IRS Insights Archive
IRS Insights, published by the Deloitte Tax LLP Tax Controversy Services group, provides a compact, reader-friendly perspective on the latest practices and procedures coming out of the Internal Revenue Service (IRS), as well as the potential impact of changes on taxpayers.
- Ninth Circuit Affirms in Part and Reverses in Part District Court Decision, Holding that IRS Timely Assessed Tax on Lower-Tier Partnership for Liability Attributable to Partnership Flow-Through Items of Upper-Tier Partnership where Extension Agreements Referred to Upper-Tier Partnership Only
- In Candyce Martin 1999 Irrevocable Trust v. United States, 2014 U.S. App. LEXIS 605, the Ninth Circuit Court of Appeals affirmed in part and reserved in part the decision of the U.S. District Court for the Northern District of California. On de novo review, the Ninth Circuit concluded that the assessment statute was still open and remanded to the district court for determination of which adjustments in the Notice of Final Partnership Administrative Adjustment were “directly attributable to partnership flow-through items” of the upper-tier partnership referenced in the extension agreements.
- LB&I Issues Directive on the Definition of Milestone and Directs Examiners as to When to Challenge Treatment of Eligible Milestone Payments in Connection with the Safe Harbor of Rev. Proc. 2011-29, for LB&I Taxpayers
- On January 27, 2014, the Commissioner of the Large Business & International (“LB&I”) Division distributed “Updated Guidance on the Examination of Milestone Payments in the Acquisition of Businesses” in a memorandum addressed to LB&I Employees, LB&I Directive 04-0114-001. The directive states that, if a taxpayer meets certain requirements, LB&I examiners should not challenge a taxpayer’s treatment of eligible milestone payments made or incurred in the course of a covered transaction for which the taxpayer incurs a success-based fee.
- IRS Enforcement Statistics for FY 2013
- The Internal Revenue Service recently released the Fiscal Year 2013 Enforcement and Service Results. These statistics provide insight about the current level of IRS activities in the following areas: audit, collection and taxpayer service. The report shows a significant increase in enforcement revenue for Fiscal Year 2013, as compared to Fiscal Year 2012.
- Loving v. IRS, 2014 U.S. App. LEXIS 2512 (D.C. Cir. 2014)
- The Court of Appeals for the DC Circuit recently affirmed the District Court’s decision in Loving v. IRS, 917 F.Supp. 2d 67 (D.D.C. 2013) holding that the Internal Revenue Service was not able to extend Circular 230 provisions to tax return preparers, including currently un-enrolled individuals who prepare all or substantially all of a tax return or claim for refund for compensation.
- Coordinated Issue Papers
- On January 21, 2014, the Internal Revenue Service issued a Large Business & International (“LB&I) Directive LB&I-04-0114-002 (“Directive”) de-coordinating all current Coordinated Issue Papers. Coordinated Issue Papers were technical guidance setting forth the Internal Revenue Service’s position with respect to certain issues and were binding upon its examiners. All coordinated issue papers were de-coordinated as of the Directive’s issuance date.
U.S. Supreme Court Holds Valuation Misstatement Penalty May Apply When Underlying Deduction or Credit is Disallowed for Reasons Not Specifically Attributable to a Valuation Overstatement
Tax Controversy Updates: Large Business & International Directive on New Policy for Information Document Requests and Updated Enforcement Procedures
Tax Controversy Updates: Tax Court Determines FPAA sent to Valid Address for TMP and Grants IRS Motion to Dismiss
Tax Controversy Updates: IRS Issues Large Business & International Directive Setting Forth Updated Policy for Information Document Requests
Tax Controversy Updates: IRS Chief Counsel Memorandum: Restricted Consent Agreements Extend Refund Statute Only for Items Identified in Consent