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Innocent Spouse Relief, Equitable Factors Under Section 6015(f)

Innocent Spouse Relief, Equitable Factors Under Section 6015(f)

Parker v. Commissioner, T.C. Memo. 2022-110 | November 15, 2022 |Paris, J.| Dkt. No. 6054-19

Short Summary: This case involves whether a taxpayer is entitled to relief from joint and several liability regarding a deficiency in federal income tax under 26 U.S.C. § 6015(f).  Haywood Earl Parker Jr. (Parker) and Jaqueline Ann Parker (Ann Parker) married in 1988 and divorced in April 2018. Parker has severe health problems and his only income as of 2012 arises from Social Security (SS) disability payments. Ann Parker received a ­settlement award in relation to a discrimination claim she asserted against her employer. The Parkers filed their joint tax return for 2016, where they excluded the attorney’s fees or noneconomic and compensatory damages from the settlement amount. They considered those amounts were non-taxable from a call held with the IRS.

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IRS Promises More Enforcement Of Foreign Nationals In The United States

ALICEA CASTELLANOS

A newly re-funded IRS is promising more scrutiny on non-U.S. citizens over taxes. Protecting yourself in this new environment means knowing American tax rules and proactively getting the right help.

Foreign nationals living and working in the U.S. may soon be in the crosshairs of a re-energized Internal Revenue Service.

A representative of the IRS Office of Chief Counsel reportedly told an audience at a recent American Bar Association Tax Section conference that compliance among foreign nationals in the U.S. will be a priority and focus of the IRS.

This comes on the heels of the tax agency getting some $80 billion from the landmark U.S. Inflation Reduction Act signed into law last August. The IRS will receive the money over a decade, with a major portion of the funds earmarked for enforcement (and hiring as many as 87,000 new agents).

That number may be deceptive – heavy attrition in personnel and many past years of underfunding may mean the agency mostly replaces what it’s lost – but the IRS has still pledged sharper scrutiny on rich tax cheatscrypto investors and others to close America’s huge gap in tax collection.

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Tax Director, US Tax Opportunity (2.5B Global Media Company)

Tax Director, US Tax Opportunity (2.5B Global Media Company)

TaxConnections Executive Search Services division has been retained to conduct a search for a Director, US Tax Group for a large integrated producer broadcaster listed on the UK Stock Exchange. As one of the largest media networks in Europe, this media company creates and distributes a wide range of high quality, world-class content, and award winning, family-oriented entertainment for viewers.

We sincerely appreciate your taking the time to review this opportunity and forward this to anyone you believe would like to learn more. Your privacy is always protected working with us!

Director, US Tax Group (Company Flexible On Location)

This 2.5B, public listed global media company creates and distributes scripted and unscripted entertainment. It has studio business in 12 countries outside of the U.K, including a sizeable business in the U.S. Given their major centers of activity in New York, New Jersey, Connecticut, California (San Francisco, North Hollywood, Los Angeles), Colorado, Georgia, Louisiana, London, the company is open and flexible on location for the role of the
Director, US Tax Group.

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SEC Charges Kim Kardashian For Unlawfully Touting Crypto Security

SEC Charges Kim Kardashian For Unlawfully Touting Crypto Security

The Securities and Exchange Commission announced charges against Kim Kardashian for touting on social media a crypto asset security offered and sold by EthereumMax without disclosing the payment she received for the promotion. Kardashian agreed to settle the charges, pay $1.26 million in penalties, disgorgement, and interest, and cooperate with the Commission’s ongoing investigation.

The SEC’s order finds that Kardashian failed to disclose that she was paid $250,000 to publish a post on her Instagram account about EMAX tokens, the crypto asset security being offered by EthereumMax. Kardashian’s post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens.

“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors,” said SEC Chair Gary Gensler. “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”

“Ms. Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities,” Chair Gensler added.

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You Are Invited To Open House In Provo, Utah On Friday, November 18th 2022 To MIT Modular Manufacturing Facility

You Are Invited To Mit Modular

Event: Open House To MitModular
Place: In Person, Provo, Utah, MITModular Manufacturing Facility
Date: Friday, November 18th, 2022
Invitation: Contact Individuals Listed Below To Secure Your Private Invitation. Real Estate Investors Love This Tax Deferral Program

MIT Modular is proud to showcase its new 20,000 sq. ft. manufacturing facility where we are taking single-use shipping containers and developing them into power-positive, sustainable housing models (ranging from single-unit Accessory Dwelling Units to multi-family, stackable designs). Be on the lookout for your official invite!

Combining the sustainable, flexible, and cost-effective modular housing designs with the community renovation focus of the federal Opportunity Zone Program, makes MIT Modular a national model for helping solve the housing shortage while creating well-paying jobs and improving under-served communities. We are well-positioned to supply creative and functional housing to a variety of consumers including low-income, homeless, workforce, vacation, AirBnB landlords, retail, and special-purpose users.

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SEC Statement Urging Caution Around Celebrity Backed ICOs

CAUTION

SEC Division of Enforcement and SEC Office of Compliance Inspections and Examinations

 (This “Caution Notice” Was Posted On The SEC Site Nov. 1, 2017)

Celebrities and others are using social media networks to encourage the public to purchase stocks and other investments.  These endorsements may be unlawful if they do not disclose the nature, source, and amount of any compensation paid, directly or indirectly, by the company in exchange for the endorsement.  The SEC’s Enforcement Division and Office of Compliance Inspections and Examinations encourage investors to be wary of investment opportunities that sound too good to be true.  We encourage investors to research potential investments rather than rely on paid endorsements from artists, sports figures, or other icons.

Celebrities and others have recently promoted investments in Initial Coin Offerings (ICOs).  In the SEC’s Report of Investigation concerning The DAO, the Commission warned that virtual tokens or coins sold in ICOs may be securities, and those who offer and sell securities in the United States must comply with the federal securities laws.  Any celebrity or other individual who promotes a virtual token or coin that is a security must disclose the nature, scope, and amount of compensation received in exchange for the promotion.  A failure to disclose this information is a violation of the anti-touting provisions of the federal securities laws.  Persons making these endorsements may also be liable for potential violations of the anti-fraud provisions of the federal securities laws, for participating in an unregistered offer and sale of securities, and for acting as unregistered brokers.  The SEC will continue to focus on these types of promotions to protect investors and to ensure compliance with the securities laws.

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Risk Of Holding Digital Assets Through Custodial Wallets

Holding Digital Assets Through Custodial Wallets

Non-Custodial Wallets v. Custodial Wallets: Considerations for Holding Digital Assets

Introduction: The FTX Collapse, Custodial Wallets, and Bankruptcy Concerns

The recent headlines regarding cryptocurrency exchange FTX’s collapse, and subsequent bankruptcy filing have put renewed focus on whether customers of a cryptocurrency exchange should hold digital assets through a custodial wallet. When a customer holds digital assets through a custodial wallet the service provider holds both the public key and the private key and effectively has control over the assets. The issue for cryptocurrency exchange customers is if a cryptocurrency exchange files for bankruptcy protection are the customers’ digital assets property of the exchange’s bankruptcy estate and available to be used to satisfy debts of other creditors? Bankruptcies involving cryptocurrency exchanges or cryptocurrency lending platforms is a developing area of the law and presents issues of first impression. Recent cryptocurrency bankruptcies include Voyager Digital LLC, Celsius Network LLC, and most recently FTX Trading Ltd. If customers of a cryptocurrency exchange or cryptocurrency lending platform hold their digital assets in a custodial wallet, rather than a non-custodial wallet (i.e., a private wallet), it may increase the risk that such assets are treated as corporate assets of the exchange or lending platform.

Risks of Holding Digital Assets in a Custodial Wallet

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IRS Automated Underreporter Program, Gifts From Employer, Accuracy-Related Penalty

IRS Automated Underreporter Program, Gifts From Employer, Accuracy-Related Penalty

Freeman Law Tax Court In Brief

Fields v. Comm’r, T.C. Summary Opinion 2022-22 | November 10, 2022 | Panuthos, Special Trial J. | Dkt. No. 2925-20S (IRS Automated Underreporter, gifts from employer, unreported gross income, and accuracy-related penalty)

Summary: Pursuant to 26 U.S.C. § 7463(b), this decision is not reviewable by any other court, and the opinion shall not be treated as precedent for any other case. The case regards a deficiency determination and a 26 U.S.C. § 6662(a) accuracy-related penalty assessed against petitioners, Jennifer Fields (“Jennifer”) and Walter Fields (with Jennifer, the “Fields”). Jennifer worked for Paragon Canada ULC. Paragon Canada ULC operated in Canada, and it operated in the U.S. as Paragon Gaming (collectively, Paragon). She had a personal relationship with the CEO of Paragon, Scott Menke. On a few occasions, Paragon wired funds to or for Jennifer’s personal benefit, such as for use as a down payment to purchase a residence or other unspecified.

In January 2017, she separated from Paragon. In a severance agreement, the respective parties agreed to a write-off of certain employee advances totaling $79,581.50. A revised draft severance agreement modified the consideration but was never signed. Jennifer executed a Form W–9, Request for Taxpayer Identification Number and Certification, which was provided to Paragon. Paragon issued to Jennifer and filed with the IRS a Form 1099–MISC, reporting $79,581 in other income for the year in issue.

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Information Security And The Clean Vehicle Credit

Information Security And The Clean Vehicle Credit

The Inflation Reduction Act of 2022 added and modified several energy credits. They are all fairly complex in terms of restrictions and numerous definitions. See prior posts on some of this complexity:

Section 30C Refueling Property Credit (9/18/22)

Various credits with track changes links to several including the section 30D Clean Vehicle Credit (8/21/22)

One item that seems odd in the revised section 30D, Clean Vehicle Credit is the 8th of 8 elements of the definition of a “clean vehicle”. This requirement at §30D(d)(1)(H) provides that the seller must furnish a report to the taxpayer ad the IRS in guidance to be provided by the IRS. In addition to logical items like the taxpayer’s name, the vehicle’s VIN and whether the car meets the critical minerals and battery component requirements, it calls for the buyers tax identification number. We can see why the IRS wants that information but why should the buyer have to provide their TIN to the seller? This is contrary to one of the 12 principles of good tax policy – Information Security.

Hopefully the IRS will come up with secure ways to enable this requirement to occur. For example, the taxpayer could be directed to a website to obtain an identification number usable only for the report (a number other than their Social Security number), perhaps similar to getting an EIN.

What do you think? Professor Annette Nellen, San Jose State University.

SEC Nearly Doubles Size of Enforcement’s Crypto Assets and Cyber Unit

SEC Nearly Doubles Size of Enforcement’s Crypto Assets and Cyber Unit

We thought our readers would appreciate reading this announcement from the SEC May 3, 2022.

———————————————————–

FOR IMMEDIATE RELEASE
2022-78

Washington D.C., May 3, 2022 —

The Securities and Exchange Commission today announced the allocation of 20 additional positions to the unit responsible for protecting investors in crypto markets and from cyber-related threats. The newly renamed Crypto Assets and Cyber Unit (formerly known as the Cyber Unit) in the Division of Enforcement will grow to 50 dedicated positions.

“The U.S. has the greatest capital markets because investors have faith in them, and as more investors access the crypto markets, it is increasingly important to dedicate more resources to protecting them,” said SEC Chair Gary Gensler. “The Division of Enforcement’s Crypto Assets and Cyber Unit has successfully brought dozens of cases against those seeking to take advantage of investors in crypto markets. By nearly doubling the size of this key unit, the SEC will be better equipped to police wrongdoing in the crypto markets while continuing to identify disclosure and controls issues with respect to cybersecurity.”

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You Are Invited To A Manufacturing Facility Opening: A Tax Deferred Opportunity Zone Program In Provo, Utah

You Are Invited To A Manufacturing Facility Opening: A Tax Deferred Opportunity Zone Program In Provo, Utah

Event: Open House To MitModular
Place: In Person, Provo, Utah, MITModular Manufacturing Facility
Date: Friday, November 18th, 2022
Invitation: Contact Individuals Listed Below To Secure Your Private Invitation. Real Estate Investors Love This Tax Deferral Program

MIT Modular is proud to showcase its new 20,000 sq. ft. manufacturing facility where we are taking single-use shipping containers and developing them into power-positive, sustainable housing models (ranging from single-unit Accessory Dwelling Units to multi-family, stackable designs). Be on the lookout for your official invite!

Combining the sustainable, flexible, and cost-effective modular housing designs with the community renovation focus of the federal Opportunity Zone Program, makes MIT Modular a national model for helping solve the housing shortage while creating well-paying jobs and improving under-served communities. We are well-positioned to supply creative and functional housing to a variety of consumers including low-income, homeless, workforce, vacation, AirBnB landlords, retail, and special-purpose users.

Top-Rated OZ Location – Provo, Utah
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Obtaining Extension To Make §754 Election

Obtaining Extension To Make §754 Election

Private Letter Ruling 202244002, November 4, 2022

In a recent Private Letter Ruling, the Internal Revenue Service granted a partnership 120 days from the date of the letter to make an election under §754 of the Internal Revenue Code based on a finding that it acted reasonably and in good faith, and that granting relief would not prejudice the government’s interests.

The requesting partnership intended to make a §754 election for its most recent taxable year. However, the partnership failed to timely file such election with its partnership return for the taxable year.

Section 754 provides, in part, that if a partnership files an election, in accordance with the regulations prescribed by the Secretary, the basis of partnership property is adjusted in the case of a distribution of property, in the manner provided in  § 734, and, in the case of a transfer of a partnership interest, in the manner provided in  § 743. Such an election applies with respect to all distributions of property by the partnership and to all transfers of interests in the partnership during the taxable year with respect to which the election was filed and all subsequent taxable years.

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