IRS Practice & Procedure

TOPICS

July 12, 2012

Tax Court Petition Challenging a Notice of Deficiency Suspends Statute of Limitation

The Eleventh Circuit held that a petition filed by taxpayers who had transferee liability for their corporation’s tax liability was a “proceeding in respect of the deficiency” that suspended the limitation period for assessment

July 6, 2012

Debtors’ Taxes Are Not Discharged in Bankruptcy Where Tax Return Was Filed Late

A federal appeals court held that bankrupt debtors who filed their income tax return 17 months after their income taxes were assessed were not entitled to have those taxes discharged in the bankruptcy proceeding.

July 1, 2012

Should Collection Due Process Hearings Be Recorded?

Collection due process (CDP) hearings, unlike many other administrative hearings, are not required to be, and often are not, recorded.

July 1, 2012

Global High-Wealth Audit Update

While the IRS audit rate for individual returns of persons earning less than $200,000 has hovered at about 1% over the past several years, 12% of individual taxpayers with incomes of $1 million or more were audited in fiscal year 2011.

July 1, 2012

Get the Most Out of Overpayments Applied to the Following Year’s Return

A taxpayer can elect to have an overpayment refunded or applied to the subsequent year’s estimated tax payment. This election, once made, is generally irrevocable.

July 1, 2012

The IRS Collection Process: A Review of the Basics

Practitioners should know the procedures the IRS follows in its collections process.

July 1, 2012

Releasing a Wrongful Levy

While it is important to understand the lien process and protections available to taxpayers, another issue comes into play when the IRS levies on assets that may belong to a third party.

July 1, 2012

Where’s My Canceled Check?: A Review of the Basics

Most people now receive only scanned images of their canceled checks; however, during an audit, some IRS requests for information insist on substantiating expenditures with front-and-back copies of canceled checks.

July 1, 2012

Homeland Security May Contact U.S. Persons Living Abroad Who Owe Back Taxes

The IRS has established procedures to facilitate tax collection from taxpayers who live outside the United States, including submitting identifying taxpayer information to a database maintained by the Department of Homeland Security.

July 1, 2012

IRS Postpones Basis Reporting Rules for Debt Instruments and Options

The IRS postponed for one year the basis and gain reporting rules under Secs. 6045(g), 6045(h), 6045A, and 6045B for debt instruments and options.

July 1, 2012

Overstatement of Basis Does Not Extend Assessment Statute of Limitation

The Supreme Court held that extended six-year statute of limitation for assessing a deficiency against a taxpayer where the taxpayer omits an amount in excess of 25% of gross income does not apply to a taxpayer’s overstatement of basis on a return.

July 1, 2012

IRS Can Summons “Non-Content” Information From Emails

Chief counsel advice issued last year placed restrictions on the ability of a revenue officer to issue an administrative summons to an ISP for the content of a business taxpayer’s “alter ego’s” emails involving a period of more than two years.

July 1, 2012

Taxes From Postpetition Farm Sale Are Not Dischargeable

The Supreme Court ruled that taxes on gain from the sale of a farm after its owner had filed a Chapter 12 bankruptcy petition were not taxes incurred by the bankruptcy estate.

June 27, 2012

IRS Releases New FAQs for Offshore Voluntary Disclosure Program, Announces Other Rules

The IRS released 55 questions and answers regarding its offshore voluntary disclosure program.

June 22, 2012

IRS Suspends Issuing ITINs Without Original Documentation

The IRS will no longer issue individual taxpayer identification numbers unless the applicants provide original documents, such as passports or birth certificates, or certified copies of those documents from the issuing agencies.

June 21, 2012

Tips and Service Charges Distinguished in Guidance

The IRS issued question-and-answer guidance for distinguishing between tips and service charges for FICA tax and other purposes.

June 11, 2012

Eleventh Circuit Says PTIN User Fees Are Valid

The Eleventh Circuit held that the fee the IRS charges to issue PTINs to tax return preparers, who are required to use the PTINs on returns they prepare, is valid

June 1, 2012

IRS Withholding Tax Enforcement: Dropping the Other Shoe?

Despite a hefty price for noncompliance—including secondary liability for the withholding tax, interest, and various penalties—U.S. companies have yet to master the science of cross-border withholding.

June 1, 2012

Priority Phone Service Created for Correspondence Audits

The IRS has launched a new toll-free phone service for tax professionals to use when responding to correspondence examination telephone calls or letters.

June 1, 2012