DOCSLIB.ORG

Fall 2018 • Vol

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text

Load more

Texas Tax Lawyer A Tax Journal Fall 2018 • Vol. 46 • No. 1 www.texastaxsection.org TABLE OF CONTENTS FROM OUR LEADER: • The Chair's Message Catherine C. Scheid, Law Offices of Catherine C. Scheid SPECIAL ATTENTION • Apply to the 2019-2020 Leadership Academy • Congratulations to Judge Elizabeth Ann Copeland! ARTICLES: • Business Consolidations: Special Considerations under the Texas Unemployment Compensation Act Scott C. Thompson, Haynes and Boone, LLP • Estate planning subsequent to the enactment of tax reform Audrey Young, RSM US LLP Rebecca Warren, RSM US LLP Carol Warley, RSM US LLP • Divorce and Tax Randall B. Wilhite, Fullenweider Wilhite, P.C. • Recent Developments in Federal Income Taxation: “Recent Developments are just like ancient history, except they happened less long ago” First Wednesday Tax Update, August 1, 2018 Bruce A. McGovern, Professor of Law and Director, Tax Clinic, South Texas College of Law Houston • Recent Developments in Federal Income Taxation: “Recent Developments are just like ancient history, except they happened less long ago” First Wednesday Tax Update, September 5, 2018 1 Bruce A. McGovern, Professor of Law and Director, Tax Clinic, South Texas College of Law Houston • Recent Developments in Federal Income Taxation: “Recent Developments are just like ancient history, except they happened less long ago” First Wednesday Tax Update, October 3, 2018 Bruce A. McGovern, Professor of Law and Director, Tax Clinic, South Texas College of Law Houston PRACTITIONER’S CORNER: • Tax Reform: Now What? Eric Solomon, Ernst & Young LLP • Unanticipated Pitfalls In Dealing with Texas Tax Laws Ira A. Lipstet, DuBois, Bryant & Campbell, LLP • South Dakota v. Wayfair: Do you have what you need? Jay Chadha, Norton Rose Fulbright US LLP COMMITTEE ON GOVERNMENT SUBMISSIONS: • Comments on Proposed Regulations Concerning the Deduction for Qualified Business Income under Section 199A of the Internal Revenue Code October 1, 2018 General Tax Committee Partnership and Real Estate Tax Committee Estate and Gift Tax Committee 2 SECTION INFORMATION: • Statement of Direction • 2018 – 2019 Calendar • Tax Section Council Roster • Tax Section Committee Chair and Vice Chair Roster The name and cover design of the Texas Tax Lawyer are the property of the State Bar of Texas Tax Section 3 Dear Fellow Tax Section Members, With the Astros having won the American League Division Series for 2018 and having put up a gallant fight for a 2018 World Series spot in the playoffs, and the Texans improving their chances for a playoff spot this fall, I am honored to deliver the following report for our fall edition of the Texas Tax Lawyer. I would also like to thank our Editor, Michelle Spiegel, for her continued commitment and hard work in delivering an outstanding Texas Tax Lawyer publication 3 times every year. Overview of Our Busy Summer The new officers met over the weekend of July 13, 14 and 15 2018 to begin planning for the upcoming year. This was preceded by our Council Retreat which was held in conjunction with the Annual Meeting on Thursday, June 21, 2018. In addition, the Tax Section held its first meeting of the Chairs, Vice Chairs and Council on Friday, August 24, 2018 at the Houston offices of Norton Rose Fulbright. As a result of these meetings, below are a few documents that have been approved: 1. The Calendar for the 2018-2019 Fiscal Year; 2. The List of Chairs and Vice Chairs for the committees; and 3. The Statement of Direction. The 2018 Annual Meeting was held in Houston, Texas and we give a special thanks to the Annual Meeting chair, John Strohmeyer, together with a planning committee including the CLE Committee chairs and a number of Tax Section leaders, including past Tax Section Chair and current Council member Alyson Outenreath, for having put together a great program. Continuing This Year The Tax Section is excited to announce that the successful webcast series “First Wednesday Tax Update” will continue to be offered the first Wednesday of each month with a focus on Recent Developments in Federal Income Taxation. The webcast will be presented by Bruce McGovern, Professor of Law and Director, Tax Clinic, South Texas College of Law Houston (and may occasionally include other guest speakers). We hope you will make plans to watch the webcast each month, but if you miss it, the webcast will be available on the Tax Section’s 24/7 online library within a couple of weeks. Watch your email for sign up information! Special thanks to Sara Giddings, Co-Chair of the Solo and Small Firm Committee, for coming up with this idea for providing convenient and relevant continuing legal education for our members, and to Bruce McGovern, Chair of the General Tax Committee for bringing Sara’s idea to life. The webcast is free to Tax Section Members. Leadership Academy The Leadership Academy, chaired by Rob Morris, is a program developed to guide the next generation of Texas tax lawyers in taking ownership of their careers and leading the Tax Section. The class meets four times over a year, which each session held in a different city and focusing - 1 - on a particular aspect of tax law. The deadline for applications for the 2019-2020 Leadership Academy class is January 11, 2019. Committee on Governmental Submissions The Committee on Governmental Submissions, co-chaired by Henry Talavera, Jeffry Blair, Ira Lipstet, and Jason Freeman, and the substantive committees of the Tax Section have been extremely busy this year providing comments to the Texas Comptroller of Public Accounts and the Internal Revenue Service. On October 1, 2018, comments were submitted to the Internal Revenue Service. The principal drafters were Professor Bruce McGovern, Chair of the General Tax Committee, Chris M. Goodrich, Vice Chair of the General Tax Committee, Nathan Smithson, Chair of the Partnership and Real Estate Tax Committee, Will Becker, Argyrios Saccopoulos and Vu Khoa, each a Member of the Partnership and Real Estate Tax Committee, Carol G. Warley, Laurel Stephenson, and Celeste C. Lawton, each a Co-Chair of the Estate and Gift Tax Committee, Corey Junk, Vice Chair of the Estate and Gift Tax Committee, Jeffry M. Blair, Chair of the Corporate Tax Committee, and Kelly Rubin, Vice Chair of the Corporate Tax Committee. The comments are a magnificent scholarly collaboration of the above committees, and addresses the government’s request for assistance with the Proposed Regulations providing guidance on the application of Section 199A of the Tax Cuts and Jobs Act of 2017. The comments suggest two operational rules: (1) how qualified property contributed to a partnership or S Corporation should be its pre-contribution unadjusted basis immediately after acquisition (“UBIA”); and (2) that certain basis adjustments under Sections 734 and 743 should be qualified property for purposes of determining UBIA. The comments also address how the proposed regulations excluding qualified business income (“QBI”) for 707(a) payments received for services may unfairly impact partners who would otherwise have QBI from a valid trade or business and suggests that guaranteed payments under Section 707(c) for the use of capital should not be excluded from QBI. The comments also: • request assistance from the Treasury for additional elaboration on the “performance of services in the field of health” and additional regulatory clarification in determining QBI under code section 864(c)(8) upon the sale of a partnership interest; • request clarification from the Treasury on the definition of a primary beneficiary for lifetime and testamentary trust planning and provide additional guidance on how the IRS will assess whether trusts have “substantially the same primary beneficiary or beneficiaries”; • request clarity regarding the 199A proposed regulations and the net investment income tax and distribution standards under a trust; • suggest that “if a trust or estate has a QBI net loss that the loss carryover be retained at the entity level”; and • suggest that charitable remainder trusts, charitable lead trusts and their beneficiaries should be eligible for the Section 199A deduction because the legislative history indicates it was enacted to provide a deduction for taxpayers other than a corporation based on QBI. Pro Bono Dockets The Pro Bono Committee, co-chaired by Juan Vasquez and Rachael Rubenstein, assisted taxpayers at the Lubbock Regular and Small Tax Case docket on September 17, 2018, the Dallas - 2 - Regular Case docket and San Antonio Regular and Small Tax Case docket on October 1, 2018, and the Houston Regular Tax Case docket October 15, 2018. Similar events are scheduled throughout the state of Texas for the remainder of the calendar year at various locations including Dallas, El Paso, Houston, Lubbock, and San Antonio. The Texas Tax Court Pro Bono Program was established by past Chair and now sitting Tax Court Judge Elizabeth A. Copeland. The Texas Pro Bono Program is now used as a model for other state bars. Meeting with the Texas Comptroller’s Office Our annual meeting with the Texas Comptroller of Public Accounts office is scheduled for Thursday, November 13, 2018 in Austin, Texas. Presentations from speakers from the Texas Comptroller’s Office, the Counsel on State Tax, the Texas Taxpayers and Research Association and the Multi State Tax Commission will be sprinkled throughout the day. The speakers will include Fred Nicely who is Legislative Counsel with the Counsel on State Tax, Dale Cramer, who used to be with the Comptroller’s Office and is now with Texas Taxpayers and Research Association, Chris Barber of the Multi State Tax Commission along with the Texas Comptroller Glenn Hegar and his staff. Portions of this program should soon be available on the Tax Section‘s 24/7 Free Online CLE Library. Many thanks to the Texas Comptroller of Public Accounts, Glenn Hegar, his staff and the State and Local Tax Committee, co-chaired by Sam Megally and Stephen Long for their hard work and efforts to plan this program and make it available to members of the Tax Section.
Recommended publications
  • Basic Income Tax, Second Edition © William P

    Basic Income Tax, Second Edition © William P

    Basic Income Tax, Second Edition © William P. Kratzke This work is licensed under a Creative Commons-ShareAlike 4.0 International License Original source: The Center for Computer-Assisted Legal Instruction (CALI) http://www.cali.org/books/basic-income-tax-second-edition Contents Basic Income Tax, Second Edition ................................................................................1 About the Author .....................................................................................................................1 Notices .......................................................................................................................................1 About CALI eLangdell Press.....................................................................................................2 Preface ......................................................................................................................................3 Chapter 1 The Government Raises Money: Introduction to Some Basic Concepts of Taxes and Taxing Income .........................................................................................4 1.1 Introduction to Some Basic Concepts..............................................................................4 The Ramsey Principle ......................................................................................................6 1.2 Taxing Income.....................................................................................................................8 Multiple-Choice ................................................................................................................9
  • The Future of American Tax Administration: Conceptual Alternatives and Political Realities

    The Future of American Tax Administration: Conceptual Alternatives and Political Realities

    Florida State University College of Law Scholarship Repository Scholarly Publications 2016 The Future of American Tax Administration: Conceptual Alternatives and Political Realities Steve R. Johnson Florida State University College of Law Follow this and additional works at: https://ir.law.fsu.edu/articles Part of the Administrative Law Commons, Taxation-Federal Commons, and the Tax Law Commons Recommended Citation Steve R. Johnson, The Future of American Tax Administration: Conceptual Alternatives and Political Realities, 7 COLUM. J. TAX L. 5 (2016), Available at: https://ir.law.fsu.edu/articles/237 This Article is brought to you for free and open access by Scholarship Repository. It has been accepted for inclusion in Scholarly Publications by an authorized administrator of Scholarship Repository. For more information, please contact [email protected]. ARTICLES THE FUTURE OF AMERICAN TAX ADMINISTRATION: CONCEPTUAL ALTERNATIVES AND POLITICAL REALITIES Steve R. Johnson* * University Professor, Florida State University College of Law, [email protected]. I thank the participants in the conference at which this paper originally was discussed: the March 2015 Tax Policy Symposium: Reforming the IRS sponsored by the University of Minnesota Law School Corporate Institute Forum on Taxation and Regulation. © 2016 Johnson. This is an open-access publication distributed under the terms of the Creative Commons Attribution License, https://creativecommons.org/licenses/by/4.0/, which permits the user to copy, distribute, and transmit the work provided that the original authors and source are credited. 6 COLUMBIA JOURNAL OF TAX LAW [Vol.7:5 I. INTERSECTING FORCES AND CURRENT CRISIS .............................................. 8 A. The Perfect Storm .................................................................................................. 8 1.
  • Not Just Whistling Dixie: the Case for Tax Whistleblowers in the States

    Not Just Whistling Dixie: the Case for Tax Whistleblowers in the States

    \\jciprod01\productn\V\VLR\59-3\VLR302.txt unknown Seq: 1 14-AUG-14 14:25 2014] NOT JUST WHISTLING DIXIE: THE CASE FOR TAX WHISTLEBLOWERS IN THE STATES DENNIS J. VENTRY, JR.* I. INTRODUCTION AX whistleblowing has been in the news lately. In September 2012, Tthe IRS wrote a check for $104 million to Bradley Birkenfeld, a for- mer banker with UBS, the Swiss banking giant. The payment, made under the federal government’s tax whistleblower program,1 represented Birkenfeld’s cut for providing information to the IRS that exposed how UBS actively concealed taxable income of U.S. clients for decades by hid- ing assets in secret offshore accounts.2 Birkenfeld’s assistance was “excep- tional in both its breadth and depth,” the IRS explained in making the award, and allowed the U.S. government to pursue “unprecedented ac- tions against UBS AG, with collateral impact on other enforcement activities.”3 “Collateral impact” hardly does justice to the effect of Birkenfeld’s whistleblowing. The “treasure trove of inside information” that Birkenfeld provided U.S. officials formed “the foundation for the UBS debacle and everything that followed.”4 Indeed, thanks to one of “the biggest whistleblowers of all time,”5 the U.S. government (take a deep breath) * Professor of Law, UC Davis School of Law. I thank Gregory Krakower, Darien Shanske, and Dean Zerbe for their helpful comments. I also benefited from suggestions and conversations at the Norman J. Shachoy Symposium, sponsored by the Villanova Law Review, particularly those from Jeremiah Coder and J. Richard Harvey. 1. For a discussion of the IRS whistleblower program, see infra notes 349–86 and accompanying text.
  • Preface (PDF Download)

    Preface (PDF Download)

    Preface Ensure student success with the Focus Casebook Series. THE FOCUS APPROACH In a law office, when a new associate attorney is being asked to assist a supervis- ing attorney with a legal matter in which the associate has no prior experience, it is common for the supervising attorney to provide the associate with a recently closed case file involving the same legal issues so that the associate can see and learn from the closed file to assist more effectively with the new matter. This exper- iential approach is at the heart of the Focus Casebook Series. Additional hands-on features, such as Real Life Applications, Applying the Concepts, and Federal Income Taxation in Practice provide more opportunities for critical analysis and application of concepts covered in the chapters. Professors can assign problem-solving questions as well as exercises on drafting documents and preparing appropriate filings. CONTENT SNAPSHOT This casebook focuses on clear communication of federal income tax fundamen- tals. On completion of the course, students will have not only the comprehensive substantive knowledge base needed for advanced study in the federal tax arena, but also a healthy degree of familiarity with various tax-related resources. The student will emerge with the ability to perform well in a clinical or practice setting. ■ Chapter 1 is introductory and includes basic background with respect to the constitutional authority to tax income and the roles of Congress, the Treasury Department, and the Internal Revenue Service. The chapter also covers standard tax legislation procedure and key sources of tax law and guidance. ■ Chapter 2 addresses the concept of realization and the current definition of “income.” It also introduces foundational tax terminology (e.g., basis, realiza- tion, recognition, etc.) and the fundamentals of the tax computation process.
  • Realization, Recognition, Reconciliation, Rationality and the Structure of the Federal Income Tax System

    Realization, Recognition, Reconciliation, Rationality and the Structure of the Federal Income Tax System

    Michigan Law Review Volume 88 Issue 7 1990 Realization, Recognition, Reconciliation, Rationality and the Structure of the Federal Income Tax System Patricia D. White University of Michigan Law School Follow this and additional works at: https://repository.law.umich.edu/mlr Part of the Taxation-Federal Commons, and the Tax Law Commons Recommended Citation Patricia D. White, Realization, Recognition, Reconciliation, Rationality and the Structure of the Federal Income Tax System, 88 MICH. L. REV. 2034 (1990). Available at: https://repository.law.umich.edu/mlr/vol88/iss7/3 This Article is brought to you for free and open access by the Michigan Law Review at University of Michigan Law School Scholarship Repository. It has been accepted for inclusion in Michigan Law Review by an authorized editor of University of Michigan Law School Scholarship Repository. For more information, please contact [email protected]. REALIZATION, RECOGNITION, RECONCILIATION, RATIONALITY AND THE STRUCTURE OF THE FEDERAL INCOME TAX SYSTEM Patricia D. White* TABLE OF CONTENTS I. THE BASIC STRUCTURE OF ANY TAX SYSTEM •••••••••• 2040 A. The Role of Realization. 2044 B. The Role of Reconciliation . 2053 II. THE DESCRIPTIVE POWER OF RECONCILIATION • • • • • • • • 2057 A. The Claim of Right Doctrine. 2057 B. The Tax Benefit Rule. 2060 C. Recapture Provisions . 2064 III. THE NORMATIVE ROLE OF RECONCILIATION .•••••••••• 2071 A. Simple Bo"owing . 2072 B. Purchase Money Mortgages, Footnote 37, and the Issue in Tufts ..................................... 2075 1. The Implications of Coherence . 2075 2. A Significant Cost of Coherence. 2088 IV. POSTSCRIPT TO PARTS II AND III: WHEN To RECONCILE • • • • • . • • • • • • • • • • • • • • • • • . • • • • • • • • • • • • • • • • • • • • 2093 CONCLUSION • • • • • • • • • • • • • • • • . • • • • • . • • • • • . • • • • • • • . • • • • • • • • • • 2095 Federal income tax reform is much talked about these days.
  • Instructions for Form 6251 7

    Instructions for Form 6251 7

    Revised Proof Ok to Print Rtext sent (date) Requested (init. & date) (init. & date) Page 1 of 8 of Instructions for Form 6251 7 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Department of the Treasury Internal Revenue Service Instructions for Form 6251 Alternative Minimum Tax—Individuals (Section references are to the Internal Revenue Code unless otherwise noted.) General Instructions cases, line 20). The forms used to figure Credit For Prior Year these credits have information on the tentative minimum tax limit. Minimum Tax Paperwork Reduction Act Get Form 8801, Credit For Prior Year Notice Additional Information Minimum Tax—Individuals and We ask for the information on this form Fiduciaries, if you paid AMT for 1991, or For more details, get Pub. 909, if you had a minimum tax credit to carry out the Internal Revenue laws of Alternative Minimum Tax for Individuals. the United States. You are required to carryforward on line 26 of your 1991 give us the information. We need it to Form 8801. If you pay AMT for 1992, ensure that you are complying with Recordkeeping you may be able to take a credit on your these laws and to allow us to figure and For AMT purposes, certain items of 1993 Form 8801. collect the right amount of tax. income, deductions, etc., receive The time needed to complete and file different tax treatment than for regular Earned Income Credit this form will vary depending on tax purposes. Therefore, for the AMT If you have an earned income credit, you individual circumstances.
  • Executive Pay Clawbacks and Their Taxation

    Executive Pay Clawbacks and Their Taxation

    Boston University School of Law Scholarly Commons at Boston University School of Law Faculty Scholarship 2021 Executive Pay Clawbacks and Their Taxation David Walker Boston Univeristy School of Law Follow this and additional works at: https://scholarship.law.bu.edu/faculty_scholarship Part of the Business Organizations Law Commons, and the Tax Law Commons Recommended Citation David Walker, Executive Pay Clawbacks and Their Taxation, No. 21-01 Boston University School of Law, Law and Economics Research Paper (2021). Available at: https://scholarship.law.bu.edu/faculty_scholarship/1051 This Article is brought to you for free and open access by Scholarly Commons at Boston University School of Law. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of Scholarly Commons at Boston University School of Law. For more information, please contact [email protected]. EXECUTIVE PAY CLAWBACKS AND THEIR TAXATION Boston University School of Law Law & Economics Series Paper No. 21-01 2021* David I. Walker Boston University School of Law *Forthcoming, 24 Fla. Tax Rev. (2021) Electronic copy available at: https://ssrn.com/abstract=3773046 EXECUTIVE PAY CLAWBACKS AND THEIR TAXATION FORTHCOMING, 24 FLA. TAX REV. (2021) DAVID I. WALKER* ABSTRACT Executive pay clawback provisions require executives to repay previously received compensation under certain circumstances, such as a downward adjustment to the financial results upon which their incentive pay was predicated. The use of these provisions is on the rise, and the SEC
  • Farm Income Tax Management and Reporting

    Farm Income Tax Management and Reporting

    November 1991 A.E. Ext. 91-29 FARM INCOME TAX MANAGEMENT AND REPORTING Reference Manual [lONE WAy:1] IRS George L. Casler Stuart F. Smith • Department of Agricultural Economics New York State College of Agriculture and life Sciences A Statutory College of the State University Cornell University, Ithaca, New York 14853-7801 It is the policy of Cornell University actively to support equality of educational and employment opportunity. No person shall be denied admission to any educational program or activity or be denied employment on the basis of any legally prohibited dis­ crimination involving, but not limited to, such factors as race, color, creed, religion, national or ethnic origin, sex, age or .. handicap. The University is committed to the maintenance of •. affirmative action programs which will assure the continuation of such equality of opportunity. 1991 TAX FORMS NEEDED BY NEW YORK FARMERS Federal Forms 1040 - U.S. Individual Income Tax Return (R) Schedule A & B - Itemized Deductions and Dividend and Interest Income (R) Schedule D - Capital Gains and Losses (and Reconciliation of Forms 1099-B) (R) Schedule E - Supplemental Income Schedule Schedule EIC - Earned Income Credit (New) Schedule F - Farm Income and Expenses. Line added for car and truck expo Schedule R - Credit for Elderly or the Disabled Schedule SE - Computation of Social Security Self-Employment Tax (R) 1040EZ - Income Tax Return for single filers with no dependents, income under $50,000, interest under $400, other limitations 1040A - Nonitemizers, under $50,000 taxable income, other limitations (R) 1040X - Amended U.S. Individual Income Tax Return 943 - Employer's Annual Tax Return for Agricultural Employees 1099 - Information returns to be filed by person who makes certain payments 1096 - Annual Summary and Transmittal of U.S.
  • 2003 Chapter 2

    2003 Chapter 2

    2003 Workbook Chapter 2: Small Business Issues 2 Issue 1 — Form 4797 ....................................................... 47 Issue 5 — Change of Accounting Method: IRC §481(a) Adjustments................................................ 98 Issue 2 — Construction Industry Issues ........................ 64 Issue 6 — New Business Credits................................... 110 Issue 3 — Purchase of a Business ................................... 80 Endnotes ......................................................................... 115 Issue 4 — Gain/Loss on Repossessed Property ............. 86 Corrections were made to this workbook through January of 2004. No subsequent modifications were made. ISSUE 1 — FORM 4797 INTRODUCTION When taxpayers sell assets used in their trade or business, they record the sale on Form 4797, Sales of Business Property. The form is designed to sort assets by type and to allow the recapture of depreciation and IRC §179 deduc- tions. Ultimately, the sales are sorted into capital gains and losses, and ordinary income. The capital gains and losses transfer to Schedule D, and the ordinary income from depreciation recapture is reported on line 14 of Form 1040. There are three advantages to reporting sales on Form 4797: 1. Normally, the gains avoid being taxed for self-employment tax. 2. A portion of the gain may be eligible for capital gain treatment and taxed at a lower rate. 3. Losses from the sale of the business assets are fully deductible as ordinary losses. Form 4797 is used to report the sale or exchange of: 1. Depreciable or amortizable property; 2. Oil, gas, geothermal, or other mineral property; and 3. IRC §126 property. Other transactions reported on Form 4797 include: 1. Involuntary conversion (from other than a casualty or theft) of property used in a trade or business, 2.
  • The Fabricated Unwind Doctrine: the True Meaning of Penn V. Robertson John Prebble

    The Fabricated Unwind Doctrine: the True Meaning of Penn V. Robertson John Prebble

    Hastings Business Law Journal Volume 7 Article 9 Number 1 Winter 2011 Winter 2011 The fabricated Unwind Doctrine: the True Meaning of Penn v. Robertson John Prebble Chye-Ching Huang Follow this and additional works at: https://repository.uchastings.edu/ hastings_business_law_journal Part of the Business Organizations Law Commons Recommended Citation John Prebble and Chye-Ching Huang, The fabricated Unwind Doctrine: the True Meaning of Penn v. Robertson, 7 Hastings Bus. L.J. 117 (2011). Available at: https://repository.uchastings.edu/hastings_business_law_journal/vol7/iss1/9 This Article is brought to you for free and open access by the Law Journals at UC Hastings Scholarship Repository. It has been accepted for inclusion in Hastings Business Law Journal by an authorized editor of UC Hastings Scholarship Repository. For more information, please contact [email protected]. THE FABRICATED UNWIND DOCTRINE: THE TRUE MEANING OF PENN V ROBERTSONt John Prebble*and Chye-Ching Huang** I. INTRODUCTION AND OVERVIEW Taxpayers routinely rely on the unwind doctrine found in Internal Revenue Service Revenue Ruling 80-58' when they discover that their transactions have unwanted tax consequences. Nowadays, "unwinding" has become a "common if not ubiquitous feature of tax practice."2 This article finds that the unwind doctrine has no firm basis in case law. Instead, the unwind doctrine is an Internal Revenue Service (IRS) fabrication based on the IRS' misinterpretation of the case Penn v. Robertson. Also referred to as the "rescission doctrine,"4 a tax "do-over,"5 or a "tax mulligan,"' the effect of the unwind doctrine is that if you change your mind about a transaction, you can avoid its income tax consequences by returning to the economic status quo ante, so long as you do so by the end t The authors gratefully acknowledge colleagues and correspondents who commented generously on earlier drafts and who responded to questions.
  • 2011–2012 Federal Income Tax Law Course Deskbook

    2011–2012 Federal Income Tax Law Course Deskbook

    2011-2012 FEDERAL INCOME TAX LAW COURSE DESKBOOK November 2011 - January 2012 Deskbook Table of Contents Page Administrative Matters Faculty Biographies ............................................................................................................... ii Outlines and Materials Communicating with the IRS ............................................................................................. A-1 Professional Responsibility ................................................................................................. B-1 Casualty Tax Issues .............................................................................................................C-1 Deployment Tax Issues ....................................................................................................... D-1 Adjustments to Income ........................................................................................................ E-1 Tax Aspects of Individual Retirement Arrangements (IRAs) ............................................. F-1 Tax Aspects of Stocks & Mutual Funds ............................................................................. G-1 Tax Aspects of Real Property ............................................................................................. H-1 Tax Credits ........................................................................................................................... I-1 Sale of Rental Property ........................................................................................................
  • N We I NATIONALCENTER 3238 P STREET, 1,1\(\ VV/È,SHI~JGTON

    N We I NATIONALCENTER 3238 P STREET, 1,1\(\ VV/È,SHI~JGTON

    WHISTLEBLOWERS N we I NATIONALCENTER 3238 P STREET, 1,1\(\ VV/è,SHI~JGTON. DC 20007 202-3J¿-1 S".L i. \i/H i June 5, 2014 The Honorable Jacob J. Lew Secretary Department of Treasury 1500 Pennsylvania Ave., NW Washington, D.C. 20220 Dear Mr. Secretary: On behalf of the National Whistleblower Center (NWC), I am submitting commentary regarding the Department of Treasury's proposed regulations regarding the IRS whistleblower program: -liThe Legality of the IRS' Proposed Whistleblower Rule: Flunking the Loving Test. ii The NWC's comments are focused on Treasury's improper narrow interpretation of IIcollected proceeds.1I Treasury's proposed interpretation of IIcollected proceedsll harms the efforts of the Treasury Department to combat offshore tax evasion in particular and in general undermines Congressional policy of awarding whistle blowers. The NWC analysis ofthe Treasury proposed regulations is done in light of the recent court decision in Loving v. IRS, 742 F.3d 1013 (D.C. Cir. Feb. 11, 2014) - where the Court held that the IRS exceeded its statutory authority in regulations of tax-return preparers. Similar to the Court in Loving, the NWC finds that a review of the IRS whistleblower statute's text, history, structure and context shows that Treasury/IRS has exceeded its statutory authority in its narrow interpretation of llcollected proceeds.1I The Treasury's proposed regulations for the IRS whistleblower program were issued before the Loving decision. The Department of Justice recently announced it would not appeal the Loving decision. The NWC views it as vital that the Treasury revisit the proposed IRS whistleblower regulations with a full consideration ofthe Appellate Court's decision.