Income Tax Issues
Income Tax Issues / Memorandum Opinions / Tax Opinions

Estate of Washington v. Commissioner
T.C. Memo. 2022-4

On February 2, 2022, the Tax Court issued a Memorandum Opinion in the case of Estate of Washington v. Commissioner (T.C. Memo. 2022-4). The primary issue presented in Estate of Washington was whether offers-in-compromise presented by the estate qualified for effective tax administration consideration. No George and Martha Mr. Washington (Tony) wed Mrs. Washington (Lenda) in 1981. They had one child. They divorced in 2006. Mr. Washington had unpaid income tax liabilities for 2008, 2009, 2010, 2014, and 2015. Mr. Washington died in November of 2015. Ironically, the Washingtons lived in Washington, D.C. Three provisions of the marital settlement agreement (“MSA”) are particularly relevant to this case. They relate to (i) Mr. and Ms. Washington's retirement plans, (ii) a life insurance policy provided to Mr. Washington through his employer, and (iii) Mr. and Ms. Washington's intentions concerning the interaction of the MSA and the Divorce Decree. Both parties waived any…

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May 9, 2022
Income Tax Issues
Income Tax Issues / Memorandum Opinions / Tax Opinions

Larson v. Commissioner
T.C. Memo. 2022-3

On February 2, 2022, the Tax Court issued a Memorandum Opinion in the case of Larson v. Commissioner (T.C. Memo. 2022-3). The primary issue presented in Larson was whether stock in an S corporation was subject to a substantial risk of forfeiture. Held: Nope. Background (and not a Particularly Flattering One for the petitioner) in Larson v. Commissioner Mr. Larson is a criminal. That’s not my opinion. That was the decision of the Southern District of New York in 2009, which sentenced him to 121 months in prison for tax evasion, three years of supervised release, and a fine. According to the Department of Justice, John Larson, a former senior manager at KPMG (Curly), and Robert Pfaff, a former partner at KPMG (Moe), were the founders and partners in an "investment advisor" firm for various tax shelter products. Along with R.J. Ruble, a partner at the law firm of Brown &…

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May 6, 2022
Penalties Under the Code
Memorandum Opinions / Penalties Under the Code / Tax Opinions

Long Branch Land LLC v. Commissioner
T.C. Memo. 2022-2

On January 13, 2022, the Tax Court issued a Memorandum Opinion in the case of Long Branch Land LLC v. Commissioner (T.C. Memo. 2022-2). The primary issues presented in Long Branch Land LLC v. Commissioner were whether the supervisory agent possessed the authority to supervise the examination of the taxpayer and to approve the penalties imposed by revenue agent, and whether the taxpayer failed to offer clear evidence to overcome presumption of regularity of actions of IRS officers. Background to Long Branch Land LLC This case involves a charitable contribution deduction claimed by the petitioner, Long Branch Land, LLC (Long Branch), for a conservation easement. The IRS disallowed the deduction and determined penalties. The IRS moved for partial summary judgment as to the question whether the IRS complied with the prior written supervisory approval requirements of IRC § 6751(b)(1) with respect to these penalties. The Prior Approval Requirement IRC §…

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May 5, 2022
Guest Article
All Articles / International Issues / Tax Articles

Guest Post: Make Your American Dream a Reality

Guest Writer:  Michael Longsdon of ElderFreedom.net* Immigrants moving to the United States often have their hands full with immigration paperwork, assimilation into their new communities, and even tax considerations. Despite these challenges, many come with a vision of the American dream. Use this guide to help you make your American Dream a reality! Down to Business Many new transplants are eager to find a way to support loved ones back in their home country. Sometimes, the answer is starting an American business. The business world is a great place to start your immigrant journey. One of the most important things to understand about doing business is the relevant tax structure, and a resource like Briefly Taxing is a great place to learn more. Getting Your Paperwork in Order There are a number of different ways people officially immigrate to the United States. If you have questions about the type of…

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May 4, 2022
Income Tax Issues
Income Tax Issues / Memorandum Opinions / Tax Opinions

Elbasha v. Commissioner
T.C. Memo. 2022-1

On January 12, 2022, the Tax Court issued a Memorandum Opinion in the case of Elbasha v. Commissioner (T.C. Memo. 2022-1). The primary issues presented in Elbasha were the petitioner’s filing status and whether and to what extent the petitioner can deduct Schedule C expenses. Background to Elbasha v. Commissioner The petitioner, an emergency room doctor, was born in Sudan, and he had family there during 2008 and 2009—the years at issue. The petitioner's Sudanese family included his wife, Suzan Ahmed, whom he married sometime during 2008 and remained married through the end of 2009. They had a daughter in 2009. The petitioner's wife did not move to the United States until 2010, but during the years at issue, he lived in a condominium in Georgia. The petitioner timely filed his 2008 Form 1040, on which he claimed single filing status. He timely filed his 2009 Form 1040 claiming head…

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May 4, 2022
Procedural Issues
Memorandum Opinions / Procedural Issues / Tax Opinions

Pfetzer v. Commissioner
T.C. Memo. 2021-145

On December 30, 2021, the Tax Court issued a Memorandum Opinion in the case of Pfetzer v. Commissioner (T.C. Memo. 2021-145). The primary issue presented in Pfetzer was whether the settlement officer failed to fulfill duty to verify that valid notices of deficiency were issued and mailed to taxpayer. Held: You betcha...but the IRS still managed to lose. Background to Pfetzer v. Commissioner The petitioner was not a model taxpayer. In point of fact, the petitioner failed to file Federal income tax returns for 2004 through 2012. The IRS prepared substitutes for return pursuant to IRC § 6020(b), and it assessed tax for all nine years. Unfortunately for the IRS, the record does not include any notices of deficiency for these years. Consequently, the petitioner did not petition the Tax Court to challenge notices of deficiency for any of these years…because...well...there weren’t any. In June 2016, after failing to pay…

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May 3, 2022
Procedural Issues
Memorandum Opinions / Procedural Issues / Tax Opinions

Starcher v. Commissioner
T.C. Memo. 2021-144

On December 30, 2021, the Tax Court issued a Memorandum Opinion in the case of Starcher v. Commissioner (T.C. Memo. 2021-144). The primary issue presented in Starcher was whether the IRS abused its discretion in upholding the filing of a notice of intent to levy. Held: Discretion sound—no abuse here. Background The petitioner did not file an income tax return for 2014, so the IRS prepared a substitute for return (SFR) for her pursuant to IRC § 6020(b). On the basis of the SFR, on April 22, 2019, the IRS sent petitioner a notice of deficiency. Petitioner did not petition this Court for redetermination within the prescribed time limit under IRC § 6213(a), and the IRS thereafter assessed these amounts. Soon thereafter, the IRS sent a Notice of Intent to Levy to the petitioner, who timely requested a CDP hearing indicating she could not pay the balance and that she…

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May 2, 2022