Accuracy Related Penalty

Plentywood Drug Inc. v. Commissioner (T.C. Memo. 2021-45)

On April 26, 2021, the Tax Court issued a Memorandum Opinion in the case of Plentywood Drug, Inc. v. Commissioner (T.C. Memo. 2021-45). The primary issues presented in Plentywood Drug, Inc. were whether the petitioner’s owners received “fair rent” or constructive dividends for the rental of the petitioner’s drug store, and whether the petitioner (a corporation) satisfied its burden to show that the IRS failed to receive prior supervisory approval for the accuracy-related penalties at

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Income Tax Issues
Bank Deposits Analysis

Martin v. Commissioner (T.C. Memo. 2021-35)

On March 24, 2021, the Tax Court issued a Memorandum Opinion in the case of Martin v. Commissioner (T.C. Memo. 2021-35). The primary issues presented in Martin were whether the IRS abused its discretion in disallowing substantial (old and large) deductions and whether the petitioners were liable for penalties for filing (very) late and for being (very) negligent and for (very) substantially understating their liabilities. Background to NOLs The petitioner-husband was a racecar driver and

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Economic Substance Doctrine

Daichman v. Commissioner (T.C. Memo. 2020-126)

On August 31, 2020, the Tax Court issued a Memorandum Opinion in the case of Daichman v. Commissioner (T.C. Memo. 2020-126). The primary issue before the court in Daichman was whether the petitioners are entitled to a short-term capital loss deduction of $2.1 million in connection with the dissolution of their S corporation or whether their tax transactions lacked economic substance.

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Plentywood Drug Inc. v. Commissioner (T.C. Memo. 2021-45)

On April 26, 2021, the Tax Court issued a Memorandum Opinion in the case of Plentywood Drug, Inc. v. Commissioner (T.C. Memo. 2021-45). The primary issues presented in Plentywood Drug, Inc. were whether the petitioner’s owners received “fair rent” or constructive dividends for the rental of the petitioner’s drug store,

Read More »

Martin v. Commissioner (T.C. Memo. 2021-35)

On March 24, 2021, the Tax Court issued a Memorandum Opinion in the case of Martin v. Commissioner (T.C. Memo. 2021-35). The primary issues presented in Martin were whether the IRS abused its discretion in disallowing substantial (old and large) deductions and whether the petitioners were liable for penalties for

Read More »

Daichman v. Commissioner (T.C. Memo. 2020-126)

On August 31, 2020, the Tax Court issued a Memorandum Opinion in the case of Daichman v. Commissioner (T.C. Memo. 2020-126). The primary issue before the court in Daichman was whether the petitioners are entitled to a short-term capital loss deduction of $2.1 million in connection with the dissolution of

Read More »