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1309, 2018

Syndicated Conservation Easements Included in Next Wave of LB&I Compliance Campaigns

By |September 13th, 2018|Resource Library|0 Comments

On September 10, the Large Business and International Division (LB&I) of the IRS announced five additional compliance campaigns. Initially announced in January 2017, LB&I’s Compliance Campaigns are designed as an issue-based approach to address areas of tax that the Service has identified as having a high risk of compliance issues. Among the items listed in this newest rounds of campaigns, taxpayers will find Syndicated Conservation Easements. All in all, the Service has currently identified 45 areas of enforcement.

A conservation easement is a donation to certain tax-exempt and government organizations of a right in real property, made by a taxpayer for a conservation purpose. When established correctly and for proper purposes, a conservation easement allows a taxpayer to take a deduction for donating an easement on real property to a qualified organization, while continuing to own and enjoy the property.

However, not all conservation easements are created equal. The IRS has been […]

608, 2018

The Wayfair Ruling and What it Means for Small Business

By |August 6th, 2018|publishedarticles|0 Comments

I know it’s August and probably the last thing on your mind is the Supreme Court’s recent Wayfair decision on out-of-state sellers.

However, given the long-term implications of the case and its anticipated impact on your clients and e-commerce in general, I thought you’d be interested in this recent Accounting Today piece. In the article, I discuss the ruling’s potential effect on small and medium businesses:

  • Although there was nothing about protecting small business in the actual holding of the Wayfair decision, it did have a lot of vague ideas on the subject, observed Dean Zerbe, alliantgroup’s national managing director and former senior counsel with the Senate Finance Committee. “Good luck with that! I don’t think states will show a restraining hand,” he said.
  • “Right after they have sales tax nexus, they’ll try to extend it to business activity tax,” Zerbe predicted. “You’re here for sales tax — […]
208, 2018

Tax Notes: U.S. Transition Tax Regs Provide Clarity, Limited Relief

By |August 2nd, 2018|In the news|0 Comments

Robert Russell, Former Counsel to the Joint Committee on Taxation and U.S. Department of Treasury; alliantgroup Director of International Tax Controversy, Planning and Policy, quoted in Tax Notes.
August 2, 2018
Published in Tax Notes

208, 2018

U.S. Transition Tax Regs Provide Clarity, Limited Relief

By |August 2nd, 2018|publishedarticles|0 Comments

August 2, 2018
By Andre Velarde
Published in Tax Notes

Lengthy transition tax regs may offer practitioners some reassurance in fleshing out more details, but they don’t venture much outside the original scope of previous guidance.

“With the release of the regs, not absolute certainty as to the transition tax liability, but pretty close,” Jose Murillo of EY said.

The highly anticipated proposed regs (REG-104226-18), released August 1, are one of the first pieces of key guidance from the Tax Cuts and Jobs Act (P.L. 115-97) to be released.

Practitioners had been anxiously awaiting more guidance on the transition tax because three previous notices, while detailed, left many questions unanswered. The 249-page reg package is divided into nine sections, including rules on adjustments to earnings and profits and basis, determining section 965(c) deductions, disregarding some transactions, foreign tax credits, elections and payments, and affiliated groups.

“Despite their length, the proposed regulations do not break […]

907, 2018

LB&I Continues to Expand its Campaign List

By |July 9th, 2018|Resource Library|0 Comments

On July 2, 2018, the Large Business and International (LB&I) Division of the IRS released five additional Compliance Campaigns. Initially announced in January 2017, LB&I’s Compliance Campaigns are designed as an issue-based approach to address areas of tax that the Service has identified as having a high risk of compliance issues. This determination is based on extensive data analyses as well as suggestions from IRS employees and other members of the tax community. Additionally, the Service has notified taxpayers and practitioners that they will be reviewing all campaigns in light of changes imposed by tax reform.

Of the five campaigns announced on July 2, the virtual currency campaign is perhaps the most notable. The remaining campaigns include Restoration of Sequestered Alternative Minimum Tax (AMT), S Corporation Distributions, repatriation via foreign triangular reorganizations, and application of the section 965 transition tax.

In line with the recent speculation of practitioners, LB&I has formally initiated […]

907, 2018

Supreme Court Issues Monumental Sales Tax Decision Involving Online Retailers

By |July 9th, 2018|Resource Library|0 Comments

On June 21, the US Supreme Court issued its decision in South Dakota v. Wayfair, clearing the path for states to impose sales tax on online and remote retailers. Previously it had long been established that a state could not impose a sales tax on a remote seller if they did not have a physical presence in the state. This meant that online retailers and other remote sellers were not required to collect and remit sales taxes in states in which they did not have a physical presence. However, in ruling in favor of South Dakota the Court has overturned this long established precedent.

Established in Quill Corp. v. North Dakota, the physical presence standard posited that in order for a taxpayer to be subject to a state’s sales tax, the taxpayer must have a physical presence in that state. This is an extension of the physical presence standard established in […]

2706, 2018

Tax Notes: Unclear if the IRS Can Save the Client Business Meal

By |June 27th, 2018|In the news|0 Comments

Kathy Petronchak, former IRS Small Business/Self-Employed Division commissioner and alliantgroup Director of IRS Practices and Procedure, interviewed by Tax Notes.
June 27, 2018
Published in Tax Notes

2706, 2018

Unclear if the IRS Can Save the Client Business Meal

By |June 27th, 2018|publishedarticles|0 Comments

June 27, 2018
By Stephanie Cumings
Published in Tax Notes

Tax observers are torn on whether the IRS has the power to restore the deduction for client business meals that Congress seems to have unintentionally axed in the 2017 tax law.

While some practitioners contend that the IRS can salvage the deduction, one professor argues that Congress will have to amend the law if it really intended to keep client business meals deductible. The answer hinges on whether client business meals constitute “entertainment.” Under the prior law, entertainment expenses were 50 percent deductible if they met certain qualifications, but the Tax Cuts and Jobs Act (P.L. 115-97) eliminated the deduction altogether.

“Up until this change in the law, it didn’t really matter whether or not food and beverage was considered entertainment because it was 50 percent deductible either way,” Michael L. Hadley of Davis & Harman LLP told Tax Analysts.

The TCJA conference report […]

2206, 2018

Tax Court Follows Avrahami Analysis in Reserve Mechanical Decision

By |June 22nd, 2018|Resource Library|0 Comments

Last August, the US Tax Court issued its decision in Avrahami v. Comm’r of Internal Revenue, No. 17594-13, (T.C. Aug. 21, 2017), the earliest Tax Court opinion involving a micro-captive. A second case has joined its ranks. On June 18, the Tax Court released its ruling in Reserve Mechanical v. Comm’r of Internal Revenue, No. 14545-16, (T.C. June 18, 2018). While it involved a small insurance company and whether it qualified under Internal Revenue Code section 501(c)(15), Reserve Mechanical provides additional information about the Tax Court’s views on captives and what the court considers insurance in this context.

Captive insurance owners and managers should note that even though the taxpayer’s facts in Reserve were different than those facts presented in Avrahami, the Court’s underlying analysis of the issues remained similar between the two cases. For example, both the Avrahami and Reserve decisions focused primarily on two of the four criteria required […]

406, 2018

Early 2018 is LB&I’s Campaign Season

By |June 4th, 2018|Resource Library|0 Comments

On May 21, 2018, the Large Business and International (LB&I) Division of the IRS released six additional Compliance Campaigns. Initially rolled out in January 2017, LB&I’s Compliance Campaigns are designed as an issue-based approach to address areas of tax that the Service has identified as having a high risk of compliance issues. This determination is based on extensive data analysis as well as suggestion from IRS employees and other members of the tax community.

Of the six campaigns announced on May 21, three revolve around nonresident aliens (NRA’s). These three campaigns, Nonresident Alien Tax Treaty Exemptions, Nonresident Alien – Schedule A and Other Deductions, and NRA Tax Credits, will attempt to increase compliance through both outreach, education and traditional examinations. The Nonresident Alien Tax Treaty Exemptions campaign is aimed at increasing compliance related to requests for exemptions under U.S. tax treaties. The Nonresident Alien – Schedule A and Other Deductions […]

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