A closer look.
IRS Insights, published by the Deloitte Tax LLP Tax Controversy Services group, provides a compact, reader-friendly perspective on the latest practices and procedures coming out of the Internal Revenue Service (IRS), as well as the potential impact of changes on taxpayers.
- Changes Made to Partnership Audits and Adjustments: The Bipartisan Budget Act of 2015 included significant rule changes that affect all aspects of partnership audits and adjustments.
- Second Circuit Reverses District Court and Holds that Attorney-Client Privilege Was Not Waived By the Sharing of Documents with Parties Having a Common Legal Interest: In a recent decision, the Second Circuit reversed the decision of the District Court and held that the sharing of documents with third parties did not waive the attorney-client privilege because the third parties were engaged in a common legal interest with the taxpayer. Additionally, the Second Circuit examined the requirements for the work product doctrine, and again reversed the District Court in finding that that the work-product doctrine applied to and protected the documents at issue.
- The IRS Continues to Release International Practice Units: In December 2014, the IRS released a number of Large Business & International (“LB&I”) International Practice Units (“IPUs”). During 2015, the IRS released an additional 42 IPUs covering a wide range of international topics.
- IRS Launches Early Interaction Initiative to Help Employers Meet Their Payroll Tax Obligations: In December 2015, the IRS announced the Early Interaction Initiative, which is designed to identify employers that are falling behind on their payroll or employment tax and then assist them in complying with their payment and reporting responsibilities. The Early Interaction Initiative is consistent with the Large Business & International division’s recent focus on designing and deploying campaigns to enable the IRS to both identify specific compliance risks using data analytics and develop tailored treatments to address the identified compliance issues.
Tax Court Invalidates Transfer Pricing Regulations, Finding That They Did Not Satisfy the Reasoned Decisionmaking Standard under “State Farm”
The Federal Circuit Affirms a Court of Federal Claims Decision Dismissing Foreign Tax Credit Refund Claims as Untimely
A District Court Holds IRS’s Assessment of a Reportable Transaction Penalty was Untimely under Section 6501(c)(10) as IRS Had Been Furnished the Required Information More Than One Year before Assessment
The Tax Court Holds that Raising the Reasonable Cause and Good Faith Defense to the Accuracy-Related Penalty May Cause a Waiver of Privilege
The Tax Court’s Recent Determination That a Taxpayer Did Not Meet the Three-Factor Test for Informal Refund Claims and a Review of Cases in Which Courts Have Treated a Refund Request Made on an Incorrect Form as an Informal Refund Claim