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Domestic production activities deduction

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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Temp regs cover allocation of Sec. 199 wages in short tax year and in acquisition or disposition

Temp regs cover allocation of Sec. 199 wages in short tax year and in acquisition or disposition

T.D. 9731, 08/26/2015, Reg. § 1.199-2, Reg. § 1.199-2T, Reg. § 1.199-8, Reg. § 1.199-8T IRS has issued temporary regs that provide guidance for purposes of the Code Sec. 199 domestic production activities deduction (DPAD) on the allocation of W-2 wages paid by two or more taxpayers that are employers of the same employees during […]

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IRS clarifies timing of income tax effects of retroactive extension of fuel tax credits

IRS clarifies timing of income tax effects of retroactive extension of fuel tax credits

Notice 2015-56, 2015-35 IRB In a Notice, IRS has provided that the required income tax addback for the credits for biodiesel fuel blenders and for certain sales or uses of alternative fuels, that were earned as a result of the retroactive extension of those credits by the Tax Increase Prevention Act of 2014 (the Act), […]

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Taxpayer properly allocated deductions in computing domestic production deduction

Taxpayer properly allocated deductions in computing domestic production deduction

Chief Counsel Advice 201446018 In Chief Counsel Advice (CCA), IRS has concluded that, for purposes of computing its domestic production activities deduction (DPAD), a taxpayer properly allocated to tax years that preceded the effective date of the DPAD, amounts that it paid as damage awards. Note: IRS’s conclusion here meant that the taxpayer could take […]

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Photo processing and printing are manufacturing activities for purposes of DPAD

Photo processing and printing are manufacturing activities for purposes of DPAD

In Legal Advice Issued by Field Attorneys (LAFA) 2013-3302F, IRS has determined that the photo processing activities of a drugstore chain constitute the manufacturing, production, growth, or extraction (MPGE) of qualifying production property (QPP) for purposes of the taxpayer’s domestic production activities deduction (DPAD) under Code Sec. 199. However, affixing images provided by a customer […]

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Production of gift baskets gave rise to domestic production activities deduction

Production of gift baskets gave rise to domestic production activities deduction

A district court in U.S. v. Dean (2013 DC CA) 112 AFTR 2d ¶ 2013-5164 has determined that an S corporation’s production process for putting together gift baskets of various food and wine items qualified it for the domestic production activities deduction under Code Sec. 199. In so holding, the court found that the process […]

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No domestic production activities deduction for production of electronic books

No domestic production activities deduction for production of electronic books

In Chief Counsel Advice (CCA) 201313020, IRS has determined that a book publisher’s activities of producing an electronic book do not qualify for the Code Sec. 199 domestic production activities deduction. Background. Businesses can claim a domestic production activities deduction under Code Sec. 199 to offset income from domestic manufacturing and other domestic production activities. […]

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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