In February of 2020, the United States Tax Court issued a Memo, Railroad Holdings, LLC T.C. Memo. 2020-22 (U.S.T.C. Feb. 5, 2020), and an Order, Rock Creek Holdings, LLC, Tax Court Order, 2/10/2020. Both the Memo and the Order pertain to the conservation easement in dispute in the cases. In the first case, the Court [...]
When it comes to the charitable donation of art, the Internal Revenue Service (IRS) has increasingly adopted a predictable strategy, as outlined in part two of this series. Similar to cases involving conservation easements, the IRS can even take the position that donated art is worth $0. While this is the IRS’s most extreme position [...]
As discussed in part one of this series on art donations, a taxpayer who wishes to receive a tax deduction for their charitable donation of a work of art should take several steps in anticipation of the Internal Revenue Service’s (IRS’s) refusal to allow the deduction. In recent years, especially, the IRS has undertaken a [...]
On April 2, 2024, Senate File (SF) 4742, as a companion to House File (HF) 4934, was subject to a hearing before the Minnesota House of Representatives. HF 4934, like SF 4725, would amend Minnesota Statutes 2022, sections 270C.07, subdivision 1 and 270.33, to ensure that the Commissioner of Revenue (Commissioner) is bound by Minnesota [...]
On Thursday, March 21, 2024, the Minnesota Senate Tax Committee had a hearing regarding Chair Ann Rest’s bill, Senate File (SF) 4725, which amends Minnesota Statutes 2022, sections 270C.07, subdivision 1 and 270C.33 to ensure that the Commissioner of Revenue is bound by Minnesota Tax Court decisions in situations where the Commissioner opts not to [...]
Despite the relative rarity of an individual taxpayer’s file being brought to United States Tax Court or even audited, many taxpayers nevertheless fear the Internal Revenue Service (IRS) coming after them. This is not without good reason. Responding to an IRS audit alone can be time consuming and involves obtaining and compiling numerous documents. That [...]
On April 20, 2017, the United States Tax Court (Court) held in favor the petitioners, John C. Trimmer and Susan Trimmer (together, the Trimmers) against the Commissioner of Internal Revenue, regarding the Internal Revenue Service’s (IRS’s) authority to consider a hardship waiver and the notion that the IRS’s authority on the hardship waiver is not [...]
The Internal Revenue Service (IRS), like any self-respecting bureaucracy, sometimes makes mistakes. When those mistakes occurs, a taxpayer can make a “qualified offer,” which might lead to a settlement and obviate the need for a drawn out court battle. If the case nevertheless goes to Tax Court, and the taxpayer prevails in their case, they [...]
It is not uncommon for small businesses to rely on friends and family for loans to assist the business in meeting operating expenses. This is even more true given the on-going pandemic. Small businesses are scrambling to make sure they can meeting their operating expenses. Unfortunately, many of those small business owners are so focused [...]
For many taxpayers with multiple active business interests, the material participation test can be a significant tax trap. If the elements of that test are not met, the impact could be that the taxpayer is limited in how the income/loss from that business is recognized on their personal tax return. A recent decision in the [...]