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While the question remains pending before the World Trade Organization (WTO) as to whether a 2013 United States Department of Agriculture (USDA) country-of-origin labeling (COOL) rule violates the United States’ WTO commitments, the United States Court of Appeals for the District of Columbia has upheld the constitutionality of the rule and denied an injunction stopping enforcement of the rule. Nonetheless, its future remains uncertain.
In a case of major significance to estate and business planning for closely-held corporations in Iowa, particularly farm corporations, the Iowa Supreme Court found that a minority shareholder of a family farm “C” corporation could be “oppressed” (which could lead to a liquidation of the corporation) even though the controlling shareholders had not breached any fiduciary duties in the course of operating the corporation.
The Iowa Court of Appeals has sent back for trial a family dispute ended by the district court on summary judgment. The district court found as a matter of law that an action to enforce an oral agreement involving the transfer of farmland was barred by the statute of limitations and the statute of frauds.
Read about Revenue Procedures and Monthly National Average Bronze Plan Premium for 2014
The United States Court of Appeals for the Eighth Circuit has upheld a verdict in favor of the plaintiff in her personal injury action against the owner of an Iowa sales barn. The plaintiff was stepped on by a horse and severely injured while attending a draft horse auction.
Tax law provides that if an expense was "paid or incurred in connection with the administration of thest estate or trust...which would not have been incurred if the property were not held in such estate or trust" the expense deduction is not subject to the 2 percent floor.
The technology is here. The uses are many. Unfortunately, for those farmers wishing to take off, the commercial use of unmanned aerial vehicles (UAVs), also known as drones, is illegal, and a clear regulatory framework is yet to be developed.
A taxpayer cannot fully deduct losses from a trade or business unless the taxpayer is a material participant in the business. The tests for material participation are listed below. If material participation is not present, the losses associated with the activity are passive.
The Iowa Court of Appeals has ruled that a district court improperly awarded summary judgment in favor of three siblings in the fourth sibling’s action alleging undue influence over their mother by the defendants.
Earlier this year, the D.C. Circuit Court of Appeals invalidated an IRS regulation that said the IRS could regulate previously unregulated tax return preparers. IRS had claimed that tax return preparation meant that the tax return preparer was “representing” the taxpayer before the IRS such that IRS had regulatory power over the preparer.
In a split opinion, the Iowa Supreme Court upheld water quality (“antidegredation”) regulations developed by the Iowa Environmental Protection Commission (EPC), even though the EPC, at the time the rules were developed, was not constituted in accordance with state law.
In a move of incredible importance to agriculture, the Environmental Protection Agency has taken the blatantly unconstitutional position that it has the power to garnish wages when it fines an individual or other party for what EPA claims is some violated environmental provision over which it has regulatory authority.
In what has become somewhat of a theme over the past couple of legislative sessions, the Iowa legislature, during its 2014 session, has overturned more Iowa Supreme Court opinions with legislation.
Minority shareholders in a small, closely-held corporation are in a precarious position. They have no control over management of the corporation and, for example, can’t force dividends to be paid or force a corporate liquidation. Clearly, corporate directors (including those acting as directors) owe a fiduciary duty to the corporation with respect to their actions as directors, and those fiduciary duties apply in the context of directors’ ability manage the closely-held business within their discretion. At the same time, corporate directors that control the closely-held corporation can g
The Iowa Court of Appeals recently found that an estate beneficiary who was overpaid by the corporate executor of his mother’s estate was liable to repay the estate $106,712.38.
The Iowa Supreme Court has ruled that neither the federal Clean Air Act(CAA), nor its Iowa counterpart, Iowa Code chapter 455B, preempts state common law claims alleging negligence, nuisance, or trespass. In so holding, the Court denied summary judgment to a grain processing company and allowed a lawsuit demanding injunctive and monetary relief filed by eight Muscatine residents to continue.
On June 12, the U.S. Supreme Court ruled that a bankruptcy debtor’s inherited IRA does not constitute “retirement funds” and, as such, is not exempt from creditors. The Court’s opinion has planning implications for clients, but the Court’s holding may not have application to debtors in all states.
31 USC §330 authorizes the Treasury Department to regulate tax practitioners and their representation before the Internal Revenue Service. Individuals subject to the Regulations Governing Practice before the Internal Revenue Service, 31 C.F.R. Part 10 (Circular 230), must meet certain standards of conduct in connection with the practice of tax law.
On June 11, 2014, a three-judge panel of the U.S. Court of Appeals for the Eighth Circuit heard oral arguments in Morehouse v. Comr., 140 T.C. No. 16 (2013). In Morehouse, the Tax Court agreed with the IRS that Conservation Reserve Program (CRP) payments are subject to self-employment tax because a recipient is engaged in a trade or business simply by signing the CRP contract with the intent to profit from the CRP.
The Iowa Court of Appeals has ruled that a farmer obtained an easement by prescription to keep a large irrigation rig on a portion of his neighbors’ property over which he already held a right of way.
Faced with sorting out the rights of a surviving common law spouse and a couple who purchased the deceased husband’s home in a judicially-approved sale, the surviving spouse appears to have prevailed.
Hunting ground is a precious commodity in Iowa. Hunters often approach landowners looking for ground to hunt. Whether to grant such permission and to whom to grant that permission is a complex decision.
In a case that should remind property owners to guard their legal boundaries or lose them, the Iowa Court of Appeals has ruled that a landowner established title to a tract of neighboring land through the doctrine of boundary by acquiescence.
IRS has a long history of challenging taxpayers that they believe are distorting income reporting by use of the cash method of accounting. They were at it again in a case involving a Texas cattle and horse breeding limited partnership that the IRS said was a tax shelter by virtue of being a “farming syndicate” and, therefore, was not entitled to use cash accounting. However, the court disagreed rather sternly.
The South Dakota Supreme Court has denied the petition filed by American Broadcasting Companies, Inc. (ABC), and other defendants (including Diane Sawyer and Jim Avila) asking the Supreme Court to review a lower court’s order allowing a defamation action brought by Beef Products, Inc. (BPI) to continue against ABC.
In a case disregarding long-established Iowa farm lease law, the Iowa Court of Appeals has found that a landlord was excused from statutory notice requirements because he and the tenant reached an “oral agreement” to terminate the lease.
In a case leaving the Ninth Circuit to impliedly question the continuing raison d’etre for the raisin regulations at issue, the Ninth Circuit Court of Appeals has found that reserve requirements in the Marketing Order Regulating the Handling of Raisins Produced from Grapes Grown in California, 7 C.F.R. Part 989 (Marketing Order), do not violate the Takings Clause of the Fifth Amendment to the United States Constitution.
On May 8, 2014, Vermont Governor Peter Shumlin signed into law H.112, “An Act Relating to the Labeling of Food Produced with Genetic Engineering.” Under the legislation, specified food products produced with genetic engineering must be labeled as such effective July 1, 2016. The required label on a covered food product must denote that a covered raw agricultural commodity was “produced with genetic engineering” or (for processed foods) was “partially produced with genetic engineering” or “may be produced with genetic engineering” or “produced with genetic engineering.” The legislation al
The current federal estate tax landscape is extremely favorable with a high exemption
amount and the recent permanence of portability in the tax code. It is now possible with
minimal to no estate or financial planning – a common reality today – for a married couple
to pass on $10.68 million in assets at the time of the second spouse’s passing without being
concerned about federal estate taxes. One practical effect of this realization is that it has
diminished much irrevocable trust planning, including the Spousal Lifetime Access Trust,
The Iowa Court of Appeals recently reversed a district court’s order granting summary judgment to the Earlham Board of Adjustment in an action alleging that the Board illegally granted a zoning variance to a cooperative company to expand its grain bin operation within the city limits.
In a case that should remind all executors that their duty is to maximize the value of the estate for the benefit of beneficiaries, the Iowa Court of Appeals has reversed a district court order that approved the sale of estate property and denied removal of an executrix for self-dealing.
The Iowa Court of Appeals recently affirmed a district court’s judgment declaring a disputed roadway to be public and enjoining the defendant from harassing his neighbor concerning her use of the road in the future.
We have covered the Foreign Bank and Financial Accounts (FBAR) requirements at the tax schools during the past couple of years. Those rules require U.S.
The Iowa Supreme Court recently reversed a jury verdict in favor of flooded homeowners, finding that the homeowners had not shown that the City of Ottumwa’s negligent management of storm water caused the flood that devastated their home.
On April 30, 2014, the IRS released the final regulations providing guidance to providers of Minimal Essential Coverage (MEC) subject to information reporting requirements under the Affordable Care Act.
The Office of Inspector General (OIG) has released a 2013 fiscal year audit report of the United States Department of Agriculture (USDA) that is run by Secretary Tom Vilsack.
On April 27, 2014, IRS released a draft of the new, four-page Form 1023EZ, “Streamlined Application for Recognition of Exemption Under Section 501(ϲ)(3) of the Internal Revenue Code.” This is a major change in the application for non-profit 501(ϲ) (3) status. The three page form is a vast improvement compared to the existing Form 1023 which is over 25 pages in length. A new streamlined process for the Form 1023-EZ will also allow the IRS to concentrate more on compliance for I.R.C. §501(c)(3) organizations.
The net investment income tax (NIIT) is a 3.8% additional tax for individuals with adjusted gross income (AGI) greater than $200,000 ($250,000 for married couples filing jointly). Net investment income for this purpose includes interest, dividends, annuities, rents and royalties, plus passive income from a trade or business activity, and income from the trade or business of trading in financial instruments and income from the trade or business of trading in commodities.
The Agricultural Act of 2014, also known as the 2014 Farm Bill, was signed into law on February 7, 2014. The Act repeals certain programs, continues some programs with modifications, and authorizes several new programs administered by the Farm Service Agency (FSA).
The North Carolina Court of Appeals has affirmed a North Carolina Industrial Commission (Commission) order denying damages to plaintiffs in a negligence action against the North Carolina Department of Agriculture and Consumer Services (the “Department”) stemming from an E. coli outbreak at a state fair petting zoo.
The Iowa Court of Appeals has affirmed a jury verdict against a nephew and his wife in their action seeking to set aside a decedent’s will on the grounds that it was the product of undue influence by the nephew’s siblings.
Millions of consumers began receiving national mortgage settlement payments last year. The tax treatment of those payments depends on the taxpayer’s circumstances, but a letter accompanying the payment (summarized below) should provide some guidance.
Most electrical energy is transmitted throughout the county via high voltage overhead transmission lines. Most of these lines transmit high voltage alternating current. Newer renewable energy projects, however, require high voltage direct current lines, which allow energy to be transmitted efficiently over longer distances.
The IRS has changed the processing of extensions this year. Consequently, it is crucial to electronically file as many as possible. Filing by paper may result in delayed refunds or improper penalty assessments.
If it is necessary to send on paper, send each paper extension in a separate envelope. WHY? When you send a group many times only the top one is stamped as the received date – the postmark on the extension. The rest are all stapled together and sometimes not even processed. Or, they do not have the stamp of the postmark date and they are not considered timely filed.
As we all prepare for the final days of filing season, here are the important due dates and other information needed for rejected e-filed returns to be considered timely filed.
Resubmission of Rejected Tax Returns
The Florida Supreme Court has refused to reform a pre-printed will lacking a residuary clause to devise after-acquired property to the stated beneficiary. The case points out the perils of using pre-printed legal forms.
The Iowa Supreme Court has ruled that the creation of a relationship between an attorney and an executor of a decedent’s estate does not impose a duty on the attorney to protect the personal interests of the executor
The U.S. Tax Court has ruled that trusts can qualify for the real estate professional exception to the rule that rental activities are per se passive.
The Iowa Court of Appeals has determined that “rain” is not “rainwater” when interpreting an insurance policy coverage exclusion.
The Center for Agricultural Law and Taxation does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. The Center's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.