Justia Tax Law Opinion Summaries

Section 6511(d)(3)(A) of the Internal Revenue Code, which establishes an elongated ten-year limitations period on refund claims resulting from foreign tax credits, was applicable only to overpayments attributable to foreign taxes for which the taxpayer elects to claim, but was not applicable to claims resulting from deductions for foreign taxes paid or accrued. The Second Circuit affirmed the district court's denial of taxpayer's claim for a deduction of foreign taxes under section 6511(d)(3)(A), holding that taxpayer's refund claim was time-barred. In this case, taxpayer's claim for refund was filed in December 2011 for an overpayment of taxes in 1995, that was attributable to its election to deduct foreign taxes paid in 2002. View "Trusted Media Brands, Inc. v. United States" on Justia Law

Larson was involved with—and later convicted of crimes related to—the organization of fraudulent tax shelters. The IRS then required organizers/promoters to register tax shelters not later than the day of the first offering for sale, 26 U.S.C. 6111(a). Organizers/promoters who failed to register were subject to a penalty of the greater of one percent of the aggregate amount invested in the tax shelter, or $500. Eight years after the IRS notified Larson that he was under investigation, it informed him that it considered him an organizer with a duty to register and was subject to penalties of $160,232,0261 for failure to do so. The IRS Office of Appeals reduced the penalties to $67,661,349, stating that Larson would need to pay the remaining penalty and file a Claim for Refund if he wanted to contest the assessment. Larson paid $1,432,735 and filed his Refund Claim. The IRS rejected Larson’s claim for failure to pay the entire amount. Larson filed suit. The government moved to dismiss, arguing that because Larson had not paid the assessed penalties in full, the court lacked jurisdiction. The court agreed, concluding that application of the full-payment rule did not violate Larson’s due process rights. The Second Circuit affirmed, holding that the full‐payment rule applies to Larson’s section 6707 penalties and that his tax refund, due process, Administrative Procedure Act, and Eighth Amendment claims were properly dismissed. View "Larson v. United States" on Justia Law

The Second Circuit affirmed the district court's dismissal of a petition for innocent spouse relief based on lack of jurisdiction and from an order denying petitioner's motion to vacate the order of dismissal. The court held that petitioner's failure to file the petition within the statutorily prescribed period deprived the Tax Court of jurisdiction to review her claim. View "Matuszak v. Commissioner of Internal Revenue" on Justia Law