Taxation & Wealth Planning

Tax Controversy & Litigation


Tax Controversy & Financial Crimes Report

The increasingly complex area of tax law in the U.S. can cause a variety of legal setbacks for any business. The more notable the tax controversy, the more roadblocks that can be created between a company and its success. Our Tax Controversy & Financial Crimes Report blog addresses the latest developments in all aspects of tax controversy matters and incorporates coverage of efforts to combat financial crimes, particularly money laundering.

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Recent Blog Posts

  • IRS Restricts Levy Actions Involving EIP or PPP Funds In recognition of the continuing economic hardship caused by the COVID-19 pandemic, the Internal Revenue Service is easing its collection activities to avoid the seizure of bank accounts containing either Economic Impact Payments or Paycheck Protection Program loan proceeds. In a guidance memorandum issued to all collection employees, the IRS has directed that before issuing a levy, employees should contact the taxpayer in question to determine if it received a PPP loan, and if so, where the funds were deposited.  Employees... More
  • Civil Settlement in PPP Loan Fraud Case Opens New Battle Lines The U.S. Justice Department announced its first civil settlement with a Paycheck Protection Program borrower alleged to have committed fraud in connection with this highly popular COVID-19 relief program. A bankruptcy online retailer and its chief executive officer agreed to pay $100,000 in damages and penalties to resolve claims that they committed fraud in connection with multiple PPP loan applications. The company, SlideBelts Inc., also agreed to repay its PPP loan in full. The Paycheck Protection Program is one of the signature provisions... More
  • Fox Rothschild’s Fourth Annual Federal Tax Controversy Summit On January 12, 2021, please join members of Fox’s Tax Controversy team for a review of recent developments in federal tax controversy and civil and criminal tax enforcement, as well as a look ahead at what 2021 may hold.  Matthew D. Lee, Jerald David August and Vivian Hoard will review recent developments in federal tax controversy with a focus on the following topics: Developments in IRS enforcement regarding conservation easements Latest updates and guidance regarding centralized partnership audit rules Federal tax enforcement in the age of... More
  • Congress Enhances Significant Tax Breaks for Businesses in Consolidated Appropriations Act By Maureen Monaghan and Adam Young  The Consolidated Appropriations Act, 2021 (Act), signed into law on December 27, 2020, amends certain tax provisions of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and the Families First Coronavirus Response Act (FFCRA). It also clarifies the tax treatment of Paycheck Protection Program (PPP) loan forgiveness, extends certain deferred payroll taxes and expands the deduction for business meals, among other provisions. While the Act is helpful in extending and expanding current tax benefits,... More
  • For Existing PPP Borrowers, Stimulus Bill Expands Forgivable Uses and Eases Tax Consequences By Gabriel B. Herman The $900 billion Consolidated Appropriations Act of 2021 (the Act) modifies the Paycheck Protection Program (PPP) in a variety of business-friendly ways likely to benefit both existing PPP borrowers and businesses that receive a second PPP Loan. Specifically, the Act includes the following noteworthy changes: Uses Eligible for Forgiveness The Act expands on the types of expenses that PPP borrowers may use their proceeds to pay and later seek forgiveness. Notably, these changes apply to existing borrowers that have not... More
  • PPP Data Dump Places Loan Forgiveness Applications Under a Microscope By Matthew D. Lee and Marissa Koblitz Kingman This month’s court-ordered release of Paycheck Protection Program (PPP) loan data is expected to result in intense scrutiny of the loan forgiveness process, highlighting the need for recipients to proceed with caution when filing forgiveness applications. Multiple news organization sued the Trump administration in May demanding that it release information on the businesses that benefited from federal pandemic relief programs. A federal judge ordered the administration to disclose the information and on the evening of December... More
  • Stimulus Package Expands PPP, Simplifies Loan Forgiveness and Adds Disaster Grants By Paul B. Edelberg, Elizabeth J. Hampton and Gabriel B. Herman In its massive new pandemic relief and stimulus package, Congress has significantly modified the Paycheck Protection Program (PPP) to allow for second draws from the program, to simplify the loan forgiveness process, to provide restaurants access to greater relief and to extend the program through March 2021. The proposed law also includes economic disaster grants and debt relief provisions, as well as bolstering the Small Business Administration’s existing Microloan Program. The Coronavirus... More
  • Key Steps the Pharma and Bioscience Sectors Must Take Ahead of Federal Scrutiny of COVID-19 Relief Funding November 23, 2020 – Alerts By Ernest E. Badway An unprecedented explosion of government investigation and enforcement is at hand as federal regulators focus their efforts on ferreting out any fraud or abuse of the $1 trillion in COVID-19 relief funding programs through loans, grants and tax credits. For pharma and bioscience companies, it is imperative to take steps now to limit the risks and consequences of such investigations. Regulatory threats to these companies may be forestalled by quick action to preserve evidence and correct... More
  • Partnerships and S Corporations Exempted From Limits on State and Local Tax Deduction November 16, 2020 – Alerts  By Eric J. Michaels and Adam R. Young The IRS intends to issue proposed regulations to permit a partnership or an S corporation to deduct specified income tax payments made to a domestic state or local jurisdiction. In Notice 2020-75, the IRS clarifies that state and local income taxes imposed on and paid by a partnership or S corporation with respect to its income are allowed as a deduction by the partnership or S corporation in computing its non-separately stated taxable... More
  • SBA Announces New Paycheck Protection Program Loan Necessity Questionnaire By Paul B. Edelberg On October 26, the Small Business Administration (SBA) published a notice in the Federal Register seeking approval from the Office of Management and Budget to release two new forms to be sent to borrowers under the Paycheck Protection Program (PPP) in preparation for audits by the agency. Because these audits have significant legal implications for borrowers such as disqualification and potential civil and criminal liability, entities that obtained PPP loans should consult counsel and exercise great care in answering... More