- The Ninth Circuit affirmed a taxpayer-favorable decision of the U.S. Tax Court that the taxpayers-builders were entitled to use the completed contract method of accounting under section 460 for reporting income and loss from the sales of housing development projects, and that the Tax Court did not clearly err in determining that the home sale contracts included certain development amenities and were not, as asserted by the IRS, limited simply to the house and the lot on which the house sat.
- Rev. Proc. 2016-47 provides rules for waiver of the 60-day rollover requirement from one retirement plan or individual retirement arrangement (IRA) into another plan or IRA by providing a “self-certification procedure” for taxpayers to use in claiming rollover treatment.
- The U.S. Tax Court found that because the taxpayer had not transferred “all substantial rights” to certain pharmaceutical technology, the royalties received by the taxpayer constituted ordinary income.
- An IRS “practice unit” (guidance for IRS personnel) publicly released this week concerns taxation on the disposition of a U.S. real property interest (USRPI) by foreign persons.
- Republican members of the House Ways and Means and Senate Finance committees reiterated in a letter to Treasury Secretary their concerns about the effects of proposed regulations under section 385 (also referred to as the “debt-equity” regulations).
- The IRS issued a correction on the enhanced oil recovery inflation adjustment factor.
- Indiana’s tax court held that a taxpayer (a scrap steel producer) qualified for manufacturing exemptions and, thus, was entitled to a refund of sales and use taxes remitted on certain equipment purchases.
- The Massachusetts Supreme Judicial Court (the highest court) held that a taxpayer must include certain loans in its Massachusetts property factor, and that the inclusion of these loans under the apportionment regime did not violate the internal consistency test.
- The Virginia Tax Commissioner ruled that a taxpayer providing subscription-based cloud computing services was not required to pay sales or use tax on its purchase or use of software or required to collect tax from its clients because all sales and use of the software occurred over the cloud, and no software was delivered in tangible form (under a longstanding policy that the sale of software delivered electronically or downloaded from the cloud does not constitute the sale of tangible personal property).
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- Rev. Proc. 2016-44 sets forth safe harbor conditions under which a management contract does not result in private business use or cause the modified private business use test under section 145(a)(2)(B) to be met.
- The priority guidance plan for 2016-2017 includes exempt organization projects that the IRS and Treasury Department intend to work on during the 12-month period ending 30 June 2017.
Read TaxNewsFlash-Exempt Organizations