The United States Tax Court’s decision in Estate of Billy S. Rowland, Deceased, James A. Park, Executor v. Commissioner of Internal Revenue, T.C. Memo. 2025-76, provides critical insights for tax professionals concerning the deceased spousal unused exclusion (DSUE) amount and the stringent requirements for electing portability. This case underscores the importance of strict compliance with filing deadlines and return preparation standards, even when attempting to utilize administrative safe harbors.

The recent decision in Rock Cliff Reserve, LLC v. Commissioner, T.C. Memo. 2025-73, offers crucial insights for tax professionals navigating the complexities of conservation easement deductions and related penalties. This memorandum opinion addresses consolidated cases involving four partnerships—Rock Cliff Reserve, LLC (Rock Cliff PropertyCo), Jack’s Creek Reserve, LLC (Jack’s Creek PropertyCo), East Village Reserve, LLC (East Village PropertyCo), and Baker’s Farm Nature Reserve, LLC (Baker’s Farm PropertyCo), collectively referred to as the PropertyCos. Five Rivers Conservation Group, LLC (Five Rivers), served as the tax matters partner for each. The case scrutinizes charitable contribution deductions claimed for conservation easements, totaling over $62 million, along with "Other Deductions" claimed in Walton County, Georgia, for the 2015 tax year.

Tax professionals who advise tax-exempt organizations are aware of the stringent rules governing political activity, particularly for entities described under Internal Revenue Code (IRC) Section 501(c)(3). A significant legal development is currently under consideration by the United States District Court for the Eastern District of Texas: a proposed consent judgment in the case of National Religious Broadcasters, et al. v. Billy Long, et al., which addresses the interpretation of the "Johnson Amendment" as it applies to churches. This proposed agreement, while not yet binding, offers crucial insights into the ongoing dialogue surrounding religious organizations' political speech and their tax-exempt status.

For experienced tax professionals, understanding the mechanisms for tax relief during unforeseen events is paramount. Internal Revenue Code (IRC) Section 7508A currently provides the Secretary of the Treasury with broad authority to postpone certain tax-related deadlines due to specific types of disasters and actions. However, a recently passed bill, the "Filing Relief for Natural Disasters Act" (H.R. 517), passed by both the House and the Senate, aims to significantly expand the scope and duration of this relief. This article details the existing provisions of Section 7508A and illuminates the key modifications this bill would introduce if enacted.  The bill was awaiting the President’s signature at the time this article was written.

Tax professionals understand that jurisdiction is a foundational element for any case brought before the United States Tax Court. As a court of limited jurisdiction, the Tax Court may only exercise authority granted by Congress. A recent memorandum opinion, Donna Davis v. Commissioner, T.C. Memo. 2025-72, offers a critical reminder of the stringent requirements for establishing jurisdiction, particularly concerning the validity of a Notice of Deficiency and the timely filing of a petition. This case underscores the importance of adherence to procedural rules, even in the face of sympathetic circumstances.

For tax professionals navigating complex compensation and wealth transfer arrangements, the Sixth Circuit’s recent decision in Peter E. McGowan; Michele L. McGowan; Peter E. McGowan DDS, Inc. v. United States of America, No. 24-3228 (July 9, 2025), offers crucial insights into the application of split-dollar life insurance regulations and the deductibility of related employer contributions. This case affirms the district court’s award of summary judgment to the government, largely upholding the IRS’s assessments against both Dr. Peter E. McGowan and his dental practice, Peter E. McGowan DDS, Inc. (the "Company").

The United States Tax Court’s recent memorandum opinion in Arden Row Assets, LLC v. Commissioner, T.C. Memo. 2025-71, offers critical insights for tax professionals navigating settlement discussions, particularly in the context of syndicated conservation easement transactions and the Bipartisan Budget Act of 2015 (BBA) partnership audit rules. This case underscores fundamental principles of contract law applied to tax settlement agreements, emphasizing the importance of clear mutual assent, adherence to prescribed acceptance methods, and proper authority under the BBA.

The recent Tax Court Memorandum in Remus Beleiu and Naomi J. Beleiu v. Commissioner of Internal Revenue, T.C. Memo. 2025-70, offers crucial insights for tax professionals concerning the imposition of civil fraud penalties under Internal Revenue Code (I.R.C.) Section 6663(a). This case highlights the rigorous standard applied by the Commissioner and the Tax Court in establishing fraudulent intent, particularly when a taxpayer possesses a strong financial and accounting background.

The recent Tax Court decision in Moxon Corporation v. Commissioner, 165 T.C. No. 2 (Filed July 2, 2025), provides critical insights for tax professionals concerning the assessment and collectibility of partnership-level penalties, particularly when underlying tax deficiencies are abated due to procedural errors. This case clarifies the distinct treatment of partnership-level penalties under deficiency procedures and the calculation of "underpayment" for penalty purposes, even in the absence of a collectible tax liability.

In a significant decision for tax professionals navigating Bipartisan Budget Act (BBA) partnership audit procedures, the United States Tax Court in JM Assets, LP v. Commissioner, 165 T.C. No. 1 (2025), delivered a ruling that clarifies the statute of limitations for final partnership adjustments, particularly when a partnership requests modification of an imputed underpayment. This opinion, penned by Judge Buch, underscores the judiciary’s role in ensuring administrative regulations adhere strictly to statutory text, drawing on recent Supreme Court precedent.

As Certified Public Accountants specializing in tax and Enrolled Agents (EA), our role extends beyond mere preparation of returns; it encompasses a rigorous adherence to professional standards set forth by the Internal Revenue Service (IRS). A critical area demanding our expertise and diligence is the Report of Foreign Bank and Financial Accounts (FBAR), FinCEN Report 114. While not a tax return itself, the FBAR is inextricably linked to U.S. tax compliance and is a significant focus of the IRS Office of Professional Responsibility (OPR). This article delves into the FBAR reporting requirements and the specific obligations imposed on practitioners by Circular 230, which governs practice before the IRS as outlined in “Tax Practice Obligations and the Report of Foreign Bank and Financial Accounts,” Alerts from Office of Professional Responsibility, Issue Number: 2025-10.

In a recent Tax Court memorandum, Anaheim Arena Management, LLC v Commissioner, T.C. Memo. 2025-68, the court delved into the complex issue of whether intercompany advances constituted bona fide debt for tax purposes, thereby determining the validity of a significant bad-debt deduction and the applicability of an accuracy-related penalty. This case offers critical insights for tax professionals navigating the often-ambiguous line between debt and equity, particularly in related-party transactions and intricate management agreements.

The court case of American Lighting Company, Inc. v. United States of America had to be filed on June 25, 2025, because it was critically close to the two-year statute of limitations for filing a tax refund suit, given the IRS’s refund claim denial date of June 26, 2023. The complaint itself explicitly states it was "Respectfully submitted, this the 25th day of June, 2025". This timing means the lawsuit was filed just one day before the two-year period from the denial date would have expired.

The reason for this precise timing and why the IRS’s lack of action put the taxpayer at risk is due to specific procedural rules governing tax refund suits and the unusual handling of Employee Retention Credit (ERC) disallowances by the IRS.

As tax professionals, understanding the intricacies of the Trust Fund Recovery Penalty (TFRP) under 26 U.S.C. § 6672 is crucial, particularly when advising clients who hold significant corporate roles. A recent case, Warnement v. The United States, heard in the United States Court of Federal Claims, offers valuable insights into the court’s analysis of the "responsible person" and "willfulness" elements, providing a granular look at the burden of proof in tax controversies.

The "National Taxpayer Advocate’s Fiscal Year 2026 Objectives Report to Congress" is a statutory report submitted annually by the National Taxpayer Advocate to Congress, outlining the objectives for the upcoming fiscal year. This report also includes an analysis of the recently completed 2025 tax filing season to provide context regarding the IRS’s performance and taxpayer challenges, which then informs the systemic advocacy and research objectives for the fiscal year 2026.

The Internal Revenue Service (IRS) has issued significant revisions to the filing exceptions for Schedules K-2 (Partners’ Distributive Share Items—International) and K-3 (Partner’s Share of Income, Deductions, Credits, etc.—International) for both Form 1065 (U.S. Return of Partnership Income) and Form 1120-S (U.S. Income Tax Return for an S Corporation) for tax year 2024. These changes aim to expand the applicability of certain domestic filing exceptions and introduce new small entity exceptions, potentially reducing compliance burdens for many entities. A thorough understanding of these updated requirements is crucial for practitioners navigating the international tax landscape for pass-through entities.

These changes are outlined on the following IRS web pages:

• Form 1065, Schedules K-2 and K-3 filing requirements

• Form 1120-S, Schedules K-2 and K-3 filing requirements

A recent decision from the United States District Court for the District of Arizona in Stenson Tamaddon LLC v. United States Internal Revenue Service, et al. (Case No. CV-24-01123-PHX-SPL) provides critical insights for tax practitioners regarding the Internal Revenue Service’s (IRS) guidance on the Employee Retention Credit (ERC) program. This case addresses a multifaceted challenge to the IRS’s "Notice 2021-20," a 102-page question-and-answer document providing guidance on the ERC. The plaintiff, Stenson Tamaddon LLC (StenTam), a tax advisory firm specializing in ERC claims, contended that this Notice constituted improper legislative rulemaking, bypassing the Administrative Procedure Act’s (APA) notice-and-comment requirements, and was arbitrary, capricious, or beyond the IRS’s statutory authority. The Court, in its ruling on cross-motions for summary judgment, ultimately sided with the government, affirming the IRS’s authority to issue such interpretive guidance without formal rulemaking procedures.

The recent T.C. Memo. 2025-65, Luis Carlos Ibarra Cano v. Commissioner, provides a critical reminder of the Internal Revenue Service’s (IRS) burden in establishing a valid notice of deficiency, particularly when address errors are present. This case highlights the nuanced application of the "last known address" rule and the "harmless error" doctrine.

The recent decision in AbbVie Inc. and Subsidiaries v. Commissioner, 164 T.C. No. 10 (2025), provides critical guidance for tax professionals regarding the application of Internal Revenue Code (I.R.C.) § 1234A, specifically concerning the characterization of termination fees as ordinary deductions or capital losses. This case clarifies the often-debated phrase "right or obligation . . . with respect to property" within § 1234A(1) and its implications for complex corporate transactions.

Tax professionals encounter cases involving collection due process (CDP) and the Internal Revenue Service’s (IRS) determination to uphold collection actions. A recent Tax Court memorandum, Schwartz v. Commissioner, T.C. Memo. 2025-64, provides valuable insights into the criteria the IRS Independent Office of Appeals (Appeals Office) considers when evaluating collection alternatives, particularly installment agreements, and the Tax Court’s standard of review for such determinations. This article will delve into the facts, the taxpayer’s request, the court’s legal analysis, and its application to the specific circumstances, concluding with the implications for tax professionals.