Tax Court judge plans to address an ill-defined provision governing the relevance of the economic substance doctrine in a microcaptive insurance case, offering the courts another chance to clarify an anti-abuse tool the IRS has been deploying more often.
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August 07, 2024
US Taxpayers Claimed $8.4B In Energy Credits In 2023
Taxpayers claimed $6.3 billion is residential clean energy credits and $2.1 billion in energy-efficient home improvement credits in 2023, the U.S. Treasury Department and Internal Revenue Service said Wednesday.
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August 06, 2024
US Wants Israeli Businessman Sanctioned In $3.6M FBAR Suit
An Israeli businessman should be sanctioned for defying a Washington federal court's discovery orders by a default judgment in the U.S. government's $3.6 million case over his unreported foreign bank accounts and by another order to comply, the government said Tuesday.
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August 06, 2024
Wind Tower Co. Asks Full Fed. Circ. To Revisit Subsidy Duties
A Federal Circuit panel wrongly concluded that a 10% depreciation rate for deducting costs related to manufacturing facilities set by Canadian law was an unfair trade subsidy that justified countervailing trade duties, a wind tower manufacturer told the court in seeking a rehearing.
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August 06, 2024
Businessman Found To Owe Over $2.9M In FBAR Fines
A U.S. inventor and businessman who had been based in Hong Kong and started a company there must pay over $2.9 million in penalties for failing to report his overseas bank accounts for eight years, a Virginia federal judge ruled Tuesday.
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August 06, 2024
Tax Compliance Costs US Economy $546B, Report Says
The billions of hours spent completing Internal Revenue Service forms and tax returns, along with out-of-pocket compliance costs, ultimately costs the U.S. economy over $546 billion, the Tax Foundation reported Tuesday.
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August 06, 2024
IRS Error Doesn't Enable Kyocera's $7M Refund Suit, US Says
Electronics maker Kyocera can't seek a $7 million tax refund in federal district court because it owed taxes when it filed its original complaint, a fact that isn't changed by IRS' improper abatement of the company's liabilities before it filed an amended complaint, the government argued.
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August 06, 2024
Ayahuasca Church Asks DC Circ. To Rethink Tax Status
An Iowa church that used a psychedelic drug in its rites asked the D.C. Circuit for an en banc rehearing after a panel determined the church was correctly denied tax-exempt status since its main purpose was using a federally illegal drug.
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August 06, 2024
Bressler Grows In NJ With New Litigation, Tax Experts
Bressler Amery & Ross PC added longtime experts in tax law, trusts and estates, and commercial litigation in a recent round of expansion in New Jersey announced this week.
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August 06, 2024
Treasury Floats Rules To Address Losses Under Pillar 2
The U.S. Treasury Department proposed regulations Tuesday that outline when foreign taxes under the Pillar Two international minimum tax agreement could trigger long-standing U.S. rules that aim to prevent companies from what is known as double-dipping the same economic loss.
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August 06, 2024
NC Software Execs Can't Unravel Payroll Tax Fraud Conviction
Two former software executives found guilty of failing to pay over $600,000 in employment taxes failed to clear a steep hurdle in trying to reverse their convictions, a North Carolina federal judge said in rejecting their bid for acquittal or a new trial.
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August 06, 2024
Ex-UBS Exec Calls $4.7M In FBAR Penalties Unconstitutional
A former executive for Swiss bank UBS' North American group told a Connecticut federal court the $4.7 million in penalties he faces for willful failure to report his foreign bank accounts are unconstitutionally excessive.
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August 06, 2024
Partnership Asks Tax Court To Toss $13M Credit Reduction
An Idaho partnership asked the U.S. Tax Court to throw out an Internal Revenue Service adjustment that reduced the value of an energy investment tax credit by $13 million, saying it never claimed the credit in the first place.
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August 06, 2024
Arnold & Porter Adds Abramson Cancer Center Chief Counsel
Throughout her career and while working in progressive leadership roles for the Abramson Cancer Center at the University of Pennsylvania, Mir Masud-Elias, Arnold & Porter Kaye Scholer LLP's newest counsel, has asked herself the same question: Is this role the best use of her time on Earth?
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August 06, 2024
Paul Hastings Gains Tax Pro In Dallas From McDermott
Paul Hastings announced Tuesday that its meteoric growth in Texas is continuing with the addition of a partner in Dallas who strengthens its global tax practice and came aboard from McDermott Will & Emery LLP.
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August 05, 2024
9th Circ. Rejects Calif. Couple's Informal Tax Refund Bid
A California couple who for years had a practice of overpaying their federal taxes missed a critical deadline to informally claim a nearly $700,000 tax overpayment, a Ninth Circuit panel ruled Monday, rejecting their request for a refund.
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August 05, 2024
FedEx Asserts Chevron Ruling Supports $84.6M Refund
The U.S. Supreme Court's recent rejection of the Chevron doctrine entitles FedEx to an $84.6 million tax refund by taking credits for foreign taxes it paid on offset earnings when repatriating overseas income, the package delivery giant told a Tennessee federal court.
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August 05, 2024
Truck Co. Can't Skirt $500M Excise Tax Bill, US Tells 6th Circ.
A Tennessee truck company failed to demonstrate its eligibility for a safe harbor that allowed it to escape from over $500 million in excise taxes and penalties over refurbished trucks it sold, the U.S. government told the Sixth Circuit, asking it to reverse a lower-court decision.
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August 05, 2024
Pension Plan Testimony Barred In $2B Danish Tax Fraud Case
U.S. pension plans have proposed irrelevant expert testimony in response to allegations of their participation in a $2.1 billion Danish tax fraud scheme, a New York federal judge ruled in excluding the testimony but leaving room to try again.
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August 05, 2024
Dems Unearth Another Thomas Trip Paid For By Harlan Crow
U.S. Supreme Court Justice Clarence Thomas took a previously undisclosed trip between Hawaii and New Zealand on a billionaire Republican donor's private jet in 2010, lawmakers revealed in a letter Monday that offered the donor a "final opportunity" to explain how that trip and others don't constitute a tax fraud scheme.
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August 05, 2024
Chamber Asking 4th Circ. To Revive Md. Digital Ad Tax Fight
The U.S. Chamber of Commerce and other groups are seeking Fourth Circuit review of a federal district court decision throwing out their First Amendment complaint against Maryland's digital advertising tax, the groups told the lower court.
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August 05, 2024
3 Changes To IRS Direct File On Stakeholders' Wish Lists
Organizations that partnered with the IRS or states on the free online tax filing system known as Direct File are seeking improvements in the program's second year, including allowing taxpayers to transfer more data from federal returns to state returns and enhancements for Spanish speakers. Here, Law360 looks at three changes sought by stakeholders.
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August 05, 2024
IRS Announces 2024 Senior Executive Review Board Members
The Internal Revenue Service on Monday named the 99 employees who will make up the standing roster of its fiscal year 2024 Senior Executive Service Performance Review Boards.
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August 02, 2024
IRS Wrongly Attacking Installment Method Deals, Court Told
The Internal Revenue Service mischaracterized installment sales as potentially abusive tax shelters in last year's rule proposing additional reporting requirements for such deals, an Idaho capital assets dealer told a federal district court.
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August 02, 2024
St. Louis Attys Can't Get Acquittal In $4M Tax Avoidance Case
Two Missouri-based attorneys, a father and daughter duo found guilty of participating in a $4 million tax avoidance scheme, will not be granted a new trial or an acquittal, despite their assertions that a number of errors tainted their trial, a North Carolina federal judge ruled Friday.
Expert Analysis
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Compliance Obligations Still Murky For Superfund Excise Tax
Comments on the IRS' reinstatement of the Superfund chemicals excise tax show that, given taxpayers' lack of institutional knowledge and the government's previous failure to finalize clarifying guidance, further regulatory action is needed to help taxpayers understand their obligations, say Nicole Elliott and Mary Kate Nicholson at Holland & Knight.
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The Reciprocal Tax Bill Is A Warning Shot At Pillar 2
A bill recently introduced in the House of Representatives to reciprocally tax countries deemed to have imposed discriminatory taxes on U.S. citizens and businesses takes aim at countries implementing the global minimum tax treaty known as Pillar Two, with which the U.S. has not complied, says Alan Cole at the Tax Foundation.
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3 Developments That May Usher In A Nuclear Energy Revival
A recent advancement in nuclear energy technology, targeted provisions in the Inflation Reduction Act and a new G7 agreement on nuclear fuel supply chains may give nuclear power a seat at the table as a viable, zero-carbon energy source, say attorneys at Vinson & Elkins.
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What Tax-Exempt Orgs. Need From Energy Credit Guidance
Guidance clarifying the Inflation Reduction Act’s credit regime, expected from the U.S. Department of the Treasury this summer, should help tax-exempt organizations determine the benefits of clean energy projects and integrate alternative energy investments into their activities, say attorneys at Morgan Lewis.
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Unconventional Profits Interest Structures Find New Support
A recent U.S. Tax Court ruling should provide comfort that less-than-plain-vanilla profits interest structures, created to achieve complicated economic arrangements, can succeed in generating more optimal tax outcomes, provided the terms are properly drafted, says Daren Shaver at Hanson Bridgett.
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Roadblocks For Cannabis Employers Setting Up 401(k) Plans
Though the Internal Revenue Code and the Employee Retirement Income Security Act generally allow cannabis businesses to establish 401(k) plans for their employees, companies must still pick their way through uncertainties around tax deductions and recruiting reliable vendors, say attorneys at Shipman & Goodwin.
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How Foreign Info Return Penalty Case May Benefit Taxpayers
The U.S. Tax Court's recent decision that the Internal Revenue Service cannot penalize taxpayers for failing to file foreign corporation information returns may give similarly situated taxpayers an opportunity to also avoid penalties, provided they protect their rights before the decision is overturned or mooted by legislation, say attorneys at Arnold & Porter.
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What's Unique — And What's Not — In Trump Protective Order
A Manhattan judge's recent protective order limiting former President Donald Trump's access to evidence included restrictions uniquely tailored to the defendant, which should remind defense attorneys that it's always a good idea to fight these seemingly standard orders, says Julia Jayne at Jayne Law.
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The Nuts And Bolts Of IRS Domestic Content Tax Credit
Recent IRS guidance provides specifics on how renewable energy projects can qualify for bonus tax credits by meeting U.S. domestic content rules, but also creates a qualification framework that will be complicated for project developers to navigate, say Scott Cockerham and Wolfram Pohl at Orrick.
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How Cities Can Tackle Post-Pandemic Budgeting Dilemmas
Due to increasing office vacancies around the country, cities may consider politically unpopular actions to avoid bankruptcy, but they could also look to the capital markets to ride out the current real estate crisis and achieve debt service savings to help balance their budgets, say attorneys at Cadwalader.
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Guidance Adds Clarity To Energy Communities Bonus Credits
Recent IRS guidance on the Inflation Reduction Act's changes to tax credits for renewable energy projects offers much-needed pointers for developers and financing parties, and should allow them to more comfortably incorporate special bonus credits for projects in energy communities into their transactions, say Jorge Medina and Ira Aghai at Shearman.
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Taxing The Digital Economy: The Good, The Bad And The Ugly
U.S. tech companies should watch for important developments in international taxation, including the resolution of Apple's decade-old state aid case, growing frustration with the Organization for Economic Cooperation and Development's global tax plan and adoption of the digital services tax instead, says Joyce Beebe at Rice University's Baker Institute for Public Policy.
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Big Tax Changes For Multinational Cos. In Budget Proposal
The Biden administration’s fiscal year 2024 budget proposes changes that would materially alter decades-old Internal Revenue Code provisions, requiring a shift in multinational corporations' tax planning strategies comparable to that required after enactment of the Tax Cuts and Jobs Act, say Xenia Garofalo and Kyle Colonna at Eversheds Sutherland.