This case involves Dolores J. Murphy, as Trustee of the Charles M. Murphy Administrative Trust, seeking a refund of tax penalties and related interest imposed by the IRS for the late filing of the 2016 and 2017 tax returns for the trust, as well as penalties assessed in the 2021 tax year and declaratory relief (Dolores J. Murphy et al. v. United States, US DC ED CA, Case No. 1:24-cv-00260, February 19, 2025). The government moved to dismiss the refund claim related to the 2016 tax year as untimely under Federal Rule of Civil Procedure 12(b)(1) and both the 2016 and 2017 claims under Rule 12(b)(6), asserting that Murphy had not set forth any facts that would constitute reasonable cause for the late filing. The government also sought dismissal of the requests for declaratory relief as statutorily barred and dismissal of the claims related to the 2021 tax year as moot or jurisdictionally barred. The court denied in part and granted in part the government’s motion to dismiss.

In Robert Donlan, Jr. and Kegan Donlan v. Commissioner of Internal Revenue, 164 T.C. No. 3, the U.S. Tax Court addressed the issue of whether a petition filed using the court’s online petition generator, which does not bear a handwritten signature, is considered properly signed under the Tax Court Rules of Practice and Procedure. The Commissioner filed a Motion to Dismiss for Lack of Jurisdiction, arguing that the petition was not properly signed. The Tax Court denied the Commissioner’s motion, holding that a person’s name on a signature block on a paper that the person authorized to be filed electronically constitutes the person’s signature, as per Tax Court Rule 23(a)(3).

Following the stay issued in Smith, et al. v. U.S. Department of the Treasury, et al., 6:24-cv-00336 (E.D. Tex.), beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA) are back in effect.  FinCEN has posted information on the https://www.fincen.gov/boi website and released FIN-2025-CTA1, “FinCEN Extends Beneficial Ownership Information Reporting Deadline by 30 Days; Announces Intention to Revise Reporting Rule” to explain these developments.

In Blum v. Commissioner, TC Memo 2025-18, the Tax Court addressed a dispute concerning the disallowance of a $78.5 million tax shelter loss, penalties, and the validity of notices issued by the IRS. The central issues revolved around the petitioners’ participation in a Bond Linked Issue Premium Structure (BLIPS) tax shelter, the IRS’s notification procedures, and various legal arguments raised by the Blums.

The Cannon Corporation and Subsidiaries ("Cannon") appealed a Tax Court decision that upheld the Commissioner of Internal Revenue’s determination of a tax deficiency for the 2011 tax year. The central issue was whether Cannon, as a designer of energy-efficient buildings, could retroactively report Section 179D deductions for the 2007-2010 tax years on its 2011 tax return as an accounting method change, and whether its equitable estoppel, equitable recoupment, and duty of consistency claims were valid. The Court of Appeals affirmed the Tax Court’s judgment, finding that Cannon could not claim the deductions as an accounting method change and that its equitable claims lacked merit.

Judge Jeremy Kernodle of the US District Court for the Eastern District of Texas has issued a stay of the injunction against enforcement of the Beneficial Ownership Reports required by the Corporate Transparency Act he had previously issued in the case of Smith v. Treasury. He indicates the stay is being issued in light of the Supreme Court’s order in McHenry v. Texas Top Cop Shop, Inc.

The stay order can be downloaded via this link.

This case, Green Valley Investors, LLC v. Commissioner, T.C. Memo. 2025-15, involves a consolidated proceeding of four related cases concerning noncash charitable contribution deductions claimed by four partnerships for tax years 2014 and 2015. The partnerships in these cases are Green Valley Investors, LLC (Green Valley), Big Hill Partners, LLC (Big Hill), Tick Creek Holdings, LLC (Tick Creek), and Vista Hill Investments, LLC (Vista Hill). Bobby A. Branch served as the tax matters partner for each of the partnerships. The partnerships had each claimed charitable contribution deductions for the donation of conservation easements totaling approximately $90 million. The Internal Revenue Service (IRS) disallowed the deductions, asserting that the conservation easement deeds did not comply with the requirements of section 170 of the Internal Revenue Code (IRC), and also assessed accuracy-related penalties.

Here’s a summary of the provisions in each of the four bills that were unanimously approved by the House Ways & Means Committee on February 12, 2025

This revenue procedure, Rev. Proc. 2025-16, provides guidance on depreciation deductions for passenger automobiles placed in service in calendar year 2025, as well as income inclusion amounts for lessees of passenger automobiles with a lease term beginning in 2025. The procedure includes tables that reflect inflation adjustments required by § 280F(d)(7) of the Internal Revenue Code.

The government’s arguments in the Texas Top Cop Shop and Community Associations briefs share many similarities, as both cases involve challenges to the Corporate Transparency Act (CTA) and the government’s defense of its constitutionality. However, there are also some differences in emphasis and approach, likely due to the specific nature of the plaintiffs in each case.

The government’s brief argues for the reversal of the district court’s preliminary injunction against the Corporate Transparency Act (CTA), asserting that the district court erred in its legal conclusions and in granting nationwide relief. The government contends that Congress acted within its enumerated powers when enacting the CTA and that the balance of equities favors the government.

In PLR 202506004 a decedent had left various retirement accounts to a trust which was to transfer first funds to a charity, with any amounts left over to individual beneficiaries via a trustee-to-trustee transfer.  The PLR is looking for rulings on the tax treatment of these transactions.

In Peoplease, LLC v. Commissioner, T.C. Memo. 2025-14, the Tax Court reviewed a determination by the Internal Revenue Service (IRS) Independent Office of Appeals to uphold a proposed levy action against Peoplease, LLC, for unpaid liabilities reported on Form 941, Employer’s Quarterly Federal Tax Return, for the tax period that ended December 31, 2021. The court ultimately granted the IRS’s motion for judgment on the pleadings, finding no abuse of discretion by the Appeals Officer.

The defendants, the United States Department of the Treasury, are requesting a stay of the court’s order granting a preliminary injunction against the enforcement of the Corporate Transparency Act (CTA). The defendants have filed a motion for a stay pending appeal to the Fifth Circuit, arguing that the stay is warranted based on the Supreme Court’s decision to stay a similar injunction in a parallel case, McHenry v. Texas Top Cop Shop.  But the agency is also indicating that changes may come to the CTA reporting requirements before reports would become due if the court grants this motion.

In a legal action concerning the IRS’s handling of Employee Retention Credit (ERC) claims taking place in the U.S. District Court in Arizona, two opposing documents outline significantly different perspectives on the matter. The plaintiffs, Stenson Tamaddon, LLC, and ERC Today, LLC, argue for a preliminary injunction against the IRS, asserting violations of the Administrative Procedure Act (APA) and the Fifth Amendment Due Process Clause. The IRS, in its opposition, contests these claims, defending its procedures and challenging the plaintiffs’ standing and legal arguments.

Chief Counsel Advice 202505027 addresses the validity of extensions to the statute of limitations for partnership adjustments under the Bipartisan Budget Act of 2015 (BBA) audit rules. The memorandum concludes that the extensions in question were invalid because they were not signed by the designated partnership representative (PR) or designated individual (DI) as required by law.

In Clark v. Commissioner, T.C. Memo. 2025-13, the Tax Court addressed whether the taxpayer was liable for self-employment tax and an accuracy-related penalty. The Court resolved both issues in favor of the Commissioner.

In Langlois v. Commissioner, T.C. Memo. 2025-12, the Tax Court addressed a deficiency of $27,820 and an accuracy-related penalty of $5,564 asserted by the IRS against Thomas W. Langlois for the 2015 tax year. The court’s decision hinged on Mr. Langlois’s failure to substantiate deductions for unreimbursed employee business expenses and partnership losses, largely due to inadequate recordkeeping. This case underscores the critical importance of maintaining meticulous records to support tax deductions.

The Fifth Circuit’s recent decision in Balentine v. United States serves as a critical reminder of the "pay first, litigate later" principle that has long governed federal tax refund litigation. This article will delve into the details of the Balentine case, its reliance on the landmark Supreme Court decision Flora v. United States, 362 U.S. 145 (1960), and provide a comprehensive analysis of the issues involved for the benefit of tax professionals.

This private letter ruling (PLR 202505002) addresses the deductibility of medical expenses related to in vitro fertilization (IVF) and gestational surrogacy under Internal Revenue Code Section 213.