Federal

IRS Mea Culpa Could Prompt Easement Program Revamp

Kat Lucero

The IRS' admission of wrongdoing for covering up backdated evidence in a high-profile conservation easement case in Georgia could motivate the agency to revamp its oversight of the charitable tax deduction, which has been hotly contested in federal courts.

The Tax Angle: Extenders, Energy Credits And Budgets

Stephen K. Cooper
Editor-at-Large

From a look at the possibility of a December tax extender bill to Republican budget plans and GOP complaints of wasteful energy tax incentives, here's a peek into a reporter's notebook on a few of the week's developing tax stories.

Real-Time Partnership Audits Would Give IRS Trove Of Data

David van den Berg

The Internal Revenue Service is seeking feedback on a possible real-time audit program for partnerships, an initiative that if implemented could provide a wealth of valuable information that could be used to increase partnership compliance, practitioners told Law360.

Private Equity Owners Can Remedy Law Firms' Agency Issues

Nonlawyer, private-equity ownership of law firms can benefit shareholders and others vulnerable to governance issues such as disparate interests, and can in turn help resolve agency problems, says Michael Di Gennaro at The Law Practice Exchange.

Kentucky Tax Talk: Taking Up The Dormant Commerce Clause

Attorneys at Frost Brown examine whether the U.S. Supreme Court is likely to review Foresight Coal Sales v. Kent Chandler to consider whether a Kentucky utility rate law discriminates against interstate commerce, and how the decision may affect dormant commerce clause jurisprudence.

Prevailing Wage Rules Complicate Inflation Act Tax Incentives

Nicole Elliott and Timothy Taylor at Holland & Knight discuss the intersection between tax and labor newly created by the Inflation Reduction Act, and focus on aspects of recent U.S. Department of Labor and U.S. Department of the Treasury rules that may catch tax-incentive seekers off guard.

Payroll Tax Evasion Notice Suggests FinCEN's New Focus

The Financial Crimes Enforcement Network’s recent notice advising U.S. financial institutions to report payroll tax evasion and workers' compensation schemes in the construction industry suggests a growing interest in tax enforcement and IRS collaboration, as well as increased scrutiny in the construction sector, say Andrew Weiner and Jay Nanavati at Kostelanetz.

How Taxpayers Can Prep As Justices Weigh Repatriation Tax

The U.S. Supreme Court might strike down the 2017 federal tax overhaul's corporate repatriation tax in Moore v. U.S., so taxpayers should file protective tax refund claims before the case is decided and repatriate previously taxed earnings that could become entangled in dubious potential Section 965 refunds, say Jenny Austin and Gary Wilcox at Mayer Brown.

IRS Foreign Tax Credit Pause Is Welcome Course Correction

A recent IRS notice temporarily suspending application of 2022 foreign tax credit regulations provides wanted relief for the many U.S. multinational companies and other taxpayers that otherwise face the risk of significant double taxation in their international operations, say attorneys at Mayer Brown.

If Justices End Chevron Deference, Auer Could Be Next Target

If the U.S. Supreme Court decides next term to overrule its Chevron v. NRDC decision, it may open the door for a similar review of the Auer deference — the principle that a government agency can interpret, through application, ambiguous agency regulations, says Sohan Dasgupta at Taft Stettinius.

Tax Court Ruling Provides Helpful Profits Interest Guidance

A recent U.S. Tax Court decision holding that a partnership may exclude interests in a company that it indirectly received sheds light on related IRS guidance, including the proper valuation method for such interests, though the court's application of the method to the facts of this case appears flawed, say attorneys at Kramer Levin.

Mallory Ruling Doesn't Undermine NC Sales Tax Holding

Contrary to the conclusion reached in a recent Law360 guest article, the U.S. Supreme Court’s recent Mallory ruling shouldn't be read as implicitly repudiating the North Carolina Supreme Court’s sales tax ruling in Quad Graphics v. North Carolina Department of Revenue — the U.S. Supreme Court could have rejected Quad by directly overturning it, says Jonathan Entin at Case Western Reserve.

IRS Criminal Probe Spells Uncertainty For Malta Pension Plans

The IRS’ recent scrutiny of Malta pension plan arrangements — and its unusual issuance of criminal administrative summonses — confirms that it views many of these plans as illegal tax evasion schemes, and the road ahead will not be smooth and steady for anyone involved, say attorneys at Kostelanetz.

IRS Announcement Will Aid Cos. In Buyback Tax Planning

Recent IRS transitional guidance regarding current requirements for reporting and payment of the stock repurchase excise tax will help corporate taxpayers make decisions about records retention and establishing reserves for future tax payments, say Xenia Garofalo and Kyle Colonna at Eversheds Sutherland.

Mallory Opinion Implicitly Overturned NC Sales Tax Ruling

The U.S. Supreme Court recently declined to review Quad Graphics v. North Carolina Department of Revenue, but importantly kicked the legs from under Quad's outcome a week later, stating in its Mallory decision that the high court has the prerogative to overrule its own decisions, says Richard Pomp at the University of Connecticut.

How NIL Collectives Could Be Tax-Exempt After IRS Curveball

Since the Internal Revenue Service recently announced that numerous collectives creating paid name, image and likeness deals for collegiate student-athletes do not qualify for tax exemption, for-profit entities and alternative collective structures with incidental student-athlete benefits may be considered to fund NIL ventures, says David Kaufman at Thompson Coburn.