5th Circuit: Rejects Taxpayer Appeal of Distressed Asset Transaction

The Fifth Circuit affirmed the decision of the District Court (Northern District of Texas) denying the tax losses of Texas banker D. Andrew Beal. The Court of Appeals affirmed the lower court’s finding that the partnership through which the losses were generated was a sham and that the losses should be disallowed. However, the Circuit Court also affirmed the trial court’s determination that penalties should not be allowed.

Read the opinion here:
Southgate Master Fund v. US.

Fifth Circuit: Overstated Basis is Not Omitted Income for the 6-Year Statute of Limitations

The hits keep on coming. The Fifth Circuit joins the growing chorus from the Courts of Appeals holding that an overstatement of basis does not equal an omission of income and the 6 year statute of limitations does not apply.

Read the opinion here:
Burks v. United States, No. 09-11061 (5th Cir. Feb. 9, 2011)

Fifth Circuit Vacates Tax Court on Donation of Historical Facade Easement

The Fifth Circuit Court of Appeals vacated the Tax Court’s valuation of an historic fa├žade easement for charitable contribution purposes and remanded for further findings.

Whitehouse Hotel Limited Partnership v. Commissioner, Docket No. 09-60085 (5th Circuit August 10, 2010)