Archive for Tax Court Cases

Tax Court In Brief: Short Summaries And Opinions

Tax Court In Brief: Short Summaries And Opinions

Ervin v. Commissioner, T.C. Memo. 2021-75 | June 23, 2021 | Lauber, J. | Dkt. No. 485-15

  • Opinion 

Short Summary: 

For nearly a decade, the taxpayer and his wife failed to file Federal income tax returns and made no payments.  The couple were indicted and convicted for tax evasion for a three-year period of the near-decade non-payment.  The following year, the taxpayer was ordered to pay restitution for the entire period of non-filing and non-payment.

After remanded to custody, the IRS completed a civil examination for the taxpayer’s individual income tax liabilities for a six-year period, which included years subject to the criminal court’s order for restitution. IRS prepared and certified a substitute for return for the relevant years. IRS, then, sent taxpayer two notices of deficiency for two three-year periods, providing for penalties.

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When Is The Accrual Method Available To Taxpayers? The Tax Court In The Morning Star Packing Company Case

When Is The Accrual Method Available To Taxpayers? The Tax Court In The Morning Star Packing Company Case

A Tax Court case addresses the accrual method of accounting in the cost-of-goods-sold (COGS) contexts:

The Morning Star Packing Company, L.P., et al. v. Comm’r, T.C. Memo. 2020-142 | October 14, 2020 | Cohen A. | Dkt. Nos. 5013-15, 5015-15, 16684-16, 16842-16

Short Summary:  Petitioners sought review of the IRS’ determination that they were not entitled to increase their cost of goods sold (“COGS”) for the costs to restore, rebuild, recondition, and retest their manufacturing facilities for years of 2008 – 2011.  The Tax Court found in favor of the IRS.

Key Issue:  Two key issues: (1) were certain accrued production costs fixed and binding where economic performance did not occur until the year following the tax year claimed for those costs; and (2) did Petitioners’ inclusion of such production costs in COGS for the years in issue result in a more proper match against income than inclusion in the taxable year.

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When Is The Accrual Method Available To Taxpayers? The Tax Court In The Morning Star Packing Company Case

When Is The Accrual Method Available To Taxpayers? The Tax Court In The Morning Star Packing Company Case

A recent Tax Court case addresses the accrual method of accounting in the cost-of-goods-sold (COGS) contexts:

The Morning Star Packing Company, L.P., et al. v. Comm’r, T.C. Memo. 2020-142 | October 14, 2020 | Cohen A. | Dkt. Nos. 5013-15, 5015-15, 16684-16, 16842-16

Short Summary:  Petitioners sought review of the IRS’ determination that they were not entitled to increase their cost of goods sold (“COGS”) for the costs to restore, rebuild, recondition, and retest their manufacturing facilities for years of 2008 – 2011.  The Tax Court found in favor of the IRS.

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