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Blog & Articles

As oil boom goes bust, Oklahoma protects drillers and squeezes schools

NEWCASTLE, Okla. (Reuters) – After intense lobbying, Oklahoma’s oilmen scored a victory two years ago. State lawmakers voted to keep in place some of the lowest taxes on oil and gas production in the United States – a break worth $470 million in fiscal year 2015 alone. The state’s schools haven’t been so fortunate. In […]

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Pending appeal of criminal conviction motion doesn’t affect timing of restitution assessment

Pending appeal of criminal conviction motion doesn’t affect timing of restitution assessment

Chief Counsel Advice 201616011 In an emailed Chief Counsel Advice, IRS has concluded that the fact that an individual has a pending appeal of his motion to vacate his criminal conviction does not affect IRS’s ability to assess the amount of criminal restitution owed it under a court order. Background. 18 USC 3556 provides for mandatory […]

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Easement clause failed to protect charity in perpetuity, so no charitable deduction

Easement clause failed to protect charity in perpetuity, so no charitable deduction

Carroll, (2016) 146 TC No. 13 The Tax Court has held that a clause in an easement, which provided for the amount the donee would receive if conditions caused an extinguishment of the perpetual conservation restriction, did not meet the requirements of a reg under the charitable deduction Code section that requires that a conservation […]

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U.S. judge hands win to Republicans in Obamacare challenge

U.S. judge hands win to Republicans in Obamacare challenge

WASHINGTON (Reuters) – A U.S. judge on Thursday handed a victory to congressional Republicans who challenged President Barack Obama’s signature healthcare law, ruling that his administration overstepped its constitutional powers relating to government spending. U.S. District Judge Rosemary Collyer, based in Washington, ruled that the administration cannot spend billions of dollars in federal funds to […]

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Final, temporary & proposed regs explain new PEO voluntary certification program

Final, temporary & proposed regs explain new PEO voluntary certification program

IR 2016-74 T.D. 9768, “Certified Professional Employer Organizations; Final and Temporary Regulations.” Proposed Regs [REG-127561-15], “Certified Professional Employer Organizations; Notice of Proposed Rulemaking and Notice of Proposed Rulemaking by Cross-Reference to Temporary Regulations.” IRS has issued final and temporary regs implementing a new voluntary certification program for professional employer organizations (PEOs), which was authorized by […]

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Recent proposed Code Sec. 385 (debt versus equity) regs would bring sweeping changes

Recent proposed Code Sec. 385 (debt versus equity) regs would bring sweeping changes

Preamble to Prop Reg 04/05/2016; Prop Reg § 1.385-1, Prop Reg § 1.385-2, Prop Reg § 1.385-3, Prop Reg § 1.385-4 If finalized, recently issued proposed Code Sec. 385 regs would introduce sweeping changes to the treatment of related-party indebtedness, including extensive due diligence and documentation requirements (which would be applicable to cash pooling arrangements). […]

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Interests in partnership investing in student loans treated as obligations in registered form

Interests in partnership investing in student loans treated as obligations in registered form

PLR 201614026 In a private letter ruling (PLR), IRS has concluded that interests in a partnership organized to invest in student loans using funds from domestic feeder and foreign feeder partnerships will be treated as being obligations in registered form for purposes of Code Sec. 163(f)(1). Background. Under Code Sec. 163(f)(1), there’s no deduction for interest […]

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A guide to drawing down your savings in retirement

A guide to drawing down your savings in retirement

As reported in the LA Times, “A guide to drawing down your savings in retirement.” The approach of retirement should be an exciting time for 50- and 60-somethings. But when the issue is your finances — and whether you’ve saved enough to last the rest of your life — excitement can quickly be overridden by […]

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Tax Court – No IRS abuse in rejecting offer-in-compromise where taxpayer had cash and receivables

Tax Court – No IRS abuse in rejecting offer-in-compromise where taxpayer had cash and receivables

Strong, TC Memo 2016-70 The Tax Court has upheld IRS’s rejection of a taxpayer’s offer-in-compromise (OIC) that was based on doubt as to collectibility. The Court rejected the taxpayer’s argument that IRS abused its discretion by considering his business receivables as business assets for purposes of the OIC.  Click here for the Opinion of the […]

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Taxpayer had to compute depletion allowance under two separate methods

Taxpayer had to compute depletion allowance under two separate methods

Legal Advice Issued by Field Attorneys 20161401F In a redacted Legal Advice Issued by Field Attorneys (LAFA), IRS has concluded that where a taxpayer that mined minerals and used some of its mined mineral to manufacture certain products, it had to perform two Code Sec. 613 percentage depletion allowance calculations: one for the mineral it […]

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Social service groups sue Illinois for $100 million over unpaid work

Social service groups sue Illinois for $100 million over unpaid work

CHICAGO (Reuters) – Dozens of Illinois social service providers, starved of cash by the state’s long-running budget stalemate, sued Illinois Governor Bruce Rauner and six statewide agencies on Wednesday, seeking more than $100 million for unpaid work since July. The plaintiffs, who provide services for sex-abuse victims, the homeless, senior citizens and at-risk youth, are suffering […]

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IRS issues inflation-adjusted health savings account figures for 2017

IRS issues inflation-adjusted health savings account figures for 2017

Rev Proc 2016-28, 2016-20 IRB A new revenue procedure provides the annual inflation-adjusted contribution, deductible, and out-of-pocket expense limits for 2017 for health savings accounts (HSAs). HSA basics. Eligible individuals may, subject to statutory limits, make deductible contributions to an HSA. Employers as well as other persons (e.g., family members) also may contribute on behalf of […]

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Final regs allow wider range of foundation program-related investments

Final regs allow wider range of foundation program-related investments

T.D. 9762, 04/21/2016; Reg. § 53.4944-3 IRS has issued final regs that provide guidance to private foundations on program-related investments (PRIs) — i.e., certain types of investments made by private foundations for charitable purposes that are excepted from treatment as “jeopardizing investments” subject to excise tax under Code Sec. 4944. The final regs, which largely […]

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Washington Alert – IRS LITC application period is underway; Estimated federal budget deficit; IRS webinar May 19 titled “Understanding the Universal Availability Rules in a 403(b) Retirement Plan”

Washington Alert – IRS LITC application period is underway; Estimated federal budget deficit; IRS webinar May 19 titled “Understanding the Universal Availability Rules in a 403(b) Retirement Plan”

The application period for the 2017 Low Income Taxpayer Clinic (LITC) grant process is now underway and will run through June 20. (IR 2016-70) The LITC program awards matching grants of up to $100,000 per year to qualifying organizations for the development, expansion or maintenance of a LITC. As described by IRS, LITCs offer assistance […]

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Bits ‘n Pieces – Taxing Harvard, Yale, Stanford; IRS adds 700 employees to chase tax cheats; CA Gov. Brown signs bills to raise smoking age to 21, restrict e-cigarettes, Tattered tax net; Tax court rules international waters not foreign country but misses that mariners are not marines

Bits ‘n Pieces – Taxing Harvard, Yale, Stanford; IRS adds 700 employees to chase tax cheats; CA Gov. Brown signs bills to raise smoking age to 21, restrict e-cigarettes, Tattered tax net; Tax court rules international waters not foreign country but misses that mariners are not marines

* Is taxing Harvard, Yale and Stanford the answer to rising college costs? Timothy W. Martin and Melissa Korn – The Wall Street Journal. Elite U.S. schools have grown richer since the 2008 financial crisis by investing their endowment money in everything from California vineyards to Chinese startups. State and federal policy makers now want […]

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Senator and others’ challenge to foreign account reporting regime dismissed

Senator and others’ challenge to foreign account reporting regime dismissed

Crawford, et al, v. Dept. of the Treasury, et al, (4/26/2016 DC OH) 117 AFTR 2d ¶2016-650 A district court has dismissed a suit brought by Senator Rand Paul (R-KY) and several individual plaintiffs challenging the Foreign Account Tax Compliance Act (FATCA) and Foreign Bank Account Report (FBAR) requirements. The court found that Senator Paul’s […]

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AOTC denied for year following the year in which tuition was prepaid

AOTC denied for year following the year in which tuition was prepaid

McCarville, TC Summary Opinion 2016-14 In a summary opinion, the Tax Court has held that a cash-basis, calendar-year taxpayer who prepaid college tuition expenses for a semester that began during the first three months of the following year could not claim the American Opportunity Tax Credit (AOTC) for the year in which the semester began. […]

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Trump retreats on comments on raising taxes on the wealthy

Trump retreats on comments on raising taxes on the wealthy

WASHINGTON (Reuters) – Republican presidential candidate Donald Trump on Monday backtracked on his remarks about raising taxes on wealthy Americans, saying the rich might simply get a smaller tax cut than he originally proposed. Trump walked away from his comment on Sunday that taxes on the wealthy would “go up” once his broad tax policy […]

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Sanders plan raises incomes but also U.S. deficits, analysts say

Sanders plan raises incomes but also U.S. deficits, analysts say

NEW YORK (Reuters) – U.S. Democratic presidential candidate Bernie Sanders’ tax and benefit plans would raise income for most Americans but his proposal for single-payer healthcare would help generate record federal deficits, two Washington think tanks said on Monday. An analysis by the Tax Policy Center said that although most people would pay higher taxes […]

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Tax Court – donee received only life insurance protection, so split dollar economic benefit regime applied

Tax Court – donee received only life insurance protection, so split dollar economic benefit regime applied

Estate of Morrissette, (2016) 146 TC No. 11 The Tax Court has examined the terms of a split dollar life insurance arrangement, determined that the party that received the funds to pay the premiums from the other party received no economic benefit other than current life insurance protection, and therefore ruled that the “economic benefit […]

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Meet Paul Raymond

Meet Paul Raymond

Mr. Raymond is a sought after speaker in tax controversy law by many attorney, accountant, and business groups and at the request of the Internal Revenue Service, has presented programs at the IRS Nationwide Tax Forum, attended by tax professionals throughout the United States.

Additionally, he continues to be an active member in the Section of Taxation, American Bar Association, where he was the Past Chair of the Employment Taxes Committee.

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Member CA Bar Member Orange County Bar US Tax Court Attorney