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A Primer on Material Participation Rules for Real Estate Businesses, Part 5: A Little Explored Rule that Could Make Losses from a Rental Activity Non-Passive by Lacey Strachan

A taxpayer’s trade or business undertakings can be combined to form an “activity” for purposes of the material participation rules if the undertakings “form an appropriate economic unit for measuring gain or loss under the passive activity rules,” considering all relevant facts and circumstances.  Taxpayers have the freedom to group their undertakings using any reasonable […] Read More…

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Marijuana Audit Challenge Includes Claimed Hidden Criminal Case by Nathan J. Richman

Tax Analysts, 2017 A Colorado marijuana business is alleging that an IRS’s civil tax audit is actually a ruse to gather information for a Justice Department criminal drug prosecution. The three petitioners in Rifle Remedies v. United States, No. 1:17-mc-00062-RM (D. Colo.), are seeking to quash a third-party summons issued in an IRS audit to […] Read More…

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IRS Expert Stays in Michael Jackson Case Despite ‘Lies’ by Bryan Koenig

Law360, Washington (October 20, 2017, 8:25 PM EDT) — Although an IRS expert lied on the stand about his work on cases like that of Michael Jackson’s estate, with hundreds of millions of dollars at stake, that isn’t enough to exclude his testimony outright and gut a crucial part of the agency’s case, a U.S. […] Read More…

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A Primer on Material Participation Rules for Real Estate Businesses. Part 4: Special Considerations for Real Estate Professionals with Rental Activities by Lacey Strachan

For taxpayers with rental properties, qualifying as a real estate professional under IRC Section 469(c)(7) is only the first obstacle in avoiding passive activity treatment for rental properties. Definition of Rental Activity. As a threshold matter, it is important to determine whether an activity is in fact a rental activity for purposes of Section 469.  […] Read More…

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[Dis]Honest Services Only a Crime If They Are Uniquely Governmental Services by Evan Davis

The dominoes continue to fall from last year’s Supreme Court reversal of former Virginia governor Bob McDonnell’s conviction for honest services fraud, for his having set up meetings in exchange for money. On July 12, 2017, the Second Circuit reversed a politician’s convictions for honest services fraud and money laundering because the jury instruction ran […] Read More…

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International Reporting Penalties – The Doctrine of Substantial Compliance by Steven Toscher

As part of the Internal Revenue Service’s (“IRS”) continuing international enforcement effort, it recently released training materials on what it means to be “substantially complete” for an international information return.  The training is significant because the failure to file a “substantially complete” foreign information return can subject the filer to substantial penalties and the failure […] Read More…

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Hochman Award in Tax Law Goes to Class of 2017 Justin Casey

In May 2017, UCLA Law awarded Justin Casey ’17 the Bruce I. Hochman Award for Excellence in the Study of Tax Law. The $15,000 award is presented annually by UCLA Law tax faculty to a graduating student who has demonstrated outstanding proficiency.  Casey graduated Order of the Coif, and earned a certificate in the Business […] Read More…

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Steven Toscher to Receive the 2017 Joanne M. Garvey Award on November 3, 2017

Steven Toscher will receive the Joanne M. Garvey Award to recognize lifetime achievement and outstanding contribution in the field of tax law, for 2017 Annual Meeting of the California Tax Bar and The California Tax Policy Conference, November 3, 2017, at the Park Hyatt Aviara Resort in Carlsbad, California Joanne M. Garvey Award – The […] Read More…

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For Whom the Collection Statute Tolls by Jonathan Kalinski

Every tax practitioner knows the general rule that the IRS has 10 years to collect a tax after the assessment. That isn’t blog material.  Less well known because it is infrequently litigated, is the flush language of IRC §6502(a), which states that the collection statute of limitations is tolled if a timely proceeding in court […] Read More…

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Criminal Tax Enforcement – It Happened Again and We Should Not Be Surprised by Steven Toscher

The Treasury Inspector General for Tax Administration (“TIGTA”) issued a report September 13, 2017, concluding that “declining resources have contributed to unfavorable trends in criminal investigation business results.” That’s Government speak that the IRS criminal tax enforcement program is falling behind. This is not a surprise for those of us in the trenches.  It reminds us of […] Read More…

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A Primer on Material Participation Rules for Real Estate Businesses, Part 2: Who is a Real Estate Professional? by Lacey Strachan

Taxpayers in Real Property Business. Although the general rule is that all rental activities are by definition passive, the Code has created an exception for certain professionals in the real estate business.  A real estate professional (as that term is defined under Section 469(c)(7), the section that sets forth the exception to the rule that all […] Read More…

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IRS Updates FBAR Reference Guide to Reflect Increased Inflation – Adjusted Non-Willful and Willful Penalty Amounts by Michel Stein

The IRS has updated its Reference Guide on Foreign Bank Account Reports (“Guide”) to help U.S. persons and tax professionals with FBAR filing obligations.   The Guide also supports IRS examiners in their efforts to administer the various IRS FBAR examination and penalty programs.   Most importantly, the Guide for the first time also reflects increased inflation-adjusted […] Read More…

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