Oropeza v. Commissioner: Tax Court Decision, 155 T.C. No. 9 (2020)

A tax court issued an opinion in October in favor of a micro-captive insurance owner who had been ordered to pay penalties on income reported in the 2011 tax year. Our Scottsdale tax attorneys can help explain this essential decision.

Initially, the IRS found that the taxpayer, Jesus R. Oropeza, had not properly reported income for the micro-captive insurance company he owned as an S-corporation. The IRS assessed a 20 percent accuracy-related penalty for “substantial understatement.”

However, the court looked closely at the record and found that the IRS did not obtain timely approval for the penalties assessed, and therefore, exceeded the deadline for doing so. The court found in the taxpayer’s favor, not on the grounds that he accurately reported income, but on the grounds that the IRS did not take action in a timely way and did not follow the proper procedure for assessing penalties.

Hiring a Tax Attorney

There are many complex rules surrounding micro-captive insurance companies and other companies or investments. If you receive a letter from the IRS saying that you owe money or that some legal action is being taken against you, you may feel overwhelmed or panicked and feel like you have no options. But as the case of Oropeza v. Commissioner proves, you can challenge these cases, and you have many strategies by which to do so.

Before you take any other action, you need to talk with a qualified Phoenix tax lawyer to understand the action being taken against you and your options for response. The tax attorneys at Silver Law PLC are ready to help if you have received notice from the IRS that you are being penalized or audited, or that criminal or civil action is being taken against you. Our tax law firm in Arizona has a team of lawyers who have years experience working for the IRS, and they understand how these cases are built against taxpayers – as well as how to defend against them. We’ll explore all options for challenging your case or minimizing the penalties against you.

Call Silver Law, PLC today to make an appointment with our qualified Phoenix tax lawyers and learn about your options.

Silver Law PLC

Arizona Location
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Scottsdale, AZ 85254
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Las Vegas, Nevada 89145
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