Taxation General Discussion - Recent Threads

New IRS easement office ought to prioritize faster settlements, expert says

Neil Vicente — Mon, 07 Sep 2026 13:00:27 GMT

New easement office established, May framework replaced

The IRS announced the office in an August 19 news release, ending the uniform settlement initiative it began in May. The agency said the new office will centralize expertise for the more than 1,100 conservation easement cases pending in the U.S. Tax Court and under IRS examination. The office will coordinate policy, enforcement, and case-resolution strategy with the Office of Chief Counsel and work with the Treasury Department on administrative and legislative options and on valuation integrity.

In recent litigation, the government has generally prevailed, the IRS said, with the Tax Court on average allowing about 6% of the claimed deduction and imposing a 40% gross valuation misstatement penalty, plus interest.

The August announcement was a pivot from the settlement program the IRS detailed on May 13. That initiative offered standardized terms to a broad group of taxpayers, requiring them to give up the disputed charitable deduction and accept a 10% penalty, with 90 days to decide. O’Brien said the move to a dedicated office may reflect limited uptake of that offer.

To dig deeper, visit the original article on the Thomson Reuters blog.

Agency FAQs Provide Enforcement Relief and Clarification on Wellness Program Reward Requirements

Neil Vicente — Mon, 07 Sep 2026 12:22:02 GMT

The DOL, HHS, and IRS have issued two FAQs addressing questions raised in dozens of class action lawsuits challenging tobacco surcharges imposed under employer-sponsored group health plans. As background, the 2013 tri-agency wellness regulations treat a tobacco-use premium surcharge (or tobacco-free discount) as a wellness “reward.” When the premium differential is conditioned on satisfying a standard related to a health factor—such as refraining from tobacco use—the program is generally an outcome-based health-contingent wellness program. As such, it must satisfy various requirements, including making the full reward available to all similarly situated individuals by offering a reasonable alternative standard (RAS) for obtaining the reward. The preamble to the 2013 regulations states that if a participant satisfies an RAS partway through the plan year, the plan must provide the full reward retroactive to the beginning of the plan year. Courts have been divided on whether this retroactive approach is required. A related issue is the scope of the required RAS disclosure.

According to the FAQs, the preamble to the 2013 final regulations indicates that the full reward must be provided retroactively, but the regulatory text does not clearly require retroactive application. Thus, until further guidance or regulations are issued, the Departments will not take enforcement action against a plan or issuer that provides the reward only prospectively—that is, from the point at which the participant satisfies the RAS—so long as the plan otherwise satisfies the applicable wellness program requirements and provides sufficient time for participants to complete the alternative standard and receive a reward. The FAQs emphasize that this enforcement relief does not affect other requirements, including the requirement that a program must be reasonably designed to promote health or prevent disease and not operate as a subterfuge for discrimination based on a health factor.

To dig deeper, visit the original article on the Thomson Reuters blog.

5th Circuit upholds IRA drug pricing program, excise tax

Neil Vicente — Mon, 07 Sep 2026 12:15:05 GMT

Background

At issue is the Inflation Reduction Act (IRA), P.L. 117-169, which directed the Department of Health and Human Services (HHS) to negotiate the prices of certain high-cost drugs covered under Medicare. To secure manufacturer participation, the IRA created an escalating excise tax under IRC § 5000D.

According to the 5th U.S. Circuit Court of Appeals, the statute expresses the tax rate as a percentage of the total sale price, including the tax amount, with the rate beginning at 65% and, after 271 days, reaching 95%. Expressed as a share of the post-tax amount the manufacturer keeps, that translates to a rate starting at 186% and climbing to 1,900%.

Suing in the U.S. District Court for the Western District of Texas, the National Infusion Center Association, the Global Colon Cancer Association, and the Pharmaceutical Research and Manufacturers of America argued that the program violates the nondelegation doctrine, the Eighth Amendment’s excessive fines clause, and the Fifth Amendment’s due process clause.

To dig deeper, visit the original article on the Thomson Reuters blog.

Senators raise concerns about potential misuse of alternative fuel excise tax credit

Nageshwaran Gopal — Mon, 31 Aug 2026 19:35:25 GMT

A group of Democratic senators has asked the Treasury Inspector General for Tax Administration (TIGTA) to investigate the IRS’ legal basis for allowing liquefied natural gas tankers to claim a tax credit they say is intended for motorboats.

An August 20 letter headed up by Senator Jeff Merkley (D-OR) questions whether the IRS properly allowed companies to claim the alternative fuel excise tax (AFET) credit for fuel used to propel liquefied natural gas (LNG) tankers.

The letter, which Senate Democratic Leader Chuck Schumer (D-NY), and Senators Chris Van Hollen (D-MD), Edward Markey (D-MA), and Sheldon Whitehouse (D-RI) signed on to, also asks whether the decision was intended to reward political donors to President Trump. The lawmakers urge TIGTA to open an investigation.

To dig deeper, visit the original article on the Thomson Reuters blog.

Treasury proposes rules defining stablecoin issuance, sales in U.S.

Neil Vicente — Mon, 24 Aug 2026 10:55:58 GMT

The Treasury Department has proposed rules defining what counts as issuing, offering, or selling payment stablecoins in the United States, and has asked the public to weigh in on how the new federal stablecoin law should reach cross-border activity. (TREAS-DO-2026-0496, 8/18/2026)

The Notice of Proposed Rulemaking (NPRM) sets out Treasury’s framework for implementing section 3 of the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, P.L. 119-27, and builds on an advance notice the department issued in September 2025. It defines key terms left open by the statute and creates safe harbors for market participants.

“Treasury welcomes input from stakeholders as we work to provide the regulatory certainty businesses need to innovate and grow in America,” Treasury Secretary Scott Bessent said in a statement. The department is accepting comments for 60 days after the rule’s publication in the Federal Register, submitted through the federal eRulemaking portal.

To dig deeper, visit the original article on the Thomson Reuters blog.

New York City to continue pied-à-terre tax rollout despite court challenge

Nageshwaran Gopal — Mon, 17 Aug 2026 13:43:35 GMT

Pied-à-terre tax basics

The new non-primary residence property surcharge, or pied-à-terre tax, was put in place as part of New York state’s fiscal year 2026-2027 budget.

The budget legislation authorizes New York City to impose a surcharge on residential property that does not serve as a primary residence, effective for fiscal years beginning July 1, 2026, to June 30, 2031.

The surcharge applies to one- to three-family homes valued at $5 million or more, as well as condominiums and co-ops valued at $1 million or more, when their owners maintain a separate primary residence. Properties that are the primary residence of the property owner, a tenant, or a subtenant are not subject to the surcharge.

To dig deeper, visit the original article on the Thomson Reuters blog.

Multistate Monitor — Missouri rejects income tax phase-out, bucking state trend

Neil Vicente — Mon, 10 Aug 2026 12:30:06 GMT

Missouri voters defeated Amendment 5, a proposed constitutional amendment that would have required reductions in the state individual income tax as net general revenue collections grow, with the goal of eliminating the tax by January 1, 2032. The measure failed, with approximately 83.3% opposed and 16.7% in favor. Roughly 1.4 million ballots were cast.

Under House Joint Resolution Nos. 173 & 174, each $20 million increase in prior-year net general revenue collections above an inflation-adjusted fiscal year 2025 baseline would have triggered a 0.01-percentage-point rate cut, up to 1.6 percentage points a year. If the revenue triggers had not reduced the rate to zero by 2032, the reductions would have continued until the tax was gone. Once the tax reached zero, Missouri could not have imposed a new one.

The amendment would also have authorized the General Assembly to expand state and local sales and use taxes to goods and services not taxable as of January 1, 2015. Beginning in 2029, local governments generally would have had to reduce certain sales, property, or earnings tax rates to offset added revenue from a base expansion. The measure prohibited reductions in public-school funding.

To dig deeper, visit the original article on the Thomson Reuters blog.

SEC stays controversial Nasdaq $5 million listing rule pending review

Neil Vicente — Mon, 10 Aug 2026 12:16:43 GMT

The Securities and Exchange Commission (SEC) has paused its July 22, 2026, approval of a controversial Nasdaq proposal that would establish a new continued listing requirement mandating companies to maintain at least $5 million in market value of listed securities.

In a July 29 letter to Nasdaq Senior Counsel Nikolai Utochkin, the SEC said it had received notices of intent to petition for commission review of the approval, which had been issued by the agency’s Division of Trading and Markets under delegated authority. The commission posted five letters of petition, including one from the Small Public Company Coalition.

The July 22 approval order “is stayed until the Commission orders otherwise,” the SEC letter says.

The proposed rule, filed as SR-NASDAQ-2026-004, would add a $5 million Market Value of Listed Securities, or MVLS, continued listing standard for companies on the Nasdaq Global Select Market, Nasdaq Global Market and Nasdaq Capital Market.

To dig deeper, visit the original article on the Thomson Reuters blog.

SEC adopts amendments to reflect court vacated fund governance requirements

Neil Vicente — Mon, 10 Aug 2026 12:00:00 GMT

The SEC on August 4, 2026, adopted technical amendments to its investment company governance rules to update federal regulations and reflect a federal court decision that vacated certain fund governance requirements adopted in 2004.

The commission revised Rule 0-1(a)(7) under the Investment Company Act of 1940 and updated the Code of Federal Regulations to reflect the legal effect of a court ruling that eliminated two governance provisions affecting registered investment companies and business development companies, collectively referred to as regulated funds, according to Release No. IC-36282, Investment Company Governance Technical Amendments.

The SEC said the court’s vacatur took effect on July 6, 2006, and restored the governance standards that were in place before the 2004 amendments. The technical amendments remove references in the regulations to the vacated requirements and reinstate the prior standard that a majority of a fund’s directors be disinterested directors.

To dig deeper, visit the original article on the Thomson Reuters blog.

Student-athletes unprepared for NIL tax bills, expert warns

Neil Vicente — Mon, 10 Aug 2026 11:55:08 GMT

The new era of name, image, and likeness (NIL) deals has turned many college athletes into small business owners, and the tax obligations often catch them off guard. Most NIL arrangements classify athletes as independent contractors rather than employees, so they receive a Form 1099 with no tax withheld, a shift that many young adults do not expect.

“The IRS considers them a business owner, and they’re going to be filing a Schedule C on their tax return and reporting business income,” Jennifer Blackwood, managing principal of tax at PYA, told Checkpoint.

Athletes who have “probably never even paid tax,” she noted, are suddenly responsible for complex filings, including self-employment tax — an outcome that can be “a big surprise” as more players become subject to income tax.

To dig deeper, visit the original article on the Thomson Reuters blog.

Senate panel advances broad tax administration reform package

Nageshwaran Gopal — Mon, 03 Aug 2026 18:48:51 GMT

On July 30, the Senate Finance Committee overwhelmingly approved the bipartisan Taxpayer Assistance and Service (TAS) Act, S. 3931, with a 26-1 vote, setting the package up for consideration by the full Senate. The TAS Act includes over 60 bipartisan proposals – several of which have already advanced in the House.

Finance Chair Mike Crapo (R-ID) released modifications to the bill prior to the hearing. Included were revisions to the electronic filing identification number (EFIN) provisions and a clarification regarding tax-exempt entities’ appeal rights. In addition, Crapo called for boosted penalties for unauthorized release of taxpayer information.

To dig deeper, visit the original article on the Thomson Reuters blog.

Multistate Monitor — Tax pros delve into state initiatives to tax the wealthy

Nageshwaran Gopal — Mon, 03 Aug 2026 18:34:27 GMT

Wealth taxes popping up at the state level are causing some high-net-worth taxpayers to question their future tax planning strategies — while others are simply relocating. Tax experts delved into these new tax approaches and what’s driving them.

Anthony Sciarra, partner-in-charge of tax at Armanino, highlighted the difference between wealth taxes and current income- and transaction-based taxes. And a recent Deloitte panel provided updates on efforts in California, New York City, and Washington state to impose new taxes on high-net-worth individuals.

To dig deeper, visit the original article on the Thomson Reuters blog.

Is your tax department actually understaffed?

Neil Vicente — Mon, 27 Jul 2026 11:47:50 GMT

Most CFOs treat the tax department the way they treat the boiler room of a building. As long as nothing is on fire, the staffing model is working. Headcount stays flat. Software requests get deferred. Compliance gets done. The audit closes. From the top of the org chart, tax looks like a function that scales gracefully: quiet, dependable, and inexpensive relative to its risk surface.

That picture is almost always wrong, and the gap between picture and reality is one of the more expensive blind spots in modern finance leadership. The problem isn’t that tax departments are under-resourced in the obvious way. The problem is that the costs of running them lean show up in places CFOs don’t typically look, on lines that don’t typically get attributed back to tax.

To dig deeper, visit the original article on the Thomson Reuters blog.

Section 338 tariffs on Canada: What businesses may be missing beyond the headline categories

Neil Vicente — Mon, 27 Jul 2026 11:44:37 GMT

What is Section 338?

Section 338 dates back to the original 1930 Smoot-Hawley Tariff Act, the law economic historians generally credit with deepening the Great Depression by triggering a wave of retaliatory tariffs worldwide. The provision was built to enforce reciprocity: a tool to keep trading partners from giving other countries better treatment than they gave the United States, not a general-purpose lever for broad tariff action.

For nearly a century, it sat unused. Trade officials note that past administrations, including Franklin D. Roosevelt’s, weighed invoking it and never followed through. July’s proclamations mark its first confirmed use.

To dig deeper, visit the original article on the Thomson Reuters blog.

Appeals court upholds disallowance of $23 million conservation easement deduction

Neil Vicente — Mon, 27 Jul 2026 11:38:27 GMT

Easement donation and Tax Court ruling

In 2017, Savannah Shoals, LLC, donated a conservation easement over a 103-acre property in Hart County, Georgia. On its tax return, it claimed a $23 million charitable contribution deduction under IRC § 170. This value was based on the assertion that the property’s “highest and best use” before the easement was as an aggregate quarry. The IRS rejected the deduction and assessed a 40% gross valuation misstatement penalty.

The taxpayer challenged the IRS’ determination in the U.S. Tax Court, but the court agreed with the IRS, finding that the proposed quarry was not the highest and best use of the property because it was not a viable use. The court concluded that the property’s value before the easement was $580,000, and its value after the easement was $100,000, resulting in a correct deduction of only $480,000.

To dig deeper, visit the original article on the Thomson Reuters blog.

SEC’s Atkins says no-action policy shift yields few proxy season disruptions; backs ‘materiality overlay’ in disclosure reform

Neil Vicente — Mon, 13 Jul 2026 11:21:14 GMT

Securities and Exchange Commission (SEC) Chairman Paul Atkins said that a major policy shift implemented last year — in which the staff stopped responding to companies’ no-action requests during the proxy season — did not result in the disruptions that some had predicted.

In November 2025, the SEC’s Division of Corporation Finance (CorpFin) announced that its staff would no longer respond to no-action letter requests related to Rule 14a-8 of the Securities Exchange Act of 1934, which governs rules on shareholder proposals, for the proxy season running from October 1, 2025, to September 30, 2026.

The announcement drew mixed predictions, Atkins said.

Some skeptics said that companies might systematically exclude most or all proposals, while others cited litigation risk or adverse recommendations from proxy advisers as reasons why companies might include proposals that they believed were excludable under Rule 14a-8.

To dig deeper, visit the original article on the Thomson Reuters blog.

Lawmakers caution Trump-IRS settlement could provide multiple companies with ‘get-out-of-jail-free cards

Neil Vicente — Mon, 13 Jul 2026 11:18:04 GMT

A trio of Democrats has asked 11 company and organization leaders whether they believe that, due to ties to President Trump and his family, they qualify for immunity under the recent Trump-IRS settlement. Among the entities named as potential beneficiaries of the agreement are prediction market platforms Kalshi and Polymarket and cryptocurrency platform American Bitcoin.

The letters, signed by Senator Elizabeth Warren (D-MA), Minority Leader Chuck Schumer (D-NY), and Senate Finance Committee Ranking Member Ron Wyden (D-OR), push company leaders for answers on whether they believe they are “related or affiliated … parties” described in a May settlement between Trump and the IRS.

The settlement resolved Trump’s $10 billion lawsuit against the IRS over the unauthorized disclosure of his tax information by former IRS contractor Charles E. Littlejohn. A May 19 Justice Department order issued as part of the settlement permanently bars the IRS from auditing past tax returns of, or pursuing claims against, Trump, his family, and related companies.

To dig deeper, visit the original article on the Thomson Reuters blog.

11th Circuit weighs Coca-Cola, IRS clash over transfer pricing methodology change-up

Neil Vicente — Mon, 13 Jul 2026 11:14:20 GMT

Background

In a 2020 opinion, the Tax Court sustained the IRS’ reallocation, for the 2007, 2008, and 2009 tax years, of about $9 billion in income from seven of Coca-Cola’s foreign manufacturing affiliates, known as “supply points,” to its U.S. parent company. (155 T.C. 145, 11/18/2020)

The IRS made the adjustment after it abandoned the transfer pricing method the parties had used for years — a formula known as the “10-50-50” method that was memorialized in a 1996 closing agreement for prior tax years. Instead, the IRS used the comparable profits method under IRC § 482, which determined the foreign subsidiaries’ profits by comparing them to independent Coca-Cola bottlers.

The Tax Court found this was not an abuse of the IRS’ discretion, and Coca-Cola appealed to the 11th Circuit.

To dig deeper, visit the original article on the Thomson Reuters blog.

After IEEPA: Which tariff authorities does the U.S. government still have — and what global manufacturers need to know

Neil Vicente — Mon, 13 Jul 2026 10:55:44 GMT

Highlights

Supreme Court struck down IEEPA tariffs; Section 301 and 232 remain active and expanding.
Section 122 faces legal challenges and expires July 2026 under statutory limits.
Integrated trade management systems now essential to navigate fragmented tariff authority landscape.

For most of 2025, the tariff story was dominated by a single legal instrument: the International Emergency Economic Powers Act (IEEPA). It was the broadest tool available, applied sweepingly across U.S. trading partners, and it set the compliance agenda for trade professionals worldwide. Then, on February 20, 2026, the U.S. Supreme Court struck it down. In the months since, trade compliance professionals have been asking a foundational question: if IEEPA is gone, what’s left?

To dig deeper, visit the original article on the Thomson Reuters blog.

Maryland provides Washington County target redevelopment area sales and use tax exemption

Nageshwaran Gopal — Tue, 07 Jul 2026 12:14:21 GMT

Target redevelopment area tax exemption

The sales and use tax does not apply to a sale of construction material or warehousing equipment if: (1) the material or equipment is purchased by a person solely for use in a target redevelopment area; and (2) the buyer provides the vendor with evidence of eligibility for the exemption issued by the Maryland Comptroller. For at least three years after the date of the sale, the buyer must maintain a record of the amount of sales and use tax that was not paid as a result of the exemption. On or before October 1, 2027, and each subsequent October 1, each buyer that receives a sales and use tax certificate must report to the comptroller the amount of sales and use tax that was not paid as a result of the exemption during the immediately preceding fiscal year.

To dig deeper, visit the original article on the Thomson Reuters blog.

Senators split over tax fixes as Social Security insolvency looms

Nageshwaran Gopal — Tue, 07 Jul 2026 12:11:14 GMT

The Senate Finance Subcommittee on Social Security, Pensions, and Family Policy met June 24, to weigh the future of Social Security. Members and witnesses agreed on the urgency of a looming shortfall but were divided over how to close it.

Without congressional action, the program’s primary trust fund is projected to run dry in 2032, triggering an automatic 22% benefit cut for every beneficiary.

Chairman Chuck Grassley (R-IA) used his opening statement to argue that revenue alone cannot fix the program, warning that the gap “cannot realistically be plugged simply through tax hikes on the wealthy” — the Democrats’ favored solution, nor by only curbing waste, fraud, and abuse — the Republican one.

To dig deeper, visit the original article on the Thomson Reuters blog.

When Is a Home Sale Really Tax-Free?

Neil Vicente — Mon, 29 Jun 2026 12:10:45 GMT

What Counts as a Principal Residence?

For principal residence gain exclusion purposes, the question isn’t “did the taxpayer own a house,” but “was this property, based on all the facts and circumstances, the taxpayer’s principal residence?” A principal residence is generally the taxpayer’s main home, and the term residence is broad enough to include a house, condominium, cooperative apartment, mobile home, house trailer, or even a houseboat, so long as the taxpayer is entitled to occupy it and uses it as a home.

When a taxpayer has multiple residences, perhaps a city condo and a lake house, the regulations tell us to look first at where the taxpayer spends the majority of their time during the year, but this isn’t the only factor. The regulations provide a nonexclusive list of additional indicators: the location of the taxpayer’s employment; where family members live; the address used on federal and state income tax returns; the address on a driver’s license, vehicle registration, and voter registration; the address where bills and correspondence are sent; where the taxpayer’s banks are located; and the location of religious and recreational organizations the taxpayer frequents. Clients chasing state tax benefits or lifestyle flexibility can unintentionally scatter these ties across more than one location; by the time of sale, their own paperwork may support the IRS’s argument that the property they want to treat as the principal residence was, in fact, the vacation home.

To dig deeper, visit the original article on the Thomson Reuters blog.

Sanders calls for tax on ‘systemically important AI activity,’ payable in equity

Neil Vicente — Mon, 29 Jun 2026 12:03:29 GMT

Senator Bernie Sanders (I-VT) has proposed a remittance tax on certain artificial intelligence companies amounting to 50% of the company’s outstanding equity interests. Sanders says these equity interests could be used to establish a sovereign wealth fund, with annual direct payment distributions to Americans.

Sanders shared details of the proposal, dubbed the American AI Sovereign Wealth Fund Act, in a June 18 press release.

He previewed the effort in Senate floor remarks weeks earlier. “Since AI is built on the collective knowledge of humanity, the wealth it generates must benefit humanity,” Sanders said on June 1. He described his proposal as imposiAIng a “one-time, 50-percent tax not on the profits of the largest AI companies in the United States but something that is far more valuable than that: the stock.”

To dig deeper, visit the original article on the Thomson Reuters blog.

What accounting firms fear about GenAI — and what’s worth worrying about

Nageshwaran Gopal — Mon, 22 Jun 2026 16:06:29 GMT

Will AI replace you? Should you trust it? Can you afford to wait? These questions keep accounting professionals up at night.

The truth is that AI won't replace accountants, but accountants who use AI will replace those who don't. Yet adoption remains slow because legitimate concerns about accuracy, security, ethics, and job displacement create paralysis. The firms that thrive in the next five years will confront these challenges head-on.

In this white paper you'll get straight answers to the hardest questions about generative AI in accounting, from staff fears of obsolescence to data security and hallucination risks. You'll also discover proven strategies for overcoming each roadblock.

What you'll learn:

How retrieval-augmented generation (RAG) solves AI's No. 1 barrier — accuracy and reliability concerns
Strategies to overcome the three critical roadblocks to AI adoption
Why professional-grade AI built on verified sources outperforms public LLMs
How to build staff trust while repositioning your team for higher-value advisory work
Strategic approaches to security and oversight across traditional AI, generative AI, and agentic AI
Real ways to convert AI efficiencies into competitive advantages in recruitment, retention, and client experience

To dig deeper, visit the original article on the Thomson Reuters blog.

The real cost of disconnected corporate tax systems

Neil Vicente — Mon, 15 Jun 2026 14:31:03 GMT

Your team closes another quarter. Trial balances arrive in varying formats from multiple Enterprise Resource Planning (ERP) systems. Controllers submit provision data via email. State apportionment calculations live in spreadsheets passed between analysts. Estimated payments are manually entered into multiple systems.

The compliance work gets done — it always does. But the hours spent reconciling data, chasing submissions, and validating accuracy across disconnected tools consume the capacity your team needs for work that actually moves the organization forward.

This isn’t a headcount problem. It’s an integration problem.

The 2025 State of the Corporate Tax Department Report confirms what many tax leaders already know: 58% of tax departments globally report being under-resourced — and 59% lack confidence they can upgrade their tax technology in the next two years. The solution isn’t adding more tools, it’s connecting the ones that matter.

To dig deeper, visit the original article on the Thomson Reuters blog.