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Articles & Seminar Materials
- June 5 NYS Tax Litigation Seminar: Completion Certificate June 2, 2025
- June 5 NYS Tax Litigation Seminar — Outline May 31, 2025
- June 5 Tax Litigation Seminar — Supplementary Materials May 14, 2025
- June 5 CPE Seminar: NYS Tax Litigation — Practice & Procedure April 28, 2025
- March 13 CPE Seminar: Supplementary Materials March 4, 2025
- Income Taxation of New York Trusts & 2025 Planning Strategies March 4, 2025
- Webinar Recording of 1031 Final Regulations Seminar January 16, 2025
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- Defeating The Right of Election in EPTL § 5-1.1-A
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- Challenging The Account of a Fiduciary
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Author Archives: David L. Silverman, J.D., LL.M. (Taxation)
IRS Collections: Defensive Measures
A taxpayer facing IRS collection should initially determine whether the assessment was timely or whether the 10-year collection period will soon expire. Collections may not proceed if the statute of limitations on assessment was time-barred. Agreeing to extend the statute of limitations on assessment or collection, even if immediate assessment or enforcement action will otherwise is threatened, is not always advantageous. One reason is that interest well above the prime rate will continue to accrue. Continue reading
Posted in IRS
Tagged abatement of interest, Appeals Office, audit, bankruptcy petition, collection due process, federal district court, Freedom of Information Act, innocent spouse relief, installment agreement, IRC § 6015(e), IRC § 6404(e), IRC § 7122. IRC § 6159, IRS collection, IRS levy, judicial review, NFTL, notice of federal tax lien, offer in compromise, refund claim, Reg. § 301.6343-3, statute of limitations, taxpayer assistance order
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Northern District Finds Successive Tax Penalties Imposed by NYS-AG and NYS-DTF to be Unconstitutional
Finding that Tax Law § 481(1)(b)(i) effectively operates as a criminal penalty, the Northern District held that the assessment of a tax penalty by the Department of Taxation and Finance under § 481(1)(b)(i) following the taxpayer’s previous prosecution and conviction … Continue reading
APPEALING A DETERMINATION OF THE TAX APPEALS TRIBUNAL
The Tax Appeals tribunal sits as the final administrative tax tribunal. A CPLR Article 78 proceeding is the “dotted line” in the flowchart that brings the tax dispute out of administrative tribunal system and into the New York judicial court system. From a tax petitioner’s standpoint, Article 78 is far from perfect: it possesses treacherous statutes of limitations, it is inherently capable of providing only narrowly circumscribed relief, and it imposes onerous bonding requirements. Still, like the Spirit of St. Louis, Article 78 will at least take the taxpayer into the courtroom of the Appellate Division, where counsel may be able to convince the Court of reversible error below.
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Defeating The Right of Election in EPTL § 5-1.1-A
Under Estates, Powers & Trusts Law (EPTL) § 5-1.1-A, a surviving spouse has a right to elect against the Will of a predeceasing spouse. The elective share is one-third of the net estate. The net estate consists of the net probate assets as well as testamentary substitutes. [EPTL § 4-1.1 provides that if the decedent dies intestate and is survived by a spouse and issue, the spouse takes $50,000 plus one-half of the residue; if there are no surviving issue, the spouse takes the entire estate.] Continue reading
IRS Criminal Investigations
The IRS reserves the threat of incarceration for taxpayers it believes are guilty of tax evasion, failure to file, or making false statements. About 3,500 cases commenced by the Criminal Investigation Division (CID) each year result in prosecution. CID generally focuses on cases having a high deterrent value. Continue reading
Trust May Compliment Prenuptial Agreement
The prenuptial agreement effec tively protects against the vagaries of marital dissolution. However, even a well-drafted prenuptial agreement will not always succeed in fully accomplishing this objective. For ex ample , the agreement will likely not prevent separate property from becoming marital property if as sets are commingled. Continue reading
AVOIDING CHALLENGES TO TESTAMENTARY INSTRUMENTS
Protracted legal proceedings by disgruntled descendants and relatives asserting lack of testamentary capacity or undue influence deplete the estate and delay distribution. Therefore, steps taken by the testator before death which minimize the possibility of later challenge are essential. Although somewhat surprising, the mere choice of who witnesses the will execution may later determine the success of a will contest. Favorable testimony given by attesting witnesses at an SCPA § 1404 deposition may facilitate the admission of the instrument into probate, or at least force a favorable settlement. Continue reading
Attorney-Client Privilege in Tax Disputes
The attorney-client privilege protects confidential communications between attorneys and clients. The privilege extends to an accountant hired by an attorney to assist in understanding the client’s financial information. U.S. v. Adelman, 68 F.3d 1495 (2nd Cir. 1995). Privileged attorney-client communications include expressions conveyed through conversations, documents, records and internal memoranda. Even billing and travel records, and expense reports, may be protected if they relate to a privileged matter. Continue reading
INSTALLMENT SALES OF ASSETS TO GRANTOR TRUSTS
Installment sales of assets to irrevocable grantor trusts is one of the most powerful estate planning techniques available today. Sales to “intentionally defective” irrevocable grantor trusts capitalize on different definitions of “transfer” for income and transfer tax purposes. Following such a sale, the grantor reports income tax on trust income. However, the grantor no longer owns the assets for gift and estate tax purposes. Therefore, the trust assets (and appreciation) will be removed from the grantor’s gross estate. Assets sold to the trust may consist of stock in a closely held business, real estate, marketable securities, or limited partnership interests. The trust may even hold S Corporation stock without jeopardizing the election. Continue reading
Importance of Trusts in Estate Planning & Asset Protection
A trust beneficiary possesses an equitable interest, but not legal ownership, in trust property. Creditors of a trust beneficiary therefore cannot generally assert claims at law against the beneficiary’s equitable interest in trust assets. However, under common law, a settlor … Continue reading
Validity, Interpretation & Effect of Wills Having Jurisdiction Outside of New York
PDF: Wills Having Jurisdiction Outside NYS The burden of proof that a will was executed in accordance with formal requirements imposed by EPTL § 3-2.1 is on the will’s proponent, who may be the executor, a beneficiary, or an interested … Continue reading
April 21, 2010 Tax Seminar in Lake Success, New York
To view April 21, 2010 Tax Seminar Invitation, or to Attend Seminar, press here: April 21 Tax Seminar Invitation The lecture will first discuss researching and drafting the Petition to the DTA following the Conciliation Conference. Pre-hearing motion practice and … Continue reading
Installment Sale Reporting of Deferred Exchange Boot
IRC §453 provides that an “installment sale” is a disposition of property where at least one payment is to be received in the taxable year following the year of disposition. Income from an installment sale is taken into account under the “installment method,” whereby income recognized in any taxable year following a disposition equals a proportion of the payments received, that proportion being equal to the gross profit over the total contract price. Continue reading
Posted in Federal Income Tax, Like Kind Exchanges
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General Power of Appointment Can Neutralize Estate Tax
A general power of appointment is power of appointment that is exercisable in favor of the donee, the donee’s creditors, or the creditors of the donee’s estate. Under IRC § 2042, the value of property over which the donee possesses a general power of appointment at death is included in the donee’s estate. Continue reading
Posted in Estate Planning, General Power of Appointment
Tagged 2523(f), applicable exclusion amount, appoint trust assets, completed gift, credit shelter, credit shelter trust, equalize, equalize estates, general power of appointment, PLR 200101021, PLR 200210051, PLR 200403094, PLR 200604028, QTIP, testamentary general power of appointment, unequal estates
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Marital Deduction Planning
By making a QTIP election, the Executor will enable the decedent’s estate to claim a full marital deduction. To qualify, the trust must provide that the surviving spouse be entitled to all income, paid at least annually, and that no person may have the power, exercisable during the surviving spouse’s life, to appoint the property to anyone other than the surviving spouse. Since the Executor may request a 6 month extension for filing the estate tax return, the Executor in effect has 15 months in which to determine whether to make the QTIP election. Continue reading
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