The IRS Office of Chief Counsel explained what the IRS can do when a return is filed by an identity thief in order to generate a fraudulent refund and the IRS has issued a statutory notice of deficiency based on that fraudulent return.
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IRS Practice & Procedure
IRS Announces the End of Tiered Issues
Effective Aug. 17, 2012, the IRS will no longer use the tiered management process to set examination priorities and address important issues in the Large Business & International division.
TIGTA: IRS Encourages Employees to Ignore ITIN Fraud
TIGTA confirmed allegations from IRS employees that their supervisors were urging them to ignore potential fraud in a program that reviews and verifies applications for ITINs.
Fraud Convicts Cannot Argue in Tax Court That Payments Did Not Result From Fraud
Taxpayers who were convicted of fraud are precluded from later arguing that payments they received were not the result of fraud, the Tax Court held in two related cases
TIGTA Recommends Steps for IRS to Reduce Fraudulent Refunds From Identity Theft
TIGTA reported that the IRS had missed 1.5 million tax returns with potentially identity-theft-related fraudulent tax refunds in excess of $5.2 billion for the 2011 filing season.
IRS Makes Offer-in-Compromise Rules More Flexible
The IRS announced that it is making the terms under which it will accept offers in compromise more flexible.
Circular 230, Section 10.21, and SSTS No. 6: Standards Relating to Taxpayer Errors and Omissions
Circular 230 SSTS No. 6 impose standards of conduct on CPAs who discover an error or omission in a prior-year tax return.
PTIN Fees Are Valid, Federal Court Holds
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
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
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.
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.
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.
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.
The IRS Collection Process: A Review of the Basics
Practitioners should know the procedures the IRS follows in its collections process.
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.
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.
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.
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.
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.
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.
INDIVIDUALS
Current Developments in Taxation of Individuals: Part 1
This update surveys recent federal tax developments involving individuals, including court cases, rulings, and guidance issued during the six months ending October 2025.
