In a recent taxpayer-favorable case, the Tax Court upheld a loss deduction for a worthless investment under Code Section 165. At issue was an interest held by a partnership in a related family-owned real estate development business. The taxpayer, MCM Investment Management LLC (“MCM”) alleged its interest in McMillin Companies, LLC (“InvestCo”), a real estate…
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In a November 25, 2019 memorandum opinion by the Tax Court, a pro se taxpayer in the business of horse breeding for competitions and scaling down his business, was determined to be engaged in activities for profit within the meaning of Section 183 and thus allowed to deduct his expenses under Section 162. Petitioner, Lowell…
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In a recent release, the IRS announced the release of final regulations under IRC § 2010. The new final regulations largely adopt the previous proposed regulations published last November. The final regulations were released in Treasury Decision 9884 on November 22, 2019 and effective on and after November 26, 2019. I previously wrote about the…
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On October 28, 2019, the Tax Court released its opinion in Coal Property Holdings, LLC v. Comm’r, 153 T.C. No. 7 (2019). This case comes at a sensitive time of year where deadlines are looming in order to file conservation deeds to qualify for the deduction under Section 170(h), relating to qualified conservation contributions, for…
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On October 9, 2019, the Internal Revenue Service (“IRS”) released its latest buzzkill, Rev. Rul. 2019-24, answering questions involving hard forks of cryptocurrency, which, as explained more below, is where a new type of cryptocurrency is created and there is a permanent diversion from legacy currency or existing distributed ledger. In conjunction with the release…
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On September 16, 2019, the Internal Revenue Service (“IRS“) announced that it would be mailing settlement offers for certain taxpayers under audit who participated in “abusive” micro-captive insurance transactions. The micro-captive transactions were listed as a transaction of interest by the IRS back in 2016. Section 2 of Notice 2016-66 described the transaction itself as…
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One of the more common engagements for our firm is to assist with business sales and acquisitions. This article is the third in a series of articles which will walk through and generally discuss the steps typically associated with the sale of a business. In Part 1, we discussed the breakdown of the business, the…
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It is helpful to remind taxpayers now and then that there do exist plenty of bad-apple advisors out there. Quite often, we at ESA find ourselves helping our clients wind-down, mitigate, and stop erroneous positions and planning put into by place by such bad-apple advisors. Our firm has even assisted in defending audits and tax…
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For a few months, the short and mid-term applicable federal rates have been on the heels of one another. These rates ride with treasury rates and the economy in general. For some reason, here lately the mid-term rates have been lower on occasion than the short-term rates. I even caught myself thinking, is this a…
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Timely mailing is timely filing. Seriously, it is. In the case of Curtiss T. Williams, we are reminded of how important it is to ensure compliance and maintain proof of compliance with the mailbox rule of the Internal Revenue Code. While really just a mundane case of a taxpayer getting his petition dismissed due to late filing,…
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