Alston & Bird Tax Blog

Penalties

Federal Tax Advisory: An Unusual F/D(?) Reorganization

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This advisory discusses IRS LTR 201406005, which evidently blessed as an F or D reorganization the transfer by a subsidiary of all of its assets to its parent corporation, despite the fact that the parent had previously bought an asset from its parent by assuming a liability greater than the value of the asset.

The full advisory is provided on the Alston & Bird website: http://www.alston.com/advisories/fed-tax-march-2014/

Federal Tax Advisory – Tax Officer Failed to Write His Own Opinion

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This advisory discusses how the Tax Court applied the economic substance doctrine in Gerdau MacSteel, Inc., 139 TC No. 5 (August 30, 2012), and denied penalty relief in a liability management company “tax shelter” case because the company’s tax department failed to either obtain an outside opinion or write its own. The advisory is provided in PDF on the Alston & Bird website: www.alston.com/advisories/federal-tax-advisory-federal-tax-report-october-2012 [...]Read more

International Tax Advisory: The Seventh Circuit Applies Required Records Doctrine to Foreign Bank Account Records, Overriding Claim of Fifth Amendment Privilege

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This advisory discusses a recent decision by the Seventh Circuit Court of Appeals, where the court held that the Required Records Doctrine (RRD or the “doctrine”) compelled production of subpoenaed foreign bank account records, which were required to be maintained under the Bank Secrecy Act. The district court had quashed the subpoena, concluding that it would violate the Fifth Amendment privilege against self-incrimination. The government appealed, and the court of appeals reversed the lower court’s order. The advisory is provided in PDF on the Alston & Bird website: www.alston.com/advisories/international-tax-advisory-september-2012 [...]Read more

International Tax Advisory – U.S. Treasury Releases Model FATCA Intergovernmental Agreement

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In February 2012, Treasury issued a joint statement with France, Germany, Italy, Spain and the United Kingdom regarding plans for an intergovernmental approach to implement the Foreign Account Tax Compliance Act (FATCA). FATCA, a part of the Hiring Incentives to Restore Employment Act of 2010, provides for a withholding tax to enforce reporting requirements for certain U.S.-owned foreign accounts. Under FATCA, a withholding agent must withhold a 30 percent tax on any “withholdable payment” to a foreign financial institution (FFI) or nonfinancial foreign entity that fails to disclose [...]Read more

Home Concrete Decided: Taxpayer Wins

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On April 25, 2012 the Supreme Court ruled that the overstatement of the basis of property sold, resulting in a substantial understatement of gain, is not an omission from gross income, and so the three year and not the six year statute of limitations applied to the taxpayer’s assessment, meaning the assessment came too late. United States v. Home Concrete & Supply, LLP, 2012 U.S. LEXIS 3274, affirming, 634 F.3d 249 (4th Cir. 2011). Stare Decisis. The plurality opinion of Justice Breyer relied squarely on Colony, Inc. v. Commissioner, 357 U.S. 28 (1958), which appeared to have, and the [...]Read more