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Blog & Articles

For PAL rules, realty exec’s work for entity counted as work for his own realty interests

For PAL rules, realty exec’s work for entity counted as work for his own realty interests

Stanley vs. U.S., (DC AK 11/12/2015) 116 AFTR 2d ¶ 2015-5419 A district court has ruled that, for purposes of the real estate professional’s exception to the passive activity loss (PAL) rules, a real estate management executive who also owned interests in the properties managed by his firm, may count his work for the entity […]

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Clinton aims to stop ‘earnings stripping’ to curb inversion deals

Clinton aims to stop ‘earnings stripping’ to curb inversion deals

WATERLOO, Iowa (Reuters) – U.S. Democratic presidential candidate Hillary Clinton will continue her push to crack down on companies that shift profits overseas, at a campaign stop on Wednesday in Iowa, where she will unveil her plan to rein in the practice, known as earnings stripping. Clinton is spending this week detailing how she will […]

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Facebook’s Zuckerberg: No tax benefit from philanthropic initiative

Facebook’s Zuckerberg: No tax benefit from philanthropic initiative

SAN FRANCISCO/BENGALURU (Reuters) – Facebook Inc Chief Executive Mark Zuckerberg said on Thursday he and his wife would receive no tax benefit from setting up their new philanthropic endeavor as a limited liability company and hinted at the types of efforts it would support. In a post on his Facebook page, he wrote that “just […]

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Washington Alert – Swiss Bank Program Report; GAO on IRS Whistleblower Office; TIGTA reportFederal Information Security Modernization Act (FISMA) evaluation of IRS for fiscal year 2015

Washington Alert – Swiss Bank Program Report; GAO on IRS Whistleblower Office; TIGTA reportFederal Information Security Modernization Act (FISMA) evaluation of IRS for fiscal year 2015

Since late October, the Justice Department has announced 15 settlements with Swiss financial institutions pursuant to the provisions of the Swiss Bank Program. Most of the settlements involved hefty financial penalties with the largest penalty reaching nearly $60 million. The Swiss Bank Program provides a path for Swiss banks to resolve potential criminal liabilities in […]

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Notice clarifies requirements for tax-exempt bond financing for State Supplemental Loan programs

Notice clarifies requirements for tax-exempt bond financing for State Supplemental Loan programs

Notice 2015-78, IRB 2015-48 In a Notice, IRS has provided guidance on qualified student loan bonds under Code Sec. 144(b) to clarify certain requirements for tax-exempt bond financing for State Supplemental Loan programs. Background. Under Code Sec. 144(b)(1), a qualified student loan bond for which tax-exempt private activity bonds may be issued means any bond […]

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District court upholds interest deductions and foreign tax credits from STARS transaction

District court upholds interest deductions and foreign tax credits from STARS transaction

Santander Holdings USA Inc. & Subsidiaries v. U.S., (DC MA 11/13/2015) 116 AFTR 2d ¶2015-5425 A district court has determined on summary judgment that a Structured Trust Advantaged Repackaged Securities (STARS) transaction had economic substance and that a participating bank was entitled to claim interest deductions and foreign tax credits stemming from participation in it. […]

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EU set to investigate McDonald’s tax deal with Luxembourg

EU set to investigate McDonald’s tax deal with Luxembourg

BRUSSELS (Reuters) – EU antitrust regulators are likely to widen their crackdown on corporate tax dodging with an investigation into a deal between fast-food chain McDonald’s and Luxembourg, two people with knowledge of the matter said on Wednesday. Deals helping multinationals slash their tax bills to minimal amounts of as little as 1 percent or below […]

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Drug maker seeking FDA OK for generic drug must capitalize patent infringement defense costs

Drug maker seeking FDA OK for generic drug must capitalize patent infringement defense costs

Legal Advice Issued by Field Attorneys 20154502F In Legal Advice issued by Field Attorneys (LAFA), IRS has concluded that a drug company must capitalize under Code Sec. 263 legal fees it paid in defending against a patent infringement lawsuit that was filed as part of the complex process of obtaining FDA approval for a generic […]

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Puerto Rico avoids second default, but future payments uncertain

Puerto Rico avoids second default, but future payments uncertain

NEW YORK/SAN JUAN (Reuters) – Puerto Rico made a crucial debt payment on Tuesday but warned that its deteriorating finances could trigger future defaults, as the governor granted the U.S. territory power to take revenues from public agencies. There had been speculation Puerto Rico would default on all or part of the $355 million notes […]

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Proposal Offers Clarification of Definition of a Business for U.S. GAAP

Proposal Offers Clarification of Definition of a Business for U.S. GAAP

A FASB proposal offers a clarification of the definition of a business by adding guidance to help determine whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The accounting board said it has received complaints that the current definition of a business is applied too broadly and requires many transactions […]

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No rehearing of pre-enforcement challenge to nonresident alien reporting regs

No rehearing of pre-enforcement challenge to nonresident alien reporting regs

Florida Bankers Assn., et al, v. U.S. Dept. of Treas., (CA Dist Col 11/05/2015) 116 AFTR 2d ¶2015-5404 The Court of Appeals for the District of Columbia Circuit has denied two banking associations’ request for rehearing of their challenge to regs that require U.S. banks to report to IRS the amount of interest paid to […]

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IRS offers tips for 2015 year-end charitable contributions

IRS offers tips for 2015 year-end charitable contributions

IR 2015-134 In a news release, IRS has reminded individuals and businesses making year-end charitable contributions, of several important tax law provisions and general substantiation requirements that they should keep in mind. Rules for clothing and household items. To be deductible, clothing and household items donated to charity must be in good used condition or better. […]

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Payments from state to day care on behalf of public assistance recipients are subject to levy

Payments from state to day care on behalf of public assistance recipients are subject to levy

Chief Counsel Advice 201547005 In Chief Counsel Advice (CCA), IRS has determined that payments from a state to a day care facility on behalf of eligible public assistance recipients are subject to levy under Code Sec. 6331. IRS determined that the payments didn’t fall within Code Sec. 6334(a)(11)’s exclusion for public assistance payments because the […]

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Treasury Department publishes list of boycott countries

Treasury Department publishes list of boycott countries

Department of the Treasury: List of Countries Requiring Cooperation With an International Boycott (Oct. 22, 2015). The U.S. Treasury Department (Treasury) has published a current list of countries that may require participation in, or cooperation with, an international boycott for purposes of Code Sec. 999—the rule that denies certain tax benefits to a person that […]

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Affordable Care Act final regs finalize an array of issues covered in previous guidance

Affordable Care Act final regs finalize an array of issues covered in previous guidance

T.D. 9744, 11/13/2015, Reg. § 54.9815-1251, Reg. § 54.9815-2704, Reg. § 54.9815-2711 , Reg. § 54.9815-2712, Reg. § 54.9815-2714, Reg. § 54.9815-2719 , Reg. § 54.9815-2719A IRS, the Department of Labor (DOL), and the Department of Health and Human Services (HHS) — collectively, the Departments — have issued final regs on grandfathered health plans, preexisting […]

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IRS’s anti-inversion guidance makes inverting more difficult, but won’t solve problem

IRS’s anti-inversion guidance makes inverting more difficult, but won’t solve problem

Notice 2015-79, 2015-49 IRB U.S. Department of the Treasury, Fact Sheet: Additional Treasury Actions to Rein in Corporate Tax Inversions (11/19/2015). IRS has issued a second round of guidance, in the form of a Notice and accompanying fact sheet, as part of its continuing efforts to crack down on corporate inversions. The new Notice, similar […]

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Bits ’n Pieces – Mark Zuckerberg’s investment vehicle; do lower oil prices lead to lower oil tax rates; Cadillac tax repeal; tax free carbon a dumb idea; tax extenders – maybe

Bits ’n Pieces – Mark Zuckerberg’s investment vehicle; do lower oil prices lead to lower oil tax rates; Cadillac tax repeal; tax free carbon a dumb idea; tax extenders – maybe

* How Mark Zuckerberg’s altruism helps himself. By Jesse Eisinger – The New York Times. Mark Zuckerberg did not donate $45 billion to charity. You may have heard that, but that was wrong. Here’s what happened instead: Zuckerberg created an investment vehicle. Link to The New York Times, nyti.ms/1Q3wnKa * Do lower oil prices lead to […]

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CCA addresses civil tax issues relating to year taxpayer was subject of criminal conviction

CCA addresses civil tax issues relating to year taxpayer was subject of criminal conviction

Chief Counsel Advice 201545016 In Chief Counsel Advice (CCA), IRS has untangled several civil tax issues relating to a number of years for which a taxpayer filed invalid or otherwise faulty returns, was criminally charged with filing false claims against the U.S., and pled guilty to one such count. Among other things, the CCA concluded […]

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IRS upgrades FATCA Online Registration System

IRS upgrades FATCA Online Registration System

IR 2015-131 IRS has upgraded the Foreign Account Tax Compliance Act (FATCA) Online Registration System to, among other things, enable sponsoring entities to register their sponsored entities to obtain a global intermediary identification number (GIIN). Background. on FATCA. The Hiring Incentives to Restore Employment Act of 2010 (P.L. 111-147) added chapter 4 (Code Sec. 1471 […]

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New verification code will appear on some 2015 W-2 forms

New verification code will appear on some 2015 W-2 forms

IRS website: IRS Tests W-2 Verification Code for Filing Season 2016  IRS is putting a new verification code on Copies B & C of some payroll firms’ W-2 forms in order to test its capability to verify the authenticity of Form W-2 data. The test is one in a series of steps IRS is taking […]

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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