Tax News & Views ERC in the Family

ERC

IRS Extends Employee Retention Credit Appeal Window – Benjamin Valdez, Tax Notes ($):

The IRS has provided taxpayers two years to appeal an employee retention credit disallowance but is requiring them to include extensive documentation in their appeal.

The agency explained on a webpage published September 19 that taxpayers will have two years to appeal Letters 105-C, “Disallowance of the Employee Retention Credit,” up from the typical 30-day deadline under IRS administrative rules. Taxpayers also have two years to file a suit, but requesting an appeal won’t extend that period.

IRS Extends Window to Appeal Pandemic-Era Tax Credit Denial – Erin Slowey, Bloomberg Tax:

Businesses recently denied the troubled pandemic-era employee retention tax credit but disagree with the decision now have more time to appeal.

Taxpayers can request an appeal at any time within two years of the disallowance letter or Letter 105-C, according to a new update on the IRS site Thursday. Typically taxpayers have 30 days to dispute the denial before the case will be processed.

Election

How Trump Could Upend Taxation in America – Andrew Duehren, New York Times:

At the start of the summer, when former President Donald J. Trump visited Republicans on Capitol Hill, he hinted at a vision for a vastly different tax system than what the United States has employed for decades.

Rather than taxing Americans on the money they earn at their jobs and on their investments, Mr. Trump instead suggested imposing a broad tax on the goods that Americans buy from abroad. In his view, such tariffs could replace income taxes as the main source of federal revenue.

The Trump tax flip-flop that could help Republicans win the House – Ally Mutnick and Sarah Ferris, Politico:

Donald Trump’s surprising reversal on a contentious piece of his own signature tax law won’t help him win any swing states — but some Republicans believe it could help them hold the House.

After personal lobbying from at least three endangered GOP lawmakers, Trump is now vowing to restore a key tax break, known as the state and local tax deduction, or SALT, that remains a top voting issue with millions of middle- and upper-class Americans in states with onerous local taxes and a high cost of living.

Corporate Minimum Tax

Why the Corporate Minimum Tax Will Likely Survive a GOP Clawback – Chris Cioffi, Bloomberg Tax ($):

Getting rid of the corporate alternative minimum tax—hated by companies and many Republicans—will likely be harder than critics think.

The 15% tax on massive US companies’ financial statement income was a major tax law shift and victory for Democrats in their 2022 tax-and-climate law. The GOP doesn’t like it, but extending their own signature 2017 tax law is a priority and they’ll need all the revenue they can get for offsets.

Carbon Capture

Environmentalists Fear Subsidies for Carbon Capture Won’t Be Checked – Minho Kim, New York Times:

Lucrative new tax subsidies for companies that catch the planet-warming gas carbon dioxide and store it deep underground were one of the few aspects of President Biden’s 2022 climate legislation that the oil industry embraced.

The potential tax benefits spurred the industry, one of the largest contributors to the current climate crisis, to invest billions of dollars in the process, called carbon capture and sequestration.

Now some Democratic lawmakers, tax watchdogs and climate activists are raising concerns that the Internal Revenue Service, tasked with verifying fossil-fuel industry claims on stored carbon, lacks adequate safeguards to ensure that no companies are taking more taxpayer dollars than they qualify for. And they are equally frustrated that the I.R.S. and the Environmental Protection Agency rely on the companies’ own reported data.

Conservation Easements

IRS Hit with Twin $70 Million Easement Tax Deduction Lawsuits – John Woolley, Bloomberg Tax ($). “Two partnerships in Georgia and Mississippi each sued the IRS in unrelated suits, saying the agency should allow their separate $70 million noncash charitable contribution tax deductions because they collectively donated conservation easements over more than 679 acres of land.”

TIGTA

IRS Not Meeting Disclosure Requirements for Joint Returns – Jack McLoone, Law360 ($):

The Internal Revenue Service did not uniformly follow joint return disclosure requirements on collection information requests, burdening taxpayers with additional delays resolving their tax matters and possibly violating their privacy rights, the Treasury Inspector General for Tax Administration said Friday.

TIGTA, the IRS' watchdog, determined that disclosure requirements were not followed in 28% of the 50 cases it reviewed that were handled by the IRS Wage and Investment Division's accounts management function and in 12% of 50 field assistance cases, it said in a report dated Tuesday.

In the Courts

Family Owes $81M Taxes On 'Son-Of-Boss' Scheme, DOJ Says – Kat Lucero, Law360 ($). “Former shareholders of a family-owned holding company owe the IRS nearly $81 million for participating in what is known as a Son-of-Boss arrangement, which generated fake capital losses in the 2022 sale of company stock, the U.S. Department of Justice told a New York federal court.”

Tribe's Stateless Status Undoes $1.9M Construction Suit – Chris Villani, Law360 ($):

A Massachusetts federal judge on Thursday tossed a New York construction company's $1.9 million lawsuit against the Mashpee Wampanoag Tribe, finding the tribe's stateless position leaves the court with no jurisdiction to decide the case.

In a brief order, U.S. District Judge William G. Young ruled that even the tribe's separate entity, Mashpee Wampanoag Village LP, falls within parameters that would not allow the case brought by Calamar Construction Services to play out in federal court.

Sportsmen’s Club Defends Natural Gas Leasing Income – Erin McManus, Tax Notes ($). “A hunting and fishing club says the IRS isn’t giving it a sporting chance to defend its exempt status as a social club after it began to receive natural gas royalties.”

What day is it?

Its National Family Day. “Families come in many forms and sizes and under different circumstances, but what they all share is unconditional love and support ….”

Tax News & Views ERC in the Family

We're Here to Help

Trina Pinneau