The case of Saenz v. Commissioner, TC Summary Opinion 2015-6, turned on whether Leticia Saenz’s daughter, who filed a joint return for 2011, was actually married to the person she filed a joint return with.

The Eleventh Circuit Court of Appeals took a look at what constitutes research funded by a third party in the case of Geosyntec Consultants, Inc. v. United States, CA 11, 115 AFTR 2d ¶ 2015-384. 

In Action on Decision 2015-01 the IRS announced that it will not follow the Tax Court’s decision in four cases that were decided on the same day in 2004 that involved the interaction of the bankruptcy code and taxation of partners on cancellation of debt income.

When a LLC “checks the box” by filing a Form 2553 to elect to be treated as a corporation and simultaneously elect S status, it must live by all the S corporation restrictions.  That includes the restriction on only having one class of “stock” issued by the entity during the time it wishes to remain an S corporation.

In reality, there is no such federal tax entity as an “LLC”—the structure was originally designed when the first statute was adopted by Wyoming decades ago to be an entity for which there was no federal tax treatment specifically mandated.  To this day the IRC does not have provisions outlining the tax treatment of “LLCs” but rather, under the check the box regulations found at Reg. §301.7701‑2 the entity is treated for federal tax purposes as one of the entities that the IRC knows about.

The concept of “placed in service” for purposes of beginning to deduct depreciation is often a tricky one to deal with in real life, and the date of placing an item in service may not be as simple as some might believe.  Certainly, in the case of Stine, LLC v. United States, 115 AFTR 2d ¶ 2015-381, DC LA, the IRS’s view of a “bright line” test based on a when a building was open for business was rejected by the Court.

In order to qualify for “real estate professional” status for the taxpayer’s rental properties, the taxpayer must meet certain participation requirements in a real estate trade or business.

In the case of Perez v. Commissioner, 144 TC No. 4, the Tax Court took care immediately upon starting the opinion section by explaining what it wasn’t deciding, a somewhat unusual step.  But, then again, this was a somewhat unusual case.

The issue in this case was whether Nichelle Perez had taxable income for payment she received for undergoing procedures to donate her eggs to infertile couples. 

As Neil Sadaka crooned, breaking up is hard to do.  And it certainly proved so for an accounting firm.  The acrimonious breakup did result in a tax case, this time looking at liability for filing a false information return under IRC §7434.

The Sixth Circuit court of appeals was called by both parties to review decisions of the U.S. District Court in the case of Pitcher and Enders v. Waldman, et al, CA6, Case Nos. 14-3369/14-3392, on appeal from the U.S District Court for the Southern District of Ohio.

The turtle is not often referred to in tax discussions, but the Tax Court compared the taxpayer to a turtle in rendering its decision in the case of Jacobs v. Commissioner, TC Summary Opinion 2015-3.

Mistakes happen, but in this case the IRS allowed a tax advisers a “get of jail (not quite) free” card with regard to giving bad advice to a client due to an error in computing the taxpayer’s taxable income when preparing a return.  In PLR 201503005 the IRS granted the taxpayer the right to revoke an election out of the installment basis of accounting.