Robin Weingast - 419 IRS lawsuits IRS audits , 419 Welfare Plan @ Pissed Consumer
Small businesses facing audits and potentially huge tax penalties over certain types of retirement plans are filing lawsuits against those who marketed, designed and sold the plans. The 412(i) and 419(e) plans were marketed in the past several years as a way for small business owners to set up retirement or welfare benefits plans while leveraging huge tax savings, but the IRS put them on a list of abusive tax shelters and has more recently focused audits on them.
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INCOME TAX
ReplyDeleteNotice 2016–66 Notice 2016–66
This notice identifies certain “micro-captive transactions” and substantially similar transactions as transactions of interest for purposes of § 1.6011–4(b)(6) of the Income Tax Regulations and §§ 6111 and 6112 of the Internal Revenue Code. This notice also alerts persons involved in such transactions to certain responsibilities and penalties that may arise from their involvement with these transactions.
Today the IRS issued a press release announcing that it is significantly increasing enforcement actions for syndicated conservation easement donations and that these transactions are a priority compliance area for the agency. In the press release, the IRS stated that examinations of conservation easement donations are being coordinated across the agency. The IRS also announced that investigations relating to conservation easement deductions had been initiated by the IRS Criminal Investigation Division. Currently, there are more than 80 conservation easement cases pending in Tax Court, and the IRS outlined its commitment to bringing more cases to Tax Court where it believes the deduction should be disallowed.
Delete419 IRS lawsuits IRS audits | Robin Weingast review from New York, New York
DeleteGoogle lance wallach for help, as an expert witness his side has never lost a case, get all your money back Media Newswires 01/22/2010 Small Business Retirement Plans Fuel Litigation Small businesses facing audits and potentially huge tax penalties over certain types of retirement plans are filing lawsuits against those who marketed, designed and sold the plans. The 412(i) and 419(e) plans were marketed in the past several years as a way for small business owners to set up retirement or welfare benefits plans while leveraging huge tax savings, but the IRS put them on a list of abusive tax shelters and has more recently focused audits on them. The penalties for such transactions are extremely high and can pile up quickly - $100,000 per individual and $200,000 per entity per tax year for each failure to disclose the transaction - often exceeding the disallowed taxes. There are business owners who owe $6,000 in taxes but have been assessed $1.2 million in penalties. The existing cases involve many types of businesses, including doctors' offices, dental practices, grocery store owners, mortgage companies and restaurant owners. Some are trying to negotiate with the IRS. Others are not waiting. A class action has been filed and cases in several states are ongoing. The business owners claim that they were targeted by insurance companies; and their agents to purchase the plans without any disclosure that the IRS viewed the plans as abusive tax shelters. Other defendants include financial advisors who recommended the plans, accountants who failed to fill out required tax forms and law firms that drafted opinion letters legitimizing the plans, which were used as marketing tools.
(a) General rule. Under § 1.6011–4(d) and the Instructions to Form 8886, Reportable Transaction Disclosure Statement, the required disclosure must identify and describe the transaction in sufficient detail for the IRS to be able to understand the tax structure of the reportable transaction and the identity of all parties involved in the transaction.
ReplyDelete(b) Information required of all participants. For all participants, describing the transaction in sufficient detail includes, but is not limited to, describing on Form 8886 when and how the taxpayer became aware of the transaction.
(c) Information required of Captive. For Captive, describing the transaction in sufficient detail includes, but is not limited to, describing the following on Form 8886:
(1) whether Captive is reporting because (i) the amount of the liabilities incurred by Captive for insured losses and claim administration expenses during the Computation Period is less than 70 percent of the amount specified in section 2.01(e)(1) of this notice; (ii) Captive has at any time during the Computation Period made available as financing or otherwise conveyed or agreed to make available or convey any portion of the payments under the Contract to A, Insured, or a person related (within the meaning of § 267(b) or 707(b)) to A or Insured through a separate transaction, such as a guarantee, a loan, or other transfer; or (iii) both (i) and (ii);
(2) under what authority Captive is chartered;
(3) a description of all the type(s) of coverage provided by Captive during the year or years of participation (if disclosure pertains to multiple years);
(4) a description of how the amounts treated as premiums for coverage provided by Captive during the year or years of participation (if disclosure pertains to multiple years) were determined, including the name and contact information of any actuary or underwriter who assisted in these determinations;
(5) a description of any claims paid by Captive during the year or years of participation (if disclosure pertains to multiple years), and of the amount of, and reason for, any reserves reported by Captive on the annual statement; and
(6) a description of the assets held by Captive during the year or years of participation (if disclosure pertains to multiple years); that is, the use Captive has made of its premium and investment income, including but not limited to, securities (whether or not registered), loans, real estate, or partnerships or other joint ventures, and an identification of the related parties involved in any transactions with respect to those assets.
.06 Penalties
Persons required to disclose these transactions under § 1.6011–4 who fail to do so may be subject to the penalty under § 6707A. Persons required to disclose these transactions under § 6111 who fail to do so may be subject to the penalty under § 6707(a). Persons required to maintain lists of advisees under § 6112 who fail to do so (or who fail to provide such lists when requested by the IRS) may be subject to the penalty under § 6708(a). In addition, the IRS may impose other penalties on parties involved in these transactions, including the accuracy-related penalty under § 6662 or § 6662A.
SECTION 4. REQUEST FOR COMMENTS
The Treasury Department and the IRS request comments on how the transaction might be addressed in published guidance.
Comments should be submitted in writing on or before January 30, 2017. Send submissions to CC:PA:LPD:PR (Notice 2016–66), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (Notice 2016–66), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, DC 20224. Comments may also be sent electronically, via the following e-mail address: Notice.comments@irscounsel.treas.gov. Please include “Notice 2016–66” in the subject line of any electronic communications. All comments submitted will be available for public inspection and copying.
(a) General rule. Under § 1.6011–4(d) and the Instructions to Form 8886, Reportable Transaction Disclosure Statement, the required disclosure must identify and describe the transaction in sufficient detail for the IRS to be able to understand the tax structure of the reportable transaction and the identity of all parties involved in the transaction.
ReplyDelete(b) Information required of all participants. For all participants, describing the transaction in sufficient detail includes, but is not limited to, describing on Form 8886 when and how the taxpayer became aware of the transaction.
(c) Information required of Captive. For Captive, describing the transaction in sufficient detail includes, but is not limited to, describing the following on Form 8886:
(1) whether Captive is reporting because (i) the amount of the liabilities incurred by Captive for insured losses and claim administration expenses during the Computation Period is less than 70 percent of the amount specified in section 2.01(e)(1) of this notice; (ii) Captive has at any time during the Computation Period made available as financing or otherwise conveyed or agreed to make available or convey any portion of the payments under the Contract to A, Insured, or a person related (within the meaning of § 267(b) or 707(b)) to A or Insured through a separate transaction, such as a guarantee, a loan, or other transfer; or (iii) both (i) and (ii);
(2) under what authority Captive is chartered;
(3) a description of all the type(s) of coverage provided by Captive during the year or years of participation (if disclosure pertains to multiple years);
(4) a description of how the amounts treated as premiums for coverage provided by Captive during the year or years of participation (if disclosure pertains to multiple years) were determined, including the name and contact information of any actuary or underwriter who assisted in these determinations;
(5) a description of any claims paid by Captive during the year or years of participation (if disclosure pertains to multiple years), and of the amount of, and reason for, any reserves reported by Captive on the annual statement; and
(6) a description of the assets held by Captive during the year or years of participation (if disclosure pertains to multiple years); that is, the use Captive has made of its premium and investment income, including but not limited to, securities (whether or not registered), loans, real estate, or partnerships or other joint ventures, and an identification of the related parties involved in any transactions with respect to those assets.
.06 Penalties
Persons required to disclose these transactions under § 1.6011–4 who fail to do so may be subject to the penalty under § 6707A. Persons required to disclose these transactions under § 6111 who fail to do so may be subject to the penalty under § 6707(a). Persons required to maintain lists of advisees under § 6112 who fail to do so (or who fail to provide such lists when requested by the IRS) may be subject to the penalty under § 6708(a). In addition, the IRS may impose other penalties on parties involved in these transactions, including the accuracy-related penalty under § 6662 or § 6662A.
SECTION 4. REQUEST FOR COMMENTS
The Treasury Department and the IRS request comments on how the transaction might be addressed in published guidance.
Comments should be submitted in writing on or before January 30, 2017. Send submissions to CC:PA:LPD:PR (Notice 2016–66), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (Notice 2016–66), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, DC 20224. Comments may also be sent electronically, via the following e-mail address: Notice.comments@irscounsel.treas.gov. Please include “Notice 2016–66” in the subject line of any electronic communications. All comments submitted will be available for public inspection and copying.
VEBA PLAN LLC leverages its years of experience with protecting taxpayers to help its clients navigate the complex world of captive insurance compliance, with its team of former high-ranking IRS executives, key congressional personnel and experienced litigators ensuring that each client has the strongest defense possible in the event of an audit.Doing What's Best For You Or Your ClientWhether You Are A CPA...If your client has a captive, you need to evaluate whether they are compliant or not. The IRS is looking at business owners with captives, as well as the CPAs and financial advisors that serve them.Let us help you and your client.Or A Business Owner...It doesn’t matter if you’re under audit or not, making sure your captive is compliant should be top priority.alliantNational can help lower the risk of the IRS cracking down on your insurance arrangement, and will dramatically improve your case against the agency if you are audited.What Is A Captive Insurance Company?Insurance costs can be a big problem for successful companies. Oftentimes a company may find that third party insurance is commercially unavailable or the commercial insurance that is available may be overly expensive. A company can put up its own capital to form a wholly owned subsidiary insurance company to solve these problems. These types of subsidiaries are known as captive insurance companies.Captive insurance companies can not only fill in gaps in existing coverage but they also provide deductibles on existing coverage. Contributions to the captive insurance company can also be tax deductions under Internal Revenue Code section 831(b). Captive insurance companies also provide pricing stability and program control. Small Captives are on the IRS hit list and are being audited. Want to fight IRS and get all your money back from the promoter who sold you the abusive Captive. As an expert witness Lance Wallach has never lost a case. His partners have decades of experience working for the IRS and as tax professors.
DeleteVEBA PLAN LLC leverages its years of experience with protecting taxpayers to help its clients navigate the complex world of captive insurance compliance, with its team of former high-ranking IRS executives, key congressional personnel and experienced litigators ensuring that each client has the strongest defense possible in the event of an audit.Doing What's Best For You Or Your ClientWhether You Are A CPA...If your client has a captive, you need to evaluate whether they are compliant or not. The IRS is looking at business owners with captives, as well as the CPAs and financial advisors that serve them.Let us help you and your client.Or A Business Owner...It doesn’t matter if you’re under audit or not, making sure your captive is compliant should be top priority.alliantNational can help lower the risk of the IRS cracking down on your insurance arrangement, and will dramatically improve your case against the agency if you are audited.What Is A Captive Insurance Company?Insurance costs can be a big problem for successful companies. Oftentimes a company may find that third party insurance is commercially unavailable or the commercial insurance that is available may be overly expensive. A company can put up its own capital to form a wholly owned subsidiary insurance company to solve these problems. These types of subsidiaries are known as captive insurance companies.Captive insurance companies can not only fill in gaps in existing coverage but they also provide deductibles on existing coverage. Contributions to the captive insurance company can also be tax deductions under Internal Revenue Code section 831(b). Captive insurance companies also provide pricing stability and program control. Small Captives are on the IRS hit list and are being audited. Want to fight IRS and get all your money back from the promoter who sold you the abusive Captive. As an expert witness Lance Wallach has never lost a case. His partners have decades of experience working for the IRS and as tax professors.
ReplyDeleteVEBA PLAN LLC leverages its years of experience with protecting taxpayers to help its clients navigate the complex world of captive insurance compliance, with its team of former high-ranking IRS executives, key congressional personnel and experienced litigators ensuring that each client has the strongest defense possible in the event of an audit.Doing What's Best For You Or Your ClientWhether You Are A CPA...If your client has a captive, you need to evaluate whether they are compliant or not. The IRS is looking at business owners with captives, as well as the CPAs and financial advisors that serve them.Let us help you and your client.Or A Business Owner...It doesn’t matter if you’re under audit or not, making sure your captive is compliant should be top priority.alliantNational can help lower the risk of the IRS cracking down on your insurance arrangement, and will dramatically improve your case against the agency if you are audited.What Is A Captive Insurance Company?Insurance costs can be a big problem for successful companies. Oftentimes a company may find that third party insurance is commercially unavailable or the commercial insurance that is available may be overly expensive. A company can put up its own capital to form a wholly owned subsidiary insurance company to solve these problems. These types of subsidiaries are known as captive insurance companies.Captive insurance companies can not only fill in gaps in existing coverage but they also provide deductibles on existing coverage. Contributions to the captive insurance company can also be tax deductions under Internal Revenue Code section 831(b). Captive insurance companies also provide pricing stability and program control. Small Captives are on the IRS hit list and are being audited. Want to fight IRS and get all your money back from the promoter who sold you the abusive Captive. As an expert witness Lance Wallach has never lost a case. His partners have decades of experience working for the IRS and as tax professors.
ReplyDeleteCaptive Insurance And The IRS
ReplyDeleteThe IRS continues to heavily scrutinize captive insurance arrangements. Certain captive insurance types have consistently appeared, including in 2019, on the IRS’s “Dirty Dozen” list of tax scams to avoid. Micro-captives in particular have been identified as potential vehicles for illegal tax shelters and the IRS is keen to crack down.
If the IRS believes that a captive insurance company is claiming deductions for non-insurance activities they will litigate. This includes going after captive insurance companies that are claiming unreasonable premium deductions. If the captive insurance company cannot show that they are distributing risk, selling insurance, shifting risk, or whether transactions involved insurance risk then that captive could be a target for the IRS.
Captive Insurance And The IRS
ReplyDeleteThe IRS continues to heavily scrutinize captive insurance arrangements. Certain captive insurance types have consistently appeared, including in 2019, on the IRS’s “Dirty Dozen” list of tax scams to avoid. Micro-captives in particular have been identified as potential vehicles for illegal tax shelters and the IRS is keen to crack down.
If the IRS believes that a captive insurance company is claiming deductions for non-insurance activities they will litigate. This includes going after captive insurance companies that are claiming unreasonable premium deductions. If the captive insurance company cannot show that they are distributing risk, selling insurance, shifting risk, or whether transactions involved insurance risk then that captive could be a target for the IRS.
The IRS has been cracking down on conservation easement transactions for over ten years. Nevertheless, taxpayers have continued to claim charitable contribution deductions attributable to the donation of conservation easements and promoters have continued to assemble investments utilizing conservation easement charitable deductions. The IRS began focusing on syndicated conservation easement transactions when it issued Notice 2017-10, designati
ReplyDeleteToday the IRS issued a press release announcing that it is significantly increasing enforcement actions for syndicated conservation easement donations and that these transactions are a priority compliance area for the agency. In the press release, the IRS stated that examinations of conservation easement donations are being coordinated across the agency. The IRS also announced that investigations relating to conservation easement deductions had been initiated by the IRS Criminal Investigation Division. Currently, there are more than 80 conservation easement cases pending in Tax Court, and the IRS outlined its commitment to bringing more cases to Tax Court where it believes the deduction should be disallowed.
ReplyDeleteToday the IRS issued a press release announcing that it is significantly increasing enforcement actions for syndicated conservation easement donations and that these transactions are a priority compliance area for the agency. In the press release, the IRS stated that examinations of conservation easement donations are being coordinated across the agency. The IRS also announced that investigations relating to conservation easement deductions had been initiated by the IRS Criminal Investigation Division. Currently, there are more than 80 conservation easement cases pending in Tax Court, and the IRS outlined its commitment to bringing more cases to Tax Court where it believes the deduction should be disallowed.
ReplyDeleteToday the IRS issued a press release announcing that it is significantly increasing enforcement actions for syndicated conservation easement donations and that these transactions are a priority compliance area for the agency. In the press release, the IRS stated that examinations of conservation easement donations are being coordinated across the agency. The IRS also announced that investigations relating to conservation easement deductions had been initiated by the IRS Criminal Investigation Division. Currently, there are more than 80 conservation easement cases pending in Tax Court, and the IRS outlined its commitment to bringing more cases to Tax Court where it believes the deduction should be disallowed.
ReplyDeleteToday the IRS issued a press release announcing that it is significantly increasing enforcement actions for syndicated conservation easement donations and that these transactions are a priority compliance area for the agency. In the press release, the IRS stated that examinations of conservation easement donations are being coordinated across the agency. The IRS also announced that investigations relating to conservation easement deductions had been initiated by the IRS Criminal Investigation Division. Currently, there are more than 80 conservation easement cases pending in Tax Court, and the IRS outlined its commitment to bringing more cases to Tax Court where it believes the deduction should be disallowed.
ReplyDeleteFor those wishing to protect their captive, we’ll get you compliant.
ReplyDeleteAnd for those facing an audit, we’ll be your defense.
Businesses have been creating captive insurance companies (CICs) for more than 100 years in order to manage risk while taking advantage of the tax benefits offered by the insurance arrangement.
However, the IRS has started to evaluate possible abuses surrounding CICs, and has begun examinations in the area. For those businesses who are unprepared when facing examination, there can be consequences.
alliantNational leverages its years of experience with protecting taxpayers to help its clients navigate the complex world of captive insurance compliance, with its team of former high-ranking IRS executives, key congressional personnel and experienced litigators ensuring that each client has the strongest defense possible in the event of an audit.
conservation easement tax court
ReplyDeletePublished on February 13, 2020
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The recent case of Harbor Lofts Associates, Crowninshield Corporation, Tax Matters Partner v. Commissioner, 151 T.C. No. 3 (Aug. 27, 2018) teaches yet another lesson on the importance of the perpetuity requirements when claiming a charitable deduction for the donation of a conservation easement. Last October I blogged about another conservation easement case, Palmolive Building Investors v. Commissioner, 149 T.C. No. 18 (Oct. 10, 2017). I did not get into the substance of the law in that blog, but instead focused on the Golsen rule and why the Tax Court needed to put its best analytical foot forward. I referred readers to Peter Reilly’s great blog post on Palmolive for the substance.
I encourage readers who don't know the Golsen rule to review the Golsen post, because Harbor Lofts is a case that the taxpayers may appeal to the First Circuit Court of Appeals. That is important because it’s the First Circuit who disagreed with the Tax Court’s position regarding the subordination requirement at issue in Palmolive. While today’s case involves a different part of the perpetuity requirement (and so there is no First Circuit precedent to bind the Tax Court), the Tax Court is again agreeing with the IRS in reading the perpetuity requirement strictly, this time finding that a long-term lease is not sufficient to meet the perpetuity requirements. If the Tax Court’s opinion is appealed to the First Circuit, the First Circuit may decide to take the same liberal interpretation of the perpetuity requirement as it did in Kaufman v. Shulman, 687 F.3d 21 (1st Cir. 2012), the case that was like Palmolive.
Today’s post will therefore comment on the Tax Court’s approach to interpreting the perpetuity requirements for conservation easements. Long story short, I agree with it. The First Circuit’s liberal approach, while understandable, is wrong. This post will explain why. To do so, I will have to dip into the substantive law with the caveat, as always, that what I say is subject to correction from alert readers who know this area better than I do. In particular, I will doubtless expose my ignorance by asking why the taxpayers did not structure the donation differently. It was likely for a reason that I just cannot see. The fun starts below the fold.
The Law: Getting To Perpetuity
Section 170(a) allows taxpayers a deduction for a “charitable contribution.” Section 170(c) defines that term as “a contribution or gift to or for the use of” a qualified organization and then lists the types of organizations that qualify. Section 170(f)(3)(B) generally disallows a “contribution... of an interest in property which consists of less than the taxpayer’s entire interest in such property....” Section 170(f)(3)(B) then carves out three exceptions to the general rule, the third one of which is for “a qualified conservation contribution.” Section §170(h)(1) says a contribution will be a qualified conservation contribution if it meets three requirements: (A) it is a qualified real property interest; (B) it is to a qualified organization; and (C) it is “exclusively for conservation purposes.” Section 170(h)(2) says a restriction on the use which may be made of real property can be a qualified real property interest for (h)(1)(A) purposes but only if the restriction is granted in perpetuity. Section §170(h)(5) imposes a second, independent, perpetuity requirement for the (h)(1)(C) requirement: it says that a “contribution shall not be treated as exclusively for conservation purposes unl
The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
ReplyDeleteIn late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
designated syndicated conservation easement arrangements
ReplyDeletePublished on February 18, 2020
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The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
ReplyDeletePublished on February 18, 2020
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The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
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The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
ReplyDeletePublished on February 18, 2020
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The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
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The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
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call firstStatus is online
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Speaker, author expert witness at VEBA LLC
188 articles
The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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designated syndicated conservation easement arrangements
ReplyDeletePublished on February 18, 2020
Edit article
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call firstStatus is online
call first
Speaker, author expert witness at VEBA LLC
188 articles
The Internal Revenue Service today urged taxpayers involved in designated syndicated conservation easement arrangements to consult with their tax advisors following a recent U.S. Tax Court decision and agency plans to continue enforcement efforts in this area.
In late 2016, the Internal Revenue Service designated certain syndicated conservation easement arrangements as "listed transactions" in Notice 2017-10 (PDF).
On Dec. 13, 2019, the U.S. Tax Court entered its first decision on a syndicated conservation easement transaction. In TOT Property Holdings, LLC v. Commissioner, Docket No. 005600-17, the Tax Court sustained in its entirety the IRS's determination that all tax benefits from a syndicated conservation easement transaction should be denied and that the 40% gross valuation misstatement and negligence penalties applied. The Tax Court found that the transaction failed the legal requirements applicable to donations of land easements and, in imposing the gross valuation misstatement penalty, found that the actual value of the easement donation was less than 10 percent of what was originally reported on the tax return.
"In denying the deductions and upholding the 40% gross valuation misstatement penalty, the Tax Court confirmed that aggressive syndicated easement transactions simply will not survive scrutiny," said IRS Commissioner Chuck Rettig. "We will not stop in our coordinated pursuit of these abusive transactions while seeking the imposition of all available civil penalties and, when appropriate, various criminal options for those involved."
"If you engaged in any questionable syndicated conservation easement transaction, you should immediately consult an independent, competent tax advisor to consider your best available options," Rettig added.
Tax Court trials in four other syndicated easement cases were conducted earlier this year and more than 50 cases are pending. In other recent cases, the Tax Court has rejected arguments that various regulations taxpayers failed to comply with are invalid, essentially negating one of these taxpayers' main defenses.
"We are prepared to take each of these and all other cases being developed by the IRS to trial, although the substance of most cases can be resolved without trial because the transactions do not meet the basic requirements to claim the charitable contribution deduction," said IRS Chief Counsel Mike Desmond. "We encourage taxpayers and their advisors to see the writing on the wall and take immediate steps to resolve these matters."
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AMANDA J. ANDREWS ASSOCIATE COUNSEL, LEGAL DIVISION ARKANSAS INSURANCE DEPARTMENT
ReplyDelete"Mr. Wallach, Thank you for providing me with this information. I will review it next week and, I’m sure, be in touch. I very much appreciate your help."
AMANDA J. ANDREWS ASSOCIATE COUNSEL, LEGAL DIVISION ARKANSAS INSURANCE DEPARTMENT
ReplyDelete"Mr. Wallach, Thank you for providing me with this information. I will review it next week and, I’m sure, be in touch. I very much appreciate your help."
The IRS wants to know whether you traded cryptocurrency in 2019, a question it had never overtly asked taxpayers in the past.
ReplyDeleteIn a new report on Monday covering fiscal 2019, the agency listed cryptocurrency and the gig economy as two key “emerging compliance areas that require attention” by the IRS. For crypto, that attention is taking the form of a new question on the 2019 Form 1040 (for additional income).
The question is at the very top of the form, and reads: “At any time during 2019, did you receive, sell, send, exchange or otherwise acquire any financial interest in any virtual currency?”
Lance WallachJanuary 6, 2020 at 5:33 PM
ReplyDeleteLance Wallach, CLU, ChFC, CIMC, the National Society of Accountants Speaker of the Year, consults on abusive tax shelters, captive insurance, conservation easements,bitcoin, ,insurance, estate planning, retirement and employee benefit plans,419,412i,section 79 plans and other IRS audit targets etc. As an expert witness his side has never lost a case.
Lance Wallach advised thousands of high-income clients including hundreds of famous entertainers and athletes about captive insurance, 419, 412i section 79 and other abusive tax shelters. Lance also counseled famous Wall Street luminaries such as Hugh Downs and Louis Rukeyser, the host of 2 long-running programs Wall Street Week with Louis Rukeyser & Louis Rukeyser’s Wall Street.
Speaker at over 50 annual conventions and author for more than 500 publications on tax reduction ideas, abusive welfare benefit and retirement plans, captive insurance companies,abusive tax shelters and conservation easements, cash balance plans, life settlements, premium finance, and more. He is a course developer and instructor for Continuing Professional Education courses administered by
The American Institute of Certified Public Accountants.
Lance is a prolific author, having written or collaborated on numerous books, including 'The CPA Guide to Life Insurance', published by BISK Education, 'The Team Approach to Tax and Financial Planning', published by the American Institute of CPA s, and most recently 'Protecting Clients from Fraud, Incompetence, and Scams', published by Wiley. He has been hired as an expert witness on some issues of which he speaks about, and to this day, Lance Wallach has never lost a case.
Lance Wallach has appeared on radio and TV financial programs, most recently, on National Public Radio and NBC 25. Lance consults on abusive tax shelters like 412i,419, section 79, captive insurance bitcoin, easements, tax shelters and VEBA Plans.
Additionally, Lance Wallach's expertise is sought after by the U.S. Securities and Exchange Commission, U.S. Department of Labor, the Enforcement Unit of the IRS The State Inusrance Dept etc.