Houston Tax Attorney: Tax Disputes Blog

Loaning Money to Business Triggers Trust Fund Penalty

Houston Tax Attorney

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You work hard to build a business, you find success over the years, and then you find out that your long term accountant did not remit payroll taxes and you owe a significant balance.  What do you do?  The recent McClendon v. United States, No. 17-20174 (5th Cir. 2018) case provides some answers. The Facts & Procedural […]

Shareholder Cannot Make S Corp. Separately Stated Item Election

Houston Tax Attorney

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S corporation’s account for separately stated items that flow through to the shareholder’s tax returns. They are computed on page 3 of the Form 1120S and then listed separately on the Schedule K-1. The idea for breaking these items out separately is that they can impact the shareholder’s individual returns differently. That makes sense, but […]

The Statutory Employee Classification Post-TCJA

Houston Tax Attorney

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The Tax Cuts and Jobs Act (“TCJA”) made several changes to our tax laws. One such change is that employees are no longer able to deduct unreimbursed expenses incurred as an employee. Given this change, employers and their workers may need to re-evaluate their relationship. For some workers, this may mean re-evaluating whether the worker […]

Guaranteeing a Loan for Your S Corporation

Houston Tax Attorney

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In Phillips v. Commissioner, No. 17-14439 (11th Cir. 2018), the court concluded that a judgment against the owner of an S corporation for guaranteeing the business debts does not increase the owners tax basis in the S corporation.  This is one area where a little advance planning can go a long way to avoiding a tax […]

Court Says No Legal Right to IRS Appeals Review

Houston Tax Attorney

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Does the Taxpayer Bill of Rights create a legal right to have a tax dispute considered by the IRS Office of Appeals?  The court recently addressed this question in Facebook, Inc. v. Internal Revenue Service, No. 17-cv-06490-LB (N.D. Calif. 2018), concluding that there is no legal right to have an administrative appeal for a tax dispute. Facts […]

When the IRS Raises A New Matter on the Eve of Trial

Houston Tax Attorney

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During the course of litigating a tax matter, the IRS may increase the amount of tax, penalties, and interest that it alleges the taxpayer owes. The IRS is typically allowed to do this. If it does, the IRS may have a harder time prevailing on this type of issue. This “new matter” rule was recently […]

Deducting Fringe Benefits for Family Members

Houston Tax Attorney

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Small business owners often look for ways to reduce their taxes.  With family businesses, these plans often involve employing the owner’s children.  This raises the question of whether a small business owner employ their children as independent contractors and deduct seemingly personal expenses for the children as fringe benefits if the children did in fact […]