If there is any doubt as to whether a taxpayer is liable for income taxes, there is a good chance that the IRS will agree to settle for less. The IRS Office of Appeals is tasked with doing just that. IRS appeals settlements are usually all or nothing. If the taxpayer does not accept the… Continue reading Settle Taxes & Keep Right to Dispute Open
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What happens if the IRS enters into a settlement agreement for your tax liability and then, later, it takes a position that is inconsistent with the agreement? For example, can the IRS agree that an expense is deductible by your business only to say that the same is expense is taxable income to you as… Continue reading How to Contest an IRS Settlement Agreement
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What if a CPA talks to you and tells you about a tax law? You have received tax advice, right? What if a CPA sends you a letter or email saying the same thing he would have said to you in person, had he spoke to you in person? Probably still tax advice, no? What… Continue reading What Counts as Tax Advice?
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Our tax laws create categories–income/exclusion, deduction, and credit. Taxpayers are presented with structured forms that set out these categories. The IRS expects taxpayers to fill out the forms by correctly identifying what items go in each category. But it is not always clear what items go in each category. Taxpayers may engage in tax planning… Continue reading Tax Reporting for Returns & Allowances
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Dad filed his taxes but didn’t pay. Several years pass by, say five years. Dad dies. The family eventually files for probate several years later. Say 10 years has passed since the taxes were first due? Has the time limit for the IRS to collect the unpaid taxes lapsed? How does the filing of the… Continue reading When Can the IRS Collect Tax Debts from a Dead Person?
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There are several types of tax disputes that are frequently litigated. Gambling losses are an example. Taxpayers who gamble often incur significant losses. If the taxpayer is found to be a professional gambler, these losses can be counted for income tax purposes and used to offset the taxpayer’s other income. These tax losses can reduce… Continue reading How to Substantiate Gambling Tax Losses
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There are times when tax deadlines are strict. They cannot be changed. The time period for filing a refund claim is an example. Taxpayers generally have the later of three years from the filing of a return or two years from the payment of the tax to file a refund claim. But what if the… Continue reading Correcting Tax Overpayments After the Refund Period
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As innocuous as it sounds, the Form 3115 is a tax form like no other. A Form 3115 that is inadvertently omitted from a tax return filing can result in sizable differences in tax and trigger significant tax penalties and interest. Given the amounts that are often reported on the Form 3115, errors could cost… Continue reading IRS Expands Sec. 9100 Relief for Late Forms 3115
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If you move out of a house and rent it to a friend for less than fair market value rent, can you then take a tax loss on the subsequent sale of the house? If the home is not converted to a rental property, the loss is disallowed as a personal tax loss. If the… Continue reading Converting Home to Rental to Get Tax Loss Deduction
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