Month: June 2011

Current News and Developments

EO Tax Journal 2011-109

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This and That

In response to yesterday’s query, “What would she have gotten if she had succeeded?”, Penelope says 15 days. Penelope says she got 30 days because she botched the job.

Regarding Bill Brockner’s comments published yesterday, Odysseus takes issue with Bill’s implication that small organizations, which are “generally without the benefit of expensive CPA and/or Bar assistance,” will now be required to hire the same. Odysseus wonders if Bill knows how simple it is to complete an e-Postcard, since all that is required are eight simple entries.

Current & Quotable

EO Tax Journal 2011-108

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My favorite headline from yesterday’s Baltimore Sun: “Maryland Woman Sentenced to 30 Days in Prison for Trying to Run Boyfriend Over with Car.” What would she have gotten if she had succeeded? 45 Days?

I welcome all points of view, so today I’m happy to let former IRSer Bill Brockner make the case for what I call libertarianism in the EO sector. Bill joined the EO Division in 1972 and stayed until sometime in the aughts, over 30 years, maintaining his passion for EO tax law the whole time while becoming one of the IRS’s top EO technical experts.

Commentary by Bill Brockner

Editor's Notebook

EO Tax Journal 2011-106

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My policy is to include everyone’s comments in these email updates so that we have an ongoing dialogue. Today some of my favorite readers speak out.

1 – Milt Cerny on Kip Dellinger Article

2 – Bill Brockner on Section 509(a)(3), Chapter 42, AARP

3 – Editor Exposed — Commentary Muddled

Current News and Developments

EO Tax Journal 2011-104

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Today I’m sending along Bob Boisture’s article on the recent AARP hearing. His article was previously published by Tax Analysts, so you may have already seen it.

Bob is very concerned by what he views as the deeply flawed legal analysis presented in the report on AARP prepared by two House Republicans. He is also concerned that AARP has not presented a more rigorous and comprehensive statement of its legal position. In his opinion, AARP has by far the stronger side of the legal issues raised in the report, but he does not believe AARP’s various public statements have made this sufficiently clear, making it easier for House Republicans to justify continuing their investigation.

Focus on Congress

EO Tax Journal 2011-102

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Today we have the latest installment of gift tax developments in the context of section 501(c)(4) organizations. For earlier reports, see email updates 2011-77, 2011-84, and 2011-91. First we have the June 3 letter of the Chairman of the House Ways and Means Committee, Dave Camp, to IRS Commissioner Douglas Shulman. Second, for those who have been ignoring these developments and want a quick review, I’m including a summary prepared by our friends at Caplin & Drysdale.

Focus on IRS and Treasury

EO Tax Journal 2011-98

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1 – Query re Yesterday’s News

2 – More on EO CPE Textbook Chapters Being Excreted, Exorcised, Expurgated, Expunged, and Expelled

3 – Customer-Friendly IRS Responds with Alacrity to AHA’s Concerns (Announcement 2011-37)

4 – AHA on ACOs

Focus on Courts

EO Tax Journal 2011-95

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As I’ve noted, the Tax Court makes it difficult for the press and the public to follow what is going on in its docketed cases, almost all of which contain public information, but because of the Tax Court’s Rule 27, access is severely limited.

As a result, I can only obtain information about current cases at great difficulty and expense. Today’s case is Capital Gymnastics Booster Club, Inc. v. Commissioner. The case is fully briefed and went to trial in November 2010 before Judge David Gustafson. The Pretrial Memorandum for Respondent, reprinted below, lays out the issues. The case file contains a copy of the IRS Exempt Organizations Continuing Professional Education Technical Institute Program textbook chapter from FY 1993 that is directly on point, which is also reprinted below.

Once again, I have to ask (as I have with the Bartels and Polm cases), why? Why is the taxpayer going to court with, in my opinion, little or no chance of winning? Then again, you have the recent Driscoll case, so I suppose anything’s possible.

Transcripts (Other)

EO Tax Journal 2011-94

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Weekend reading thanks to Victoria Bjorklund and Phil Hackney. Their outline was sent out yesterday.

Update on Supporting Organizations and Donor-Advised Funds

What follows are the April 28 remarks of Victoria Bjorklund, Simpson, Thacher & Bartlett, New York, and Phil Hackney, Office of Chief Counsel, Internal Revenue Service, Washington, as delivered to attendees of the annual Georgetown Law program on Representing & Managing Tax-Exempt Organizations. The moderator is Celia Roady, Morgan, Lewis & Bockius, Washington.

Transcripts (Other)

EO Tax Journal 2011-93

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Truth is often funnier than fiction. Yesterday my hometown newspaper, the Baltimore Sun, had a story about attorney Stanley Needleman (wasn’t he in Animal House?) who is accused of stealing a judicial clerk’s textbook while in court. Seems Needleman was caught on the court’s surveillance cameras taking the textbook valued at $41. Needleman is claiming his innocence of course, but in April his home was raided by DEA agents who seized $600,000 in cash. While allegedly engaged in the textbook theft, Needleman was also representing a client who got a ten-year sentence for possessing drugs with intent to distribute. I wonder how the client feels about his representation? And why is Needleman still representing clients in court? Probably best not to ask.

The IRS has officially announced that the TE/GE Advisory Committee will hold its annual public meeting on June 15. See IR-2011-60 for details if you wish to attend (photo identification required, body scans optional). The EO members will be presenting their report, “Group Exemptions — Creating a Higher Degree of Transparency, Accountability, and Responsibility.” The TEB members’ report is “The Role of Conduit Issuers in Tax Compliance.”

Today I’m sending along Victoria Bjorklund’s outline that she prepared as background for her queries to Phil Hackney at the recent Georgetown program on tax-exempt organizations. Phil left the IRS for academia (LSU Law School) on May 20 but he had been one of the IRS’s experts on SOs and DAFs. Folks who are familiar with SOs and DAFs can skip the General Overviews and go directly to Victoria’s Current Developments and Questions. Tomorrow I will have a transcript of her remarks and Phil’s responses to her questions.