Celebration time at the IRS!

Did you hear that champagne cork pop from Washington, D.C.? I think we all did as this past week the Supreme Court denied certiorari in Coltec Industries, Inc. v. United States, 454 F.3d 1340 (Fed. Cir. 2006). The obvious question becomes - Now What? Continue Reading...

Ramblings: So what was argued in Klamath Strategic Investment Fund, LLC v. United States, --- F.Supp.2d ----, 2007 WL 283790 (E.D.Tex.. 2007)?

I will “blame” the severe weather conditions in the Northeast for the lack of cases reported this week. But thanks to Tax Notes Today, tax practitioners were able to see what the Government argued in Klamath and taxpayer’s response.

Before I get to those arguments, if you like this kind of transparency then take notice that the United States Tax Court is accepting comments as to the amendments to its proposed rules. Under the proposed rules, only if you live in the Washington DC area will you have access to its electronic filings. Otherwise, you will still have to contact the Docket room and obtain a hard copy.
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KPMG and the Government's "Prosecution of KPMG" - Can we learn any lessons from this investigation with the approach of FIN 48?

When I assisted large case examiners during the period of time that “tax solutions” were being marketed, I used to quip that I would love to know what was going on in those meetings wherein the accounting firm was making the tax department into a profit center. So I must admit, I have been fascinated with the ongoing investigation into KPMG. Unfortunately, I have a learned a bitter lesson: “be careful what you ask for you may get it”. It appears what we are all getting is a lesson in constitutional rights that is frankly alarming to those that follow/practice law let alone tax law. Continue Reading...

Klamath, Estate of Kanter, and IRS's Announces Civil/Criminal Enforcement in Foreign Transactions

Two opinions were announced this week - Klamath Strategic Investment Fund, LLC v. United States, --- F.Supp.2d ----, 2007 WL 283790, (E.D.Tex.. 2007); Estate of Kanter v. Commissioner, T.C. Memo. 2007-21. These two opinions were highly anticipated as they afforded the respective Courts an opportunity to interpret new judicial doctrines/rules and answer questions concerning the trial judge’s role in evaluating and determining witness credibility.

In addition, in three separate publications, the IRS’s criminal and civil intentions as to foreign transactions were broadcast.

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Estate of Kanter v. Commissioner, T.C. Memo. 2007-21

One of the most highly anticipated decisions was rendered today. The opinion is 457 pages long and as to the issue of fraud, the Tax Court (Judge Haines) found for the IRS.  As we are aware the Supreme Court in Ballard v. Commissioner, 544 U.S. 40 (2005) reversed the Eleventh Circuit and the Seventh Circuit because the United States Tax Court was found not to have followed T.C. Rule 183.  

By order dated July 10,2006, the Eleventh Circuit instructed the Tax Court as follows:

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