IRS APPEALS

When a satisfactory resolution has not been reached at the end of an IRS audit, Colvin + Hallett’s attorneys can assist clients with appeals whether or not they represented the client during the audit. Colvin + Hallett’s attorneys will thoroughly delve into and examine the facts and law of a client’s case to develop the legal theories and supporting evidence needed for the appeal. We will negotiate with the appeals officer to work toward a favorable resolution settlement, including where warranted, a full concession by the IRS.

IRS Appeals

Represented a large partnership of technology companies in a case involving the IRS’s proposed $250 million adjustment relating to the amortization of patents; the IRS conceded entirely at Appeals.

Secured a full concession at Appeals for the owner of a sports team where the IRS had asserted that $100 million is losses should be disallowed because the team was a hobby and not a business.

Represented an investor who participated in multiple variable prepaid forward contracts involving over $120 million that the IRS challenged on the grounds that the sale occurred at the time the contract was executed rather than at the contract’s end. Successfully persuaded Appeals to depart from its prior settlement posture of 80% concession by taxpayer and instead obtained an 80% IRS concession.

Obtained a $7 million refund for a homebuilder with operations in multiple states in an appeal of an IRS determination that financing arrangements were a circular flow of money and should not be respected, successfully defending client’s plan to shift basis to alternate entity.

Secured full concession at IRS Appeals that homebuilder’s land-holding entities were entitled to capital gain treatment on the sale of land to the homebuilder’s development entity.

Secured full concession by IRS that bonus payments made by corporation were deductible compensation, not non-deductible dividends even though they were made, in part, in proportion to stock ownership.

Successfully argued that the $2 million of gains from client’s commodities broker-dealer who created sham transactions to generate losses for other clients, assigning the gain to our client, were shams and not taxable, plus later obtained theft loss deduction for client.

Obtained favorable settlements at Appeals for clients around the U.S. where the IRS sought to include in the clients’ income the cash value of life insurance policies purchased by their employers.

In estate tax case involving value of stock of publicly traded closely held business, favorably resolved valuation dispute resulting in a savings of more than $8 million from the IRS’s asserted position.

Successfully defended at Appeals an IRS challenge to a $1.7 million theft loss deduction for money lost to a Nigerian internet scheme.

Represented tribal tobacco stores where the IRS challenged a deduction for over $1.5 million in cash and goods seized in a raid by the federal government. Obtained a favorable result at Appeals—the liability was less than 2% of the amount proposed by the IRS.

Obtained an $800,000 casualty loss for a client whose pool and property was damaged as a result of a sinkhole; IRS argued it did not qualify for casualty loss treatment and challenged the amount of the loss.

IRS Preparer Audits & Promoter Penalty Investigations
Colvin + Hallett attorneys understand the seriousness and potential consequences to preparers when the IRS is examining them and the returns they have prepared.  Our lawyers are frequently trusted by other tax professionals to skillfully represent them in IRS audits and investigations, and advocate on their behalves for favorable resolutions.  

CASE STUDIES

In audit of tax return preparer, persuaded the IRS that proposed audit of 30 clients under a preparer penalty project was unjustified and should not be pursued after conducting an audit of just three clients.

Convinced the IRS that preparer’s treatment of complex transaction was proper and not subject to penalty, saving a potential audit of a thousand or more clients.

Defended tax return preparer in connection with IRS preparer penalty assertion; Appeals conceded the penalty.

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