Tax

he Court of Appeals for the District of Columbia on Dec. 22, 2006, vacated its judgment from four months earlier in Murphy, Marrita v. IRS in which the court held that a lawsuit award for emotional distress was not taxable. The government had petitioned for an en banc hearing. Instead,

lthough in the past the government won a number of important victories in its ongoing attempt to stop abusive tax transactions, it has continued to lose on contingent liability transactions. Recently, however, the Court of Appeals for the Federal Circuit reversed a lower court decision that may substantially affect future

he Eighth Circuit Court of Appeals held that courts can review an IRS decision to reject a taxpayer’s offer in compromise. Ronald Speltz exercised incentive stock options to buy shares of McLeod Network Service worth $745,372 for $34,254. Speltz incurred a $224,869 alternative minimum tax (AMT) liability when the shares

he Eighth Circuit Court of Appeals affirmed the Tax Court’s decision that when a cooperative makes “value-added” payments to its members and allows them to defer the cash receipts, such payments do not constitute a deferral for tax purposes. In a case argued before the Eighth Circuit, a cooperative had

TAX CASE he courts have uniformly held that generally accepted accounting principles (GAAP) are not determinative of tax rules. Whether a taxpayer recognized income for financial statement purposes is irrelevant in deciding whether he or she must report the income on a tax return. The Ninth Circuit Court of Appeals

TAX CASE ny cash or noncash remuneration received for employment, unless specifically exempt, is considered wages subject to the FICA tax. FICA wages can include amounts received by the employee after the employment relationship has ended. For example, the courts have held that awards for back pay and future pay

TAX CASE RC section 6511(a) generally requires taxpayers to file a refund claim for a tax overpayment within three years from the time the return was filed or within two years from the time the tax was paid, whichever period expires later. If no return was filed, the two-year period