TAXLITIGATOR – Tax Controversy (Civil & Criminal) Report

We are pleased to announce that Michel R. Stein along with Maria Dolan (Deputy Director Pass-Through Entities, LB&I, IRS), Richard Tierney (Director of Exam, SB/SE, IRS) and Jonathan Strouse (Partner, Harrison LLP, Chicago, IL) will be speaking on IRS Examinations for High Wealth Individuals and Their Partnerships – What to Expect in Tax Enforcement After the Inflation Reduction Act Funding at the upcoming St. Louis Summer Tax Summit being held at the Missouri Athletic Club on Tuesday, August 27, 2024, 1:30 p.m. – 2:30 p.m. (CT).

In connection with the additional appropriations in the Inflation Reduction Act, the IRS has committed to shift more resources to high-income earners and large partnerships. This panel will explain the IRS’s announced enforcement priorities for high-income earners and large partnerships, the expected timeline for additional enforcement, and strategies for representing clients in IRS examinations of high-income taxpayers.

• Learn about the Global High Wealth Group audit program
• Better Understand the Enforcement Priorities of LBI and SB/SE 
• Decipher the BBA partnership examination process
• Learn about the IRM procedures application to case selection and examination  

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For more information, please contact Michel R. Stein at stein@taxlitigator.com

Curious about the latest developments in crypto taxation?

We are pleased to announce that Michel R. Stein and Philipp Behrendt have co-authored an article, published in the Summer 2024 issue of the Journal of Tax Practice & Procedure, titled “Decoding Crypto Taxation: Essential Updates for Professionals.” This article provides a comprehensive update on IRS enforcement in the realm of digital assets and an overview of the key crypto transactions you need to know for 2023/2024. Dive in to stay ahead in the ever-evolving world of crypto tax enforcement!

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For more information, please contact Michel R. Stein at stein@taxlitigator.com

For more information, please contact Philipp Behrendt at behrendt@taxlitigator.com

Want to know what keeps many tax controversy practitioners up at night? Representing taxpayers faced with parallel tax investigations certainly makes the list! 

We are pleased to announce that Sandra R. Brown and Hunter Keaster wrote an article published in the Summer, 2024 issue of the the Journal of Tax Practice & Procedure, titled “Criminal, Civil, or Both: Navigating Parallel Investigations with the IRS” which details the complexity of parallel tax investigations and provides tips for tax practitioners to better wield the appropriate shield or sword in defending the rights of clients in such cases.

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For more information, please contact Sandra R. Brown at brown@taxlitigator.com

For more information, please contact Hunter Keaster at hk@taxlitigator.com

We are pleased to announce that Michel R. Stein, Evan Davis and Philipp Behrendt will be speaking at the upcoming CalCPA Cryptocurrency Compliance webinar, Tuesday, August 13, 2024, 9:00 a.m. – 10:30 a.m. (PST).

The program will provide tax advisers and compliance professionals with a practical look at IRS guidance for calculating and reporting income and gain on cryptocurrency (e.g., Bitcoin) transactions. We’ll discuss the IRS’s latest positions on cryptocurrency, analyze IRS efforts to increase compliance and define proper reporting and the tax treatment for convertible virtual currency and cryptocurrency, stablecoins, as well as NFTs. We will address recently released Broker Reporting Regulations, the latest released IRS Guidance, the recent IRS enforcement initiatives to identify digital asset activity, how the IRS enforcement strategy fits into the voluntary disclosure practice, and the risks of criminal prosecution related to unreported and improperly reported cryptocurrency transactions. 

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For more information, please contact Michel R. Stein at stein@taxlitigator.com

For more information, please contact Evan Davis at davis@taxlitigator.com

For more information please contact Philipp Behrendt at behrendt@taxlitigator.com

We are pleased to announce that Jonathan Kalinski along with Ani Galyan (Galyan Law) will be speaking at an upcoming Strafford webinar on Tax Implications of Reclassifying Cannabis From a Schedule I to a Schedule III Drug, Tuesday, July 30, 2024, 10:00 a.m. – 11:30 a.m. (PST).

This webinar will provide tax professionals guidance on key tax implications of rescheduling cannabis from a Schedule I to a Schedule III drug. They will discuss the recent move by the Department of Justice to reclassify cannabis as a less harmful Schedule III drug under the Controlled Substances Act, its impact on federal and state-level taxation, Section 280E, and tax planning methods and reporting requirements for cannabis businesses under current tax law.

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For more information, please contact Jonathan Kalinski at kalinski@taxlitigator.com

In the ever-evolving financial technology landscape, virtual currencies, now more broadly termed “digital assets,” have emerged as a significant challenge for tax administration. The Treasury Inspector General for Tax Administration (TIGTA) recently released a comprehensive report titled “Virtual Currency Tax Compliance Enforcement Can Be Improved” (Report Number: 2024-300-030, dated July 10, 2024).  This report provides a critical examination of the Internal Revenue Service’s efforts to address tax compliance in the realm of digital assets.  As tax professionals, it is incumbent upon us to thoroughly understand and analyze these findings to better serve our clients and navigate the complex intersection of tax law and emerging financial technologies.

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For more information, please contact Steven Toscher at toscher@taxlitigator.com

For more information, please contact Philipp Behrendt at behrendt@taxlitigator.com

We are pleased to announce that Philipp Behrendt will be speaking on two  upcoming Beverly Hills Bar Association programs focused on the Review of New IRS Regulations on Digital Asset Transaction Reporting for Brokers, which will address the following topics:

July 23, 2024
10:00 a.m. – 11:30 p.m. (PST)
Application to the Broker and the Reporting Itself – What Attorneys Need to Know

This program will focus on the application of the final regulations, guiding attorneys who advise brokers and taxpayers on what to expect from broker reporting requirements. It will cover the specific obligations for brokers, including filing information returns and furnishing payee statements. This session will explain the processes involved, specifying who is required to report, the types of transactions covered, and the timelines for compliance. Attorneys will gain crucial insights into advising their clients on the practical aspects of broker reporting under the final regulations.

July 25, 2024
10:00 a.m. – 11:30 p.m. (PST)
Effects Beyond Broker Reporting – Computation of Gross Proceeds and Basis

This panel will examine the broader implications of the final regulations, particularly in relation to the computation of gross proceeds and basis, guiding attorneys on these critical issues. This session will discuss how the new reporting requirements influence the calculation of these financial metrics, which are essential for accurate tax reporting and compliance. Experts will explore the methodologies for determining gross proceeds and basis in digital asset transactions, highlighting the challenges and opportunities presented by the regulatory changes. Attorneys will gain valuable insights into advising their clients on these complex regulatory changes.

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For more information please contact Philipp Behrendt at behrendt@taxlitigator.com.

We are pleased to announce that Cory Stigile and Philipp Behrendt will be speaking at the upcoming CalCPA 2024 Annual Income Tax Seminar, Friday, July 26, 2024, 8:00 a.m. – 1:45 p.m. (PST) on the following topics:

Cory Stigile
New Enforcement Considerations

This session will cover the impacts of non-compliance, responding to IRS subpoenas, and recent penalty changes. Explore the implications of 6751(b), updates on ERC issues, and the process of participating in voluntary disclosure. Learn about amending tax returns, new provisions in H.R. 7024, and best practices for tax preparers to stay compliant and proactive. 

Philipp Behrendt
Practice Tips for Information Reporting

Stay ahead with the latest updates on 1099-K and 1099-DA (digital asset) forms. Learn why 1099s may not appear accurate and how to reconcile discrepancies, address 1099-K TPSO status, and utilize IRIS to avoid CP2000 notices. Expand your knowledge and enhance your practice with practical tips from industry experts.

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We are pleased to announce that Sandra R. Brown will be receiving the prestigious Richard Carpenter Excellence in Tax Award from the USD School of Law – RJS LAW Tax Controversy Institute. The Award is being presented at the 9th Annual USD School of Law – RJS LAW Tax Institute taking place July 19th in San Diego, California.

This award is given to an individual who exemplifies honesty, integrity, ethics, and compassion throughout their careers in the field of tax controversy and has demonstrated outstanding dedication and expertise while representing taxpayers before the federal and state governments.

Sandra is a Principal of the law firm Hochman Salkin Toscher Perez P.C., where she specializes in criminal tax matters as well as representing and advising taxpayers involved in complex and sophisticated civil tax controversies, including sensitive-issue audits, administrative appeals, and litigation in federal, state and tax court.

Prior to entering private practice, Sandra served as the Acting United States Attorney, First Assistant United States Attorney, and Chief of the Tax Division in the Office of the U.S. Attorney, Central District of California. During her 27 years as a trial lawyer, she personally handled over 2,000 tax cases on behalf of the United States before the United States District Court, the Ninth Circuit Court of Appeals, the United States Bankruptcy Court, the United States Bankruptcy Appellate Panel, and the California Superior Court. Included in those cases are two U.S. Supreme Court decisions and a multitude of published 9th Circuit decisions.

Sandra obtained her LL.M. in Taxation from the University of Denver, is a fellow of the American College of Tax Counsel, Vice-Chair of the ABA’s Section of Taxation’s Criminal and Civil Tax Penalties Committee, Co-Chair of the UCLA Tax Controversy Institute, and is a frequent lecturer and author on tax controversy topics, including international compliance matters. Sandra has been recognized as one of California’s top 100 leading women lawyers and Chambers for her excellence in serving her clients nationwide and internationally. 

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On June 20, 2024, the Supreme Court issued its decision in Moore v. United States, 603 U.S. ___, upholding the constitutionality of the Mandatory Repatriation Tax (“MRT”). While it was pending, the case was the subject of more commentary than any tax case in recent memory. Many commentators were in a twitter that a ruling in favor of the Moores would undermine many of the income tax provisions of the Internal Revenue Code (“IRC”). This was because if the Court held that to be taxable, income must be “realized” by the taxpayer, it would superimpose on the IRC the requirement that a taxpayer had to have actually receive the funds. Such a requirement would call into question the constitutionality of Subchapter K (taxation of partnerships), Subchapter S (taxation of S corporations) and a number of other provisions of the IRC. These fears proved unfounded.

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