lIt ate an end to these abuses leaves honest tax practitioners to convince clients that we are more trustworthy than the reputable real estate firm they have been doing business with for over a decade who tells them their accountant lacks expertise or is too timid.
X. Conclusion CEs serve a good social function and if one believes that the tax code should be used for such purposes other than raising revenue, it is valid and useful. Current law invites abuse because it encourages overvaluation, overwhelms IRS resources to police this weakly structured law, clogs our court system, and encourages disrespect for our tax laws.
Following are 47 unique cases decided by the courts in the past five years dealing with facades and CEs. Most are disallowed in full, though many abate penalties. These are tough cases that only the best tax lawyers undertake to defend.
Frank Agostino of Agostino & Associates PC in Hackensack, New Jersey, tries many easement cases, successfully settling 90 percent without trial. He blames faulty and fraudulent appraisals for the rash of litigation and says controversies could be significantly reduced if penalties were assessed against the appraiser — including government appraisers — when there is more than a 50 percent error in valuation. Competent appraisals, he believes, should not vary by more than 10 percent.
A significant penalty on appraisers for failing a valuation variance standard, together with more objective and consistent standards for CE charities, could drive out the bad actors. Placing major responsibility on appraisers at the start and charities at the end of the transaction might be the self-enforcing mechanism we need to minimize CE disputes.
Report this Published by Lance Wallach Lance Wallach Abusive tax shelters, 419, section 79, 412i micro captive insurance, VEBA, expert witness, author, speaker Published • now
INCOME TAX Notice 2016–66 Notice 2016–66 This notice identifies certain “micro-captive transactions” and substantially similar transactions as transactions of interest for purposes of § 1.6011–4(b)(6) of the Income Tax Regulations and §§ 6111 and 6112 of the Internal Revenue Code. This notice also alerts persons involved in such transactions to certain responsibilities and penalties that may arise from their involvement with these transactions.
lIt ate an end to these abuses leaves honest tax practitioners to convince clients that we are more trustworthy than the reputable real estate firm they have been doing business with for over a decade who tells them their accountant lacks expertise or is too timid.
ReplyDeleteX. Conclusion
CEs serve a good social function and if one believes that the tax code should be used for such purposes other than raising revenue, it is valid and useful. Current law invites abuse because it encourages overvaluation, overwhelms IRS resources to police this weakly structured law, clogs our court system, and encourages disrespect for our tax laws.
Following are 47 unique cases decided by the courts in the past five years dealing with facades and CEs. Most are disallowed in full, though many abate penalties. These are tough cases that only the best tax lawyers undertake to defend.
Frank Agostino of Agostino & Associates PC in Hackensack, New Jersey, tries many easement cases, successfully settling 90 percent without trial. He blames faulty and fraudulent appraisals for the rash of litigation and says controversies could be significantly reduced if penalties were assessed against the appraiser — including government appraisers — when there is more than a 50 percent error in valuation. Competent appraisals, he believes, should not vary by more than 10 percent.
A significant penalty on appraisers for failing a valuation variance standard, together with more objective and consistent standards for CE charities, could drive out the bad actors. Placing major responsibility on appraisers at the start and charities at the end of the transaction might be the self-enforcing mechanism we need to minimize CE disputes.
Report this
Published by
Lance Wallach
Lance Wallach
Abusive tax shelters, 419, section 79, 412i micro captive insurance, VEBA, expert witness, author, speaker
Published • now
INCOME TAX
ReplyDeleteNotice 2016–66 Notice 2016–66
This notice identifies certain “micro-captive transactions” and substantially similar transactions as transactions of interest for purposes of § 1.6011–4(b)(6) of the Income Tax Regulations and §§ 6111 and 6112 of the Internal Revenue Code. This notice also alerts persons involved in such transactions to certain responsibilities and penalties that may arise from their involvement with these transactions.