Tax News

CCH (cch.taxgroup.com) reports:

  The California Franchise Tax Board (FT is hosting an interested parties meeting to discuss a proposed 2008 California Schedule M-3 for corporations, partnerships, and limited liability companies. The FTB will have a link to the draft schedule and instructions available on its Web site at
http://www.ftb.ca.gov/ by August 1, 2008, for review and comment.

  The meeting will be held at the FTB in the Golden State Rooms A and B at 9646 Butterfield Way, Sacramento, California. People interested in attending the meeting should contact Penny Celiz at (916) 845-6964 or Penny.Celiz @ftb.ca.gov by August 6, 2008. To participate by telephone dial in at (877) 923-3149 and use the participant code 2233420.

  Subscribers to the CCH Tax Research NetWork can view the announcement.

Announcement , California Franchise Tax Board, August 24, 2008.
 

CCH (cch.taxgroup.com) reports:

  A petition seeking redetermination of a couple's tax deficiency was dismissed for lack of jurisdiction because it was filed after the 90-day filing period had elapsed. The envelope containing the taxpayers' petition was postmarked four days after the end of the filing period. Furthermore, the petitioners had altered the copy of the notice of deficiency that was attached to the petition as an exhibit by changing the date of issuance and the stated "Last Date to Petition Tax Court "so that it appeared that the petition was timely filed. The IRS pointed out the alteration in its motion to dismiss, and the taxpayers did not address the issue despite multiple invitations and orders from the court. A $1,500 penalty was imposed under Code Sec. 6673(a) because merely dismissing the petition would have reward the taxpayers' dishonesty by allowing them to delay payment during the course of the proceedings without penalty.

C. Samaniego, TC Memo 2008-175, Dec. 57,495(M)

Other References:

 
Code Sec. 6213

  CCH Reference - 2008FED ¶37,549.355

 
Code Sec. 6673

  CCH Reference - 2008FED ¶39,790.22

  Tax Research Consultant

  CCH Reference - TRC LITIG: 6,200
CCH Reference -
TRC LITIG: 6,816
 

CCH (cch.taxgroup.com) reports:

  Senate Finance Committee Chairman Max Baucus, D-Mont., on July 24 pushed a panel of witnesses on the findings of a Government Accountability Office (GAO) investigation of the Ugland House, a tax haven in the Cayman Islands. Baucus said the problem might require financial firms to file information reports to the IRS when they facilitate transfers of client funds offshore as a method of enabling the IRS to better track tax evaders by matching that report with filed returns. "I think requiring individuals and companies to be more forthcoming about their offshore holdings in places like the Caymans will go a long way, "said Baucus.

  The Finance Committee also sought input on six legislative recommendations, including modifying the rules for the Foreign Bank Account Report (FBAR), which facilitates information collection by the IRS. The proposals would reinforce the role of the IRS in levying penalties against individuals who fail to file an FBAR, increase the statute of limitations for FBAR violations, require that FBARs be filed with tax returns and strengthen rules on the disclosure of the identity of individuals who make money from offshore financial transactions. Witnesses agreed that the proposals would make strides in beginning to solve the problem of offshore tax evasion.

  Other recommendations from the witnesses included revising current IRS Form W-8 procedures, which allow US taxpayers to hide behind foreign shell corporations to protect individual identities, to require foreign companies to prove they are an active trade or business.

  By Jeff Carlson, CCH News Staff

SFC Release: Hearing Statement of Senator Max Baucus (D-Mont.) Regarding The Cayman Islands and Offshore Tax Issues

SFC Release: Baucus Tackles Tax Evasion In Hearing On Cayman Islands' Ugland House

JCT Selected Issues Relating to Tax Compliance with Respect to Offshore Accounts and Entities, JCX-65-08

GAO Report: Cayman Islands --Business and Tax Advantages Attract U.S. Persons and Enforcement Challenges Exist (GAO-08-778)

GAO E-Supplement: Cayman Islands --Review of Cayman Islands and U.S. Laws Applicable to U.S. Persons' Financial Activity in the Cayman Islands, (GAO-08-1028SP)

GAO Testimony: Cayman Islands --Business Advantages and Tax Minimization Attract U.S. Persons and Enforcement Challenges Exist (08-779T)

Tax Analysts report: