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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.

May 12, 2014 | Roger A. McEowen

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

May 9, 2014 | Breandan Donahue, Estate Planning Attorney, Goosmann Trust Law Counsel

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,
or SLAT.

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.

April 8, 2014 | Kristy S. Maitre

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.  

April 4, 2014 | Roger A. McEowen and Kristine A. Tidgren

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.

April 3, 2014 | Kristy S. Maitre

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

April 1, 2014 | Kristine A. Tidgren

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 Iowa Court of Appeals has ruled that adverse possession can be established, even if the possessor of the property came to the property with permission.

The Iowa Court of Appeals has affirmed that dog owners, pursuant to Iowa Code §351.28, are strictly liable for damages done by their dogs. The court ruled that the owner’s knowledge of a dog’s propensity to be vicious is not an essential element of claims against dog owners.

The IRS has extensively revised the electronic signature methods for Forms 8878 and 8879.  These updates will be published in New Publication 1345 which is currently not on the IRS website, but will be posted soon.  We will post a link to this publication when it becomes available.

March 24, 2014 | Kristy S. Maitre

A recent Tax Court opinion has thrown IRA rollover issues into question. In Bobrow v. Commissioner, T.C. Memo 2014-21, the Tax Court construed I.R.C.§408(d)(3)(B) to limit the frequency of nontaxable rollover contributions to a once-per-year limitation. 

March 21, 2014 | Kristy Maitre

The time and place of examination pursuant to the provisions of I.R.C. §§ 6420(e)(2), 6421(g)(2), 6427(j)(2) or 7602 are to be fixed by an IRS officer or employee. IRS officers and employees are to endeavor to schedule a time and place that are reasonable under the circumstances. However, it may be possible to transfer an audit in certain situations.  The article provides guidance on requesting an audit transfer.

The District Court for the Northern District of Illinois has ruled that the definition of “owner” for purposes of Farm Service Agency (FSA) payments through the Direct and Counter Cyclical Payment Program (DCP) does not include the beneficial owner of an Illinois Land Trust.

The Iowa Court of Appeals has affirmed a Winneshiek County District Court ruling, finding that purchasers of an 80-acre tract of land established title to a connected 2.9 acre disputed parcel through adverse possession.

March 12, 2014 | Roger A. McEowen

In rural/urban fringe areas, cases sometimes arise involving nuisance-related issues associated with livestock.  A common scenario is for a rural landowner on a small acreage to maintain farm animals in close proximity to other rural residences.  In these situations, local zoning laws may come into play in addition to the state's Right-To-Farm law.  In a recent Michigan case, the landowners owned a 1.5-acre parcel on which they had their home.  They also kept goats, pot-bellied pigs, chickens and rabbits in their back yard.  The tract was in an area zoned R-1 residential, and under Michigan

In an 8-1 decision, the United States Supreme Court has reversed the Tenth Circuit Court of Appeals to find that fee simple ownership of an abandoned railroad right of way vested in the owner of the surrounding tract, not in the United States, which had claimed a reversionary interest.

When a partner sells or exchanges his partnership interest, the partner generally recognizes a capital gain or loss on the sale. The exception to this rule is where the amount received by the partner is attributed to unrealized receivables or inventory.

The Kansas Supreme Court recently overruled long-standing case law and declared that the assumption of the risk doctrine is no longer a complete bar to recovery in a farm employee’s personal injury action against an employer.

In re Woods, No. 12-1111, 2014 U.S. App. LEXIS 2960 (10th Cir. Feb. 19, 2014), rev'g. bankruptcy court opinion and B.A.P. opinion reported at 65 B.R. 196 (B.A.P. 10th Cir. 2012)

The Iowa Court of Appeals recently settled a neighborhood dispute, ruling that all neighbors had the right to use a roadway that was designed to benefit the neighborhood.

The Iowa Court of Appeals has affirmed that a mall owner owed no duty to its customers to remove snow and ice from sidewalks where a “continuing storm” did not provide the owner with a “reasonable opportunity” to remedy the condition.

Medicaid is the joint federal/state program that pays for long-term health care in a nursing home. A Medicaid recipient must meet numerous eligibility requirements but, in short, must have a very minimal level of income and assets.  State law typically allows the state Medicaid agency to file a claim in a deceased Medicaid recipient’s estate to recoup Medicaid benefits paid during the recipient’s lifetime, and also authorizes a statutory lien to the extent of Medicaid benefits paid.

The United States Court of Appeals for the District of Columbia Circuit has ruled that 31 U.S.C. Sec. 330 does not grant the IRS authority to regulate tax return preparers. In so finding, the Court of Appeals affirmed the January 18, 2013, District Court for the District of Columbia decision analyzed here.

The IRS has reconfirmd that changes in business structure won't  necessarily accelerate installment payment of federal estate tax. Read Roger McEowen's legal brief on this subject below.

A federal district court in the Northern District of Iowa recently allowed two breach of contract claims to survive summary judgment in an action brought by two Iowa hog producers against a Minnesota meat processing company.

February 4, 2014 | Roger A. McEowen

On January 31, the U.S. House passed H.R. 2642, the “Agricultural Act of 2014” on a 251-166 vote.

The Tax Court has invalidated part of IRS Pub. 590, ruling that the one-year rule applicable to a taxpayer's ability to make a nontaxable rollover contribution to an IRA is not specific to any single IRA of a person, but applies to all of that person's IRAs. 

A recent federal case from the Middle District of Pennsylvania highlights the importance of carefully negotiating and reviewing terms within conservation easements so as to fully protect landowners’ interests.

A magistrate judge for the United States District Court for the District of Oregon has recommended vacating consent judgments entered into between two blueberry growers and the United States Department of Labor (DOL). 

In a third appellate decision for the same case, the Iowa Court of Appeals has ruled that a homebuilder was excused from substantial performance and was entitled to foreclose its mechanic’s lien against a partially-completed home.  

A residuary beneficiary was a big winner after the Iowa Court of Appeals reversed a district court’s total invalidation of a will on undue influence grounds.

An Idaho federal district court recently issued a preliminary injunction preventing the U.S. Army Corps of Engineers (“the Corps”) from enforcing a 40-year-old regulation restricting the possession of loaded firearms and ammunition on Corps-administered property.

The Iowa Court of Appeals has found that a member of an LLC was not personally liable for the debt of the LLC, even though the lender contended that it had extended credit to a partnership and not to the LLC.