In Izen v. Comm’r, the Fifth Circuit Court of Appeals recently affirmed a Tax Court decision to deny a taxpayer’s charitable contribution deduction where the taxpayer failed to meet the statutory documentation requirements for the charitable contribution.[1] The key documentation that the taxpayer lacked was a contemporaneous written acknowledgement that included his taxpayer identification number.…
Read More
In a recent case out of the United States District Court for the Middle District of Tennessee, the Court held that attorney fees awarded plaintiff’s counsel who was handling the case pro bono, that is, free of charge, were not income to the plaintiff who was represented by the attorneys receiving the fees.[1] In the…
Read More
Generally speaking, tax follows the facts. One can of course change those facts, but when done so merely superficially, intended results may not follow. Some may be more familiar with the phrase “putting lipstick on a pig.” Well, that seems to be more or less the case in the recent opinion released in the Eighth…
Read More
In a recent Tax Court case[1], the Court held that husband and wife taxpayers failed to meet the so-called real estate professional exception to the passive activity rules resulting in the Court denying their excess deductions from rental real estate. The passive activity rules related to rental real estate activities are a little more complex…
Read More
In the recent Tax Court Opinion of Sherwin Community Painters, Inc. v. Comm’r, a corporation was denied a Section 162 business deduction for amounts paid for the boyfriend of the sole shareholder’s daughter to take a course in coding.[1] Gray Edmondson discussed the importance of being in a trade or business years ago, one of…
Read More
On February 2, 2022, the Tax Court issued a memorandum opinion in the case of John M. Larson (“Larson”).[1] This case involves a dispute going back more than 20 years. Mr. Larson was an attorney and CPA. He and two other men, Robert A. Plaff and David Amir Makov, promoted a fraudulent tax shelter transaction…
Read More
In another recent case involving a multi-entity tax savings strategy, pitched as the “integrated tax plan,” particularly leveraging “management fees,” we see again the Tax Court scrutinizing the legitimacy of the structure, incorporating a C corporation and a partnership, and in turn allowing the IRS to whipsaw the taxpayers.[1] Facts Around late 2009 through early…
Read More
In the Heiting v. United States[1] decision issued on October 18, 2021, the United States Court of Appeals for the Seventh Circuit affirmed a district court decision[2] to dismiss a couple’s claim for a refund of taxes, rejecting the taxpayers’ argument that the repurchase of restricted stock previously sold by their trustee was effectively a…
Read More
In a recent case out of the United States District Court for the District of Connecticut, the Court denied the IRS’ motion for summary judgment and refused to aggregate the gift of partial interests in real estate together for purposes of valuing the gifts and thus determining appropriate discounts.[1] The IRS alleged that no discount…
Read More
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)…
Read More