Document Summaries for the week of Feb. 7, 2022

Tax document summaries for the week of Feb. 7–Feb. 11, 2022, covering corporations, individuals, and IRS procedure.


Tax Court issues corrected Timberland decision

The Tax Court released a corrected opinion of a decision originally issued on Jan. 31, 2022. The court ordered the new opinion to reflect a corrected reference to a Treasury regulation. TBL Licensing LLC, 158 T.C. No. 1 (2/8/22) (corrected).



Court upholds deficiency assessment; rejects taxpayer's 'frivolous and groundless arguments'

The Tax Court upheld an IRS notice of deficiency assessing additional income taxes of almost $50,000 after disallowing certain deductions a taxpayer claimed in connection with his business. The court also upheld an assessment of more than $20,000 in penalties after noting that, rather than attempt to demonstrate that the IRS erred in its determination, the taxpayer challenged the determination with "frivolous and groundless arguments." Williams, T.C. Memo. 2022-7 (2/7/22).

Court agrees that transferees are liable for $24.7 million

On remand from the Ninth Circuit, which had reversed the Tax Court's holding that a group of taxpayers were not tranferees under the Arizona Uniform Fraudulent Transfer Act (Arizona UFTA) and Sec. 6901, the court agreed with the IRS's computations of the transferees' tax liability and rejected their computations. Thus, the Tax Court concluded that the transferees owe a tax deficiency of $13,494,884, an accuracy-related penalty of $2,698,997, and interest of $8,559,729, for a total of $24,753,610. Slone, T.C. Memo. 2022-6 (2/7/22).



IRS to no longer require facial recognition for account access

The IRS announced that it will transition away from using a third-party service for facial recognition to help authenticate people creating new online accounts. IR-2022-27 (2/7/22) (see related news story).

IRS issues nonacquiescence in backup withholding case

The IRS announced that it would not acquiesce in the decision in Quezada, 982 F.3d 931 (5th Cir. 2020). Specifically, it said it would not acquiesce to the holding that the statute of limitation on assessing backup withholding liability begins when the taxpayer files a Form 1040 and Forms 1099-MISC that omit payee taxpayer identification numbers. AOD 2022-1 (2/4/22).

IRS identifies paused notices and letters

The IRS identified the letters and notices it will not send taxpayers as it works through its backlog of unprocessed prior-year returns. IR-2022-31 (2/9/22) (see related news story).

Tax Insider Articles


Business meal deductions after the TCJA

This article discusses the history of the deduction of business meal expenses and the new rules under the TCJA and the regulations and provides a framework for documenting and substantiating the deduction.


Quirks spurred by COVID-19 tax relief

This article discusses some procedural and administrative quirks that have emerged with the new tax legislative, regulatory, and procedural guidance related to COVID-19.