Paul L. Caron
Dean
Pepperdine Caruso
School of Law
IRS News
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Man Arrested for Spending $110k IRS Mistakenly Deposited in His Bank Account
Stephen McDow of Laguna Beach, California has been jailed for spending the $110,000 federal tax refund that the IRS erroneously deposited in his Citibank account. The refund was intended for a Los Angeles woman who requested that the funds be deposited in her Citibank account, but she gave the IRS her old account number that had been reassigned to Mr. McDow. CBS…
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Forbes: The IRS’s War Against Charitable Donations of Facade Easements
Forbes: Feds Sue Trust Over Historic Easement Tax Breaks, by Janet Novack: The IRS’s seven year campaign against questionable charitable deductions for the donation of historic building facade easements has ratcheted up another notch. On Tuesday, the Department of Justice filed a lawsuit seeking to enjoin the non-profit Trust for Architectural Easements from practices that…
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TIGTA: IRS Did Not Follow Law in 38% of Seizures of Taxpayer Property
The Treasury Inspector General for Tax Administration yesterday released Fiscal Year 2011 Review of Compliance With Legal Guidelines When Conducting Seizures of Taxpayers’ Property (2011-30-049): In conducting its statutory review, TIGTA reviewed a random sample of 50 of the 578 seizures conducted from July 1, 2009 through June 30, 2010, to determine whether the IRS…
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GOP Demands Answers From IRS on Gift Tax Probe of 501(c)(4) Groups
House Ways & Means Committee Chair Dave Camp today released a letter he sent to the IRS demanding information about its recent investigation on the possible application of the gift tax to 501(c)(4) groups: Camp questioned the process leading up to this action and level of involvement by the Obama Administration. … “Every aspect of this tax investigation,…
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IRS Releases Spring 2011 SOI Bulletin
The IRS’s Statistics of Income Division yesterday released (IR-2011-67) the Spring 2011 SOI Bulletin (Vol. 30, No. 4), with these articles: High-Income Tax Returns for 2008 (p. 5), by Justin Bryan Individual Income Tax Returns, by Age of Primary Taxpayer, Tax Years 1997 and 2007 (p. 55), by Jeff Curry & Jonathan Dent Individual Income Tax Returns, by State, 2007 (p.…
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IRS Notice Stems Exodus of Small eBay Sellers to Craigslist
In Notice 2011-42, 2011-23 I.R.B. ___ (June 6, 2011), the IRS ruled that third-party payment processors such as EBay’s PayPal service do not need to collect taxpayer identification numbers or withhold taxes from sellers who have 200 or fewer transactions in a year. Richard Rubin notes on Bloomberg Government (subscription) that EBay’s IRS Reprieve Prevents…
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Did Michigan, George Washington University Lose Their Tax Exempt Status?
Following up on Thursday’s post, IRS Strips Tax-Exempt Status From 275,000 Nonprofits: Chronicle of Philanthropy, Mistakes in IRS List Cause Headaches for Some Nonprofits: Nonprofits around the country have found both alarming and reassuring news as they have reviewed the list of 275,000 groups whose tax exemptions the IRS revoked on Wednesday. The IRS took action…
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NY Times: IRS Apologizes to 300 California Gay & Lesbian Taxpayers
New York Times, From IRS to Gay Couples, Headaches and Expenses, by Scott James: The IRS, not exactly known as a bastion of compassion, had these words for gay and lesbian couples this week: we’re sorry. The public apology was in response to inquiries from The Bay Citizen about problems faced by same-sex couples, most…
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Low Income Taxpayer Clinic Grant Recipients
The IRS announced today (IR-2011-65) that it has awarded nearly $10 million in matching grants to Low Income Taxpayer Clinics (LITCs) for the 2011 grant cycle (Jan. 1, 2011 through Dec. 31, 2011). Through the LITC program, the IRS awards matching grants of up to $100,000 a year to qualifying organizations. For the 2011 grant cycle, the…
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IRS Milestone: One Billion e-Filed Tax Returns
The IRS announced today (IR-2011-64) that its e-file program has reached a major milestone: one billion individual tax returns have been processed since the e-file program launched in 1986: The IRS’s electronic filing program started as a pilot project in 1986 and became available nationally in 1990. … “IRS e-file is a good deal for taxpayers,” said IRS Commissioner…
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Commissioner: IRS Budget Cuts Would Increase Deficit
IRS Commissioner Douglas Shulman testified yesterday that proposed cuts to the IRS’s budget would increase the budget deficit by hindering his agency’s ability to collect taxes. Instead, he argued that a 10% budget increase in the IRS’s budget is needed to help close the tax gap and implement ObamaCare. Bloomberg Going Concern Wall Street Journal Washington…
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IRS Strips Tax-Exempt Status From 275,000 Nonprofits
The IRS yesterday announced (IR-2011-63) that 275,000 organizations have automatically lost their tax-exempt status for failure to file Form 990s for three consecutive years, and announced (Announcement 2011-35) the publication of the list of those organizations on its website. The IRS also issued guidance (Rev. Proc. 2011-33, Notice 2001-43, Notice 2001-44) on how organizations can apply for reinstatement of their…
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IRS Allows Millions in Erroneous Car Deductions to Prisoners, Dead People, Kids
The Treasury Inspector General for Tax Administration yesterday released Millions of Dollars in Questionable Qualified Motor Vehicle Deductions Are Being Allowed (2011-41-037): The American Recovery and Reinvestment Act of 2009 (Recovery Act) provides individuals with a Qualified Motor Vehicle (QMV) deduction, which is an additional deduction for State sales tax and excise tax on the purchase of…
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IRS Responds to GOP Questions on Application of Gift Tax to 501(c)(4) Groups
Following up on my prior post, GOP Questions IRS on Applying Gift Tax to Contributions to 501(c)(4) Groups (May 19, 2011): IRS Commissioner sent this May 31 letter (via BNA) in response: Your letter raises the general question regarding whether IRS enforcement policy as it pertains to 501(c)(4) organizations is influenced by political considerations. As…
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Taxpayer ID Theft Has Increased 400% in 2 Years; IRS Apologizes to 3 Victims
The House Committee on Oversight & Government Reform yesterday held a hearing on IRS E-File and Identity Theft. Jim White (Director of Strategic Issues, Government Accountability Office) testified at the hearing, Status of IRS Initiatives to Help Victimized Taxpayers (GAO-11-721T): My testimony today will cover (1) when IRS detects identity theft-based refund and employment fraud,…
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TIGTA Submits Semiannual Report to Congress
The Treasury Inspector General for Tax Administration today submitted its Semiannual Report to Congress: It gives me great pleasure to submit this Semiannual Report to Congress summarizing the accomplishments of the TIGTA for the reporting period of October 1, 2010 through March 31, 2011. This report highlights the most notable audits, investigations, and inspections and…
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Barone, Froomkin on the IRS’s Use of the Gift Tax Against § 501(c)(4) Groups
Washington Examiner, Obama Skirts Rule of Law to Reward Pals, Punish Foes, by Michael Barone: One basic principle of the rule of law is that laws apply to everybody. If the sign says “No Parking,” you’re not supposed to park there even if you’re a pal of the alderman. Another principle of the rule of…
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IRS Seeks Grant Applications for Low Income Taxpayer Clinics
The IRS has announced (IR-2011-56) that it is accepting grant applications for Low Income Taxpayer Clinics for the 2012 grant cycle (Jan. 1 – Dec. 31, 2012): Applications will be accepted May 23, 2011, through June 30, 2011. Previous grant recipients will have the option to apply for up to three years of annual funding, which would…
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IRS Tax Forms, 1864-
Sarah Lawsky (UC-Irvine) passed along this great resource: IRS tax forms from 1864 onward:
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6th Cir: IRS Tax Lien Has Priority Over Mortgage Lien Filed in Wrong County
Mortgage Electronic Registration Systems Inc. v Tammy Church, No. 09-2513 (6th Cir. May 19, 2011): It sometimes pays to check a map. The mortgage lender in this case did not, and as a result it recorded an interest in Tammy Church’s property in the wrong county. Luckily for the public fisc, the IRS, which also placed…
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WSJ: High-Tech Elevators Separate Lawyers From IRS Agents
Wall Street Journal, The Most Awkward Meeting: New Elevators Sort Employees, Foiling Manners and Face Time: The “elevator pitch” is a staple of office lore: a go-getter’s well-prepared catchy idea that is ready for any chance meeting with the top boss. Well played, it impresses fast and sends an employee’s career rocketing. Fumbled, the elevator ride…
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Kristan: Is the Gift Tax Law on the Side of 501(c)(4) Donors?
Following up on this morning’s post, GOP Questions IRS on Applying Gift Tax to Contributions to 501(c)(4) Groups, Joe Kristan asks Can Political Contributions Really be Taxable Gifts?: The question I have is: if these are taxable gifts, why didn’t anybody seem to know this until now? It turns out that the IRS tried to…
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30% IRS Error Rate in $6b Home Energy Tax Credit, Including Claims by Prisoners
The Treasury Inspector General for Tax Administration today released Processes Were Not Established to Verify Eligibility for Residential Energy Credits (2011-41-038): More than 6.8 million individuals claimed more than $5.8 billion in Residential Energy Credits on Tax Year 2009 tax returns processed through December 31, 2010. … The IRS cannot verify whether individuals claiming Residential Energy Credits…
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Tax Policy Center to Co-host IRS Research Conference on June 23
Following up on last month’s post, IRS Cancels 2011 Research Conference Due to Budget Cuts: The IRS is pleased to announce that it will co-host a one-day research conference in June with the Urban-Brookings Tax Policy Center (TPC). It will be different from prior IRS research conferences in several key respects: It will last just…
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IRS Oversight Board Releases 2010 Annual Report to Congress
The IRS Oversight Board has released its 2010 Annual Report to Congress: The IRS Oversight Board is pleased to have the opportunity to report to the President, Congress, and taxpayers on the progress the IRS is making in achieving its mission: to provide America’s taxpayers top-quality service by helping them understand and meet their tax responsibilities…