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Penalty Abatement

Washington Alert – TIGTA Report on Appeals decisions on penalty abatement; US & Portugal sign IGA; Reminder – E-File Application

Washington Alert – TIGTA Report on Appeals decisions on penalty abatement; US & Portugal sign IGA; Reminder – E-File Application

The IRS Office of Appeals (Appeals), in many of the cases reviewed, correctly accepted cases in which agency operating divisions had previously denied the taxpayer’s request for abatement and provided sufficient documentation of the reasons for penalty abatements in case files, according to an audit released on Aug. 21 by the Treasury Inspector General for […]

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Permanent program provides penalty relief for delinquent non-Title I retirement plans

Permanent program provides penalty relief for delinquent non-Title I retirement plans

Rev Proc 2015-32, 2015-24 IRB 1 In a Revenue Procedure, IRS has established a permanent program that provides Code Sec. 6652(e) and Code Sec. 6692 penalty relief for delinquent Form 5500 series filers that aren’t covered under Title I of the Employee Retirement Income Security Act of 1974 (ERISA)—i.e., “one-participant plans” and certain foreign plans. […]

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Pilot program provides penalty relief for delinquent non-Title I retirement plans

Pilot program provides penalty relief for delinquent non-Title I retirement plans

In Rev Proc 2014-32, 2014-23 IRB, IRS has established a temporary one-year pilot program to provide Code Sec. 6652(e) and Code Sec. 6692 penalty relief for delinquent Form 5500 series filers that aren’t covered under Title I of the Employee Retirement Income Security Act of 1974 (ERISA) – i.e., “one-participant plans” and certain foreign plans. […]

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IRS provides administrative relief from certain information reporting penalties

IRS provides administrative relief from certain information reporting penalties

In Notice 2014-35, 2014-23 IRB, IRS has provided administrative relief from the penalties under Code Sec. 6652(d), Code Sec. 6652(e), and Code Sec. 6692 for a failure to timely comply with certain annual reporting requirements under Code Sec. 6047(e), Code Sec. 6057, Code Sec. 6058 , and Code Sec. 6059. This administrative relief applies to […]

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Knappe v U.S. – Taxpayer must pay late-filing penalty because he filed untimely estate-tax return based on incorrect advice

Knappe v U.S. – Taxpayer must pay late-filing penalty because he filed untimely estate-tax return based on incorrect advice

The Ninth Circuit Court of Appeals decided, in Knappe v. U.S. (D.C. Central, Los Angeles), Case No. 2:09-cv-07328-DMG-PJW, that the taxpayer must pay the late-filing penalty because he filed an untimely estate-tax return based on incorrect advice from an accountant regarding extension deadlines. This is a decision that hurts; feels to me like the Court […]

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Federal Court of Appeals, Fifth Circuit, affirms FOCus strategy lacked economic substance, but vacates stacked penalties

Federal Court of Appeals, Fifth Circuit, affirms FOCus strategy lacked economic substance, but vacates stacked penalties

The Court of Appeals for the Fifth Circuit, in Nevada Partners Fund, LLC, etc., et., al., v. United States of America, 111 AFTR  2d ¶ 3013-841, has affirmed a district court decision that a series of transactions undertaken pursuant to an “investment strategy” lacked economic substance and was an abusive tax shelter designed to allow investors […]

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Estate’s late filing wasn’t justified beyond time surviving spouse became a citizen

Estate’s late filing wasn’t justified beyond time surviving spouse became a citizen

The Court of Federal Claims, in Estate of Morton Liftin v. U.S., (Ct Fed Cl 03/29/2013) 111 AFTR 2d ¶ 2013-587, has upheld IRS’s imposition of a penalty on an estate for its late filing of the estate tax return. A difficult question of law surrounding the availability of the marital deduction for transfers to the […]

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Penalty Relief Available to Some Storm Victims Unable To File On Time

Penalty Relief Available to Some Storm Victims Unable To File On Time

April 15, 2013: The IRS announced today that it will provide penalty relief to anyone unable to file on time due to severe storms in parts of the South and Midwest over the past few days. Power outages and transportation problems are, in some cases, making it very difficult or impossible for some taxpayers and […]

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TIGTA Report: Penalty Abatement Procedures Should Be Applied Consistently To All Taxpayers And Should Encourage Voluntary Compliance

TIGTA Report: Penalty Abatement Procedures Should Be Applied Consistently To All Taxpayers And Should Encourage Voluntary Compliance

TIGTA Report:  Penalty Abatement Procedures Should Be Applied Consistently To All Taxpayers And Should Encourage Voluntary Compliance. IMPACT ON TAXPAYERS The Internal Revenue Code imposes a Failure to File (FTF) penalty for failing to file a tax return and a Failure to Pay (FTP) penalty for failing to pay the tax shown on any tax […]

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Reliance on accountant may avoid penalty for failure to file foreign trust form

Reliance on accountant may avoid penalty for failure to file foreign trust form

Editor’s Note:  this has the potential to be a good case as it survived the Government’s Motion for Summary Judgment as the taxpayer showed “reasonable cause and not willful neglect.”  I actually went on-line on PACER and pulled some of the filed pleadings which are listed below and linked. Here’s the case of Brian Chivas […]

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Tax Court in Hristov holds that reliance on professional does not meet reasonable cause to avoid accuracy related penalties

Tax Court in Hristov holds that reliance on professional does not meet reasonable cause to avoid accuracy related penalties

Editor’s Note:  this is a good example of a case which sought to abate penalties based upon reasonable cause and reliance on a professional. In hindsight, it is a good case that should not have been litigated since there were many, many problems.  It is, nevertheless, illustrative of what the Courts look for in determining […]

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IRS Updated Publication 1586 details increased penalties for information reporting errors and omissions

IRS Updated Publication 1586 details increased penalties for information reporting errors and omissions

Publication 1586, IRS’s Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs.  Click here for the text of IRS’s “Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs.” IRS has updated Publication 1586, “Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs.” It provides taxpayers with the information needed to avoid penalties […]

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IRS Tips and advice to Taxpayers don’t go far enough when responding to IRS letters and notices

IRS Tips and advice to Taxpayers don’t go far enough when responding to IRS letters and notices

Editor’s Note:  below is the IRS tip entitled “Eight Facts to Know if You Receive an IRS Letter or Notice.”  I would add a few more tips as well:  (1). make certain that whatever correspondence you send in response is sent via certified mail, return receipt requested from the U.S. Post Office as proof of […]

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Missed the Income Tax Deadline – IRS Offers Help for Taxpayers

Missed the Income Tax Deadline – IRS Offers Help for Taxpayers

Missed the Income Tax Deadline – IRS Offers Help for Taxpayers The IRS has some advice for taxpayers who missed the tax filing deadline. Don’t panic but file as soon as possible. If you owe money the quicker you file your return, the less penalties and interest you will have to pay. Even if you […]

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California Limited Liability Companies – No reasonable cause for late filing

California Limited Liability Companies – No reasonable cause for late filing

Editor’s Note:  This is another “penalty abatement” case, and is a good example of why ample documentation in penalty abatement cases are an absolute “must.” In Appeal of 4837 Beverly Boulevard, LLC, SBE, Case No. 524173, 10/25/2011 (not to be cited as precedent), the State Board of Equalization (SBE) has rejected a taxpayer’s appeal of […]

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California Personal Income Tax – Imposition of penalties; cancer does not matter

California Personal Income Tax – Imposition of penalties; cancer does not matter

Editor’s Note: Penalties, it has been said, are often times worse than the tax liability.  Coupled with the “interest” meter (which runs until the total tax bill is completely satisfied), it is no wonder that taxpayers are frustrated with their tax bill.  Frequently taxpayers ask me if we can “get rid of” penalties (the proper […]

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IRS Alert!: New IRS Fresh Start Initiative Helps Taxpayers Who Owe Taxes

IRS Alert!: New IRS Fresh Start Initiative Helps Taxpayers Who Owe Taxes

New IRS Fresh Start Initiative Helps Taxpayers Who Owe Taxes Editor’s Note:  The Internal Revenue Service has expanded its “Fresh Start” initiative to help struggling taxpayers who owe taxes.  As time goes on, we’ll track how well the IRS follows their procedures, particularly with respect to the new criteria for Offers in Compromise. Stay tuned […]

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Case Alert: Penalty Upheld for Estate Tax Return Filed Late by Sick Attorney – No Reasonable Cause Established

Case Alert: Penalty Upheld for Estate Tax Return Filed Late by Sick Attorney – No Reasonable Cause Established

Editor’s Note: This is a tough case because more often than not, late filing and/or late payment penalties regarding Estate tax returns are met with disapproval at the IRS.  Indeed, the majority of the reported cases show the IRS victorious.  In the last few years, I’ve handled quite a few of these cases.  I’ve been retained […]

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Treasury, IRS Issue Proposed Regulations for FATCA Implementation

Treasury, IRS Issue Proposed Regulations for FATCA Implementation

Treasury, IRS Issue Proposed Regulations for FATCA Implementation Note:  It will be interesting to see the comments to the Proposed Regulations.  Another article will discuss the Proposed Regulations. WASHINGTON – The Treasury Department and the Internal Revenue Service today issued proposed regulations for the next major phase of implementing the Foreign Account Tax Compliance Act […]

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FATCA: What’s It All About, Alfie? – Do I need to file Form 8938, Statement of Specified Foreign Financial Assets?

FATCA: What’s It All About, Alfie? – Do I need to file Form 8938, Statement of Specified Foreign Financial Assets?

Certain U.S. taxpayers holding specified foreign financial assets with an aggregate value exceeding $50,000 will report information about those assets on new Form 8938, which must be attached to the taxpayer’s annual income tax return. Higher asset thresholds apply to U.S. taxpayers who file a joint tax return or who reside abroad (see below).Form 8938 […]

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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