Kulzer & DiPadova, P.A.
76 E. Euclid Avenue, Suite 300
Haddonfield, New Jersey 08033-2342

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News, Articles & Resources

Category: Tax Controversies

Tax Court reminder – IRS levies on IRA accounts are taxable

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  The United States Tax Court recently issued a Memorandum opinion reminding taxpayers that when the Internal Revenue Service (IRS) seizes an Individual Retirement Account (IRA), the seized IRA needs to be included as taxable income.  Lonnie Wayne Hubbard v. Commissioner of Internal Revenue (T.C. Memo. 2024-16). In 2017, disgraced…

New Priority Guidance Plan Announced For Limited Partner Exception to SECA

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NEW PRIORITY GUIDANCE PLAN ANNOUNCED FOR LIMITED PARTNER EXCEPTION TO SECA   For a number of years there has been an ongoing challenge by the IRS of taxpayers claiming limited partner status and exemption from the Self-Employment Contributions Act (SECA) tax. The activity in this area has greatly increased in…

Company Owned Life Insurance and Buy-Sell Agreements

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In Connelly v. U.S., USDC ED MO, Case No. 4:19-c-01410, September 21, 2021, the District Court for the Eastern District of Missouri held that company-owned life insurance on the life of a deceased shareholder that was used to redeem the deceased shareholder’s shares increased the fair market value of the…

Split Among Federal Circuit Courts on the Application of the “Non-Willful” FBAR Penalty

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Any individual that has direct ownership, signatory authority or beneficial ownership over a foreign bank account that has a balance of $10,000 during any point of the year is required to file a Report of Foreign Bank and Financial Accounts (“FBAR”).  The penalties for failing to file an FBAR can…

Could dramatic estate tax changes be looming?

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As was reported in our newsletter dated September 16, 2021, House Ways and Means Democrats Proposed Changes (link), the Ways and Means Committee of the United States House of Representatives (the principal tax writing committee) recently proposed substantial tax changes.  Several of the provisions in the bill could have a…

Tax Advisors May Now Sue IRS

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In CIC Services LLC v. Internal Revenue Service decided in May 2021, the United States Supreme Court held the Anti-Injunction Act (AIA), section 7421(a) of the Internal Revenue Code (Code), does not preclude a pre-enforcement challenge to an IRS notice enforced through civil and criminal penalties. The AIA generally precludes…

IRS adds question on 1040 about cryptocurrency, but causes potential confusion

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On the first page of the Form 1040 for 2020, right under the taxpayers’ personal information but before any financial information is reported, the IRS has added the following question: “At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual…

COVID-19 Outbreak Tax Developments

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  Treasury and IRS Issue Guidance on Tax-Paying and Tax-Filing Due to COVID-19 Outbreak On March 13, 2020, President Trump issued an emergency declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act in response to the ongoing Coronavirus Disease 2019 (COVID-19) pandemic (“Emergency Declaration”). The Emergency Declaration…

Despite Late Filing New Jersey District Court Abates $450,959.50 Late Filing Penalty

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In the just decided case of the Estate of Agnes R. Skeba v. United States; No. 3:170-cv-10231, the New Jersey District Court abated a $450,959.50 late filing penalty even though the federal estate tax return was filed nine months late. On March 10, 2014, the due date for the estate…

Taxpayer Wins Major Gift Tax Valuation Case

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Mr. Jones established three trusts for his daughters in May 2009.  He gifted voting and non-voting stock of Seneca Sawmill Co. (“SSC”) and limited partnership interest of Seneca Jones Timber Co. (“SJTC”) to the trusts.  Together these entities operated a lumber and timber business.  Mr. Jones filed a gift tax…

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