TAXLITIGATOR – Tax Controversy (Civil & Criminal) Report

We are pleased to announce that Michel R. Stein, will be speaking at the upcoming Summer Tax Summit IRS Civil Enforcement Priorities & Initiatives seminar on Tuesday, August 26, 2025, 1:30 p.m. – 2:20 p.m. (CDT) at the Missouri Athletic Club, St. Louis Missouri.

The panel will discuss the IRS’s renewed focus on collection efforts and the various tools the Service is using to promote compliance, along with practice tips for navigating the IRS Collection and Appeals processes.

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

We are pleased to announce that Robert S. Horwitz and Sebastian Voth, along with David J. Warner and Kevin Oveisi of Holtz, Slavett & Drabkin will be speaking at the upcoming myLawCLE Estate & Gift Tax Controversies: Mastering IRS Audits, Privilege Issues, and Tax Court Strategies live video broadcast on Thursday, August 21, 2025, 10:00 a.m. – 12:10 p.m. (PST).

This comprehensive two-hour program equips professionals with a strategic roadmap to effectively manage IRS involvement in estate and gift tax matters from the initial audit stage through potential Tax Court litigation. Understanding your client’s potential and varied tax authority audiences from audit through trial is essential to preserving your client’s best interests and optimizing tax mitigation strategies. The program covers critical considerations such as privilege protections, managing IRS summons and expert communications, and addressing anti-abuse doctrines. Participants will gain practical insights into the IRS examination process, the role of the Independent Office of Appeals, and how to prepare for potential litigation to ensure comprehensive client representation throughout the entire controversy lifecycle.

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For more information, please contact Robert S. Horwitz at horwitz@taxlitigator.com

For more information, please contact Sebastian Voth at voth@taxlitigator.com

We are pleased to announce that Michel R. Stein, Evan J. Davis and Philipp Behrendt will be speaking at the upcoming CalCPA Cryptocurrency Tax Compliance webinar, Tuesday, August 12, 2025, 9:00 a.m. – 10:30 a.m. (PST).

The IRS continues to press its concern over massive under-reporting of income from cryptocurrency and other digital asset transactions. Tax advisers for clients with cryptocurrency holdings must understand the reporting requirements for transfers and the IRS scrutiny cryptocurrency investors are likely to face in the future.

Cryptocurrency is a digital asset using cryptographic techniques–rather than a central authority–to secure transfer currency units. Uniquely, no bank or government authority records the transfer of funds. And yet, the digital asset world will see its own Information Reporting (1099-DA) beginning with transactions in 2025.

The rise of Bitcoin’s value has prompted a massive compliance initiative aimed to identify taxpayers’ gain with audits going back to inceptions of the taxpayer’s trading activity. The IRS treats digital assets as property rather than currency for U.S. tax purposes. As a result, any transaction involving cryptocurrency is treated as a taxable sale or exchange of property, with taxpayers responsible for tracking their cost basis, gains, and losses.

We will discuss IRS enforcement actions focused on digital assets, providing an overview of the IRS’s guidance on various transactions, and provide practical guidance on the U.S. tax reporting obligations arising from cryptocurrency transactions.

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

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

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

Dear Colleague-

Registration is now open for the 2025 UCLA Extension Tax Controversy Institute, which will be held this year on October 23, 2025 at the Beverly Hills Hotel. It will be the 41st Institute and you will not want to miss it.

We are looking forward to the following special guest speakers at this year’s Institute.

Billy Long, Commissioner
Internal Revenue Service

Patrick J. Urda, Chief Judge
United States Tax Court

Guy Ficco
Chief Criminal Investigation Division
Internal Revenue Service

Key Topics this year will include –

Franchise Tax Board Controversies and the California Office of Tax Appeals

The Future Direction of Criminal Tax Enforcement

IRS Collection Procedures – Opportunities and Pitfalls

Valuation in Tax Enforcement- Critical to Our

Voluntary Compliance System

Best Practices in Refund Litigation

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We are pleased to announce that Michel R. Stein, Robert S. Horwitz and Sebastian Voth will be speaking at the upcoming CalCPA Federal and State Residency Issues webinar, Tuesday, July 22, 2025, 9:00 a.m. – 10:30 a.m. (PST).

This webinar will guide tax professionals and advisers on the latest IRS residency examination guidance and California residency issues. The panel will discuss federal and state tax residency rules, California residency issues, income allocation issues in the residency context, managing residency audits, and best practices for advising clients who are considering leaving California. California state tax residency rules, and an increase in residency audits and enforcement, require tax professionals to know state residency and income allocation issues, so they can properly advise their clients when these issues arise.

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

For more information, please contact Robert S. Horwitz at horwitz@taxlitigator.com

For more information, please contact Sebastian Voth at voth@taxlitigator.com

In California, not all written decisions published by the Office of Tax Appeals (OTA) carry the same weight. Only those designated as precedential—after a formal process established in California Code of Regulations, Title 18, Section 30502—serve as binding guidance in future appeals. An opinion becomes precedential only if it introduces a new legal interpretation, resolves conflicts, addresses a matter of ongoing public importance, or significantly contributes to tax law. OTA’s Chief Counsel, in consultation with OTA staff, determines which opinions should be precedential. Each opinion determined to be precedential is published as “Pending Precedential,” subject to public comment, and then designated as either Precedential or Nonprecedential. Members of the public may propose that any opinion be given precedential effect.

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For more information, please contact Robert S. Horwitz at horwitz@taxlitigator.com

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

Please join us July 18, 2025 for the 10th Annual USD School of Law – RJS Law Tax Controversy Institute at the San Diego Joan B. Kroc Institute for Peace and Justice Theatre.

We have an excellent line up of programs –

Criminal Workshop Panel: Criminal Prosecution Under the New Administration What to Expect 
Featuring Steven Toscher

Crypto Currency – “A Whole New Digital World”
Featuring Philipp Behrendt

The Institute is the premier tax event in San Diego. The region’s top tax attorneys, CPAs, and law/business school professors will discuss topics including government loan relief and abuses, challenges in cross-border transactions, and practical and realistic solutions in Trust, Estate Planning, and Tax matters. 

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

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

In a rare and welcomed victory for taxpayer rights and administrative fairness, the IRS has agreed to remove the willfulness checkbox from the next version of the Form 14457—the application form for the Voluntary Disclosure Practice (VDP). In addition, the program will make allowances not to preclude income derived from marijuana sales by changing its definition of illegal source income. 

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

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

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

On July 3, 2025, the House of Representatives narrowly passed the Republicans’ sweeping reconciliation package, the One Big Beautiful Bill, by a 218-214 vote, which President Trump signed on July 4. The legislation marks the most extensive tax package since the 2017 Tax Cuts and Jobs Act (TCJA), making many of the TCJA’s temporary provisions permanent and introducing a new set of incentives and enforcement priorities.

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

For more information, please contact Robert S. Horwitz at horwitz@taxlitigator.com

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

The IRS has the power to administratively collect an assessed tax liability through filing a notice of federal tax lien and through levying on a taxpayer’s property. Because the exercise of this power can have serious consequences for a taxpayer, Congress in Internal Revenue Code (“IRC”) §6330 gave taxpayers the opportunity to request a hearing before the Independent Office of Appeals before a levy is made. During such a “collection due process” (“CDP”) hearing, the taxpayer may raise any relevant issue to the unpaid tax or the proposed levy, including a challenge to the existence or amount of the underlying liability if the taxpayer did not previously have an opportunity to dispute the liability. After the hearing, the appeals officer is required to make a determination. In doing so, the appeals officer is required to consider various factors, including any issue raised by the taxpayer. Within thirty days of the determination, the taxpayer can petition the Tax Court for review of the determination. A decision of the Tax Court in a CDP case is reviewable by a federal appeals court.

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For more information, please contact Robert S. Horwitz at horwitz@taxlitigator.com