February, 2017 - NCBarBlog

Section 212(3) of the Code provides in pertinent part: “In case of an individual, there shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in connection with the determination, collection, or refund of any tax.”

The reach of the above provision is very broad. The deduction is available whether the taxing authority is the United States, a state, a municipality or a foreign country. “Any tax” is all encompassing and includes income, estate, gift, excise, property, sales and use, and any other taxes. As stated in Treas. Reg. § 1.212(l): “Thus, expenses paid or incurred by a taxpayer for tax counsel or expenses paid or incurred in connection with the preparation of his tax returns or in connection with any proceedings involved in determining the extent of tax liability or in contesting his tax liability are deductible.” Such expenses or professional fees include, among others, the preparation costs of a request for a private letter ruling or appraisal fees to determine the amount of a casualty loss deduction or a charitable contribution deduction. Thus, it does not have to be a contested tax situation to qualify – the expense only needs to arise “in connection with the determination of any tax.” See Carpenter v. United States, 338 F.2d 366 (Ct. Cl. 1964) (where taxpayer incurred legal expenses in ascertaining that substantial support payments to his former wife constituted taxable alimony to her and therefore were deductible by him). Also, it does not matter whether the taxpayer is successful in contesting the purported tax liability; he can lose the controversy with the taxing authority and still deduct the related expenses.

Life After Obamacare?

Health Law Section

By Marcus C. Hewitt
and Natalma “Tami” McKnew

In the wake of the 2016 presidential election, the healthcare industry is coping with the uncertainty of a new administration, especially in light of the President’s repeated pledges to repeal and replace the Patient Protection and Affordable Care Act (“PPACA” or “Obamacare”). A repeal could affect every corner of healthcare in the United States, and those implications will become clearer in the coming months. This article anticipates what form a repeal might take, and some implications for ACOs and Medicaid providers in particular.

Partial vs. Full Repeal

Regardless of campaign rhetoric, a sudden, outright repeal of PPACA is unlikely. Without a 60-vote supermajority in the Senate, a full repeal bill could be blocked by filibuster.¹ Moreover, simply repealing the law midway through the 2017 coverage period without a transition period or provision for a delayed effective date would create chaos and potentially strip millions of ACA plan members of coverage overnight, while reviving insurers’ ability to decline to insure those with pre-existing conditions or other risk factors. It would also potentially deny Medicaid coverage to millions in states where Medicaid was expanded since 2014. In fact, President Trump said in his first post-election interview that, while he prioritized moving quickly on Obamacare, he would consider leaving some parts of the law intact and that he liked certain provisions of the law.²

Pretrial Justice and Criminal Case Management Reform

Featured Posts

By Robert C. Kemp III

One of the greatest honors in my professional career was serving on the N.C. Commission on the Administration of Law and Justice. As a member of the commission, I was assigned to the Committee on Criminal Investigation and Adjudication. Two of the topics we focused on were pretrial justice and criminal case management.

Although various methods of pretrial release exist in North Carolina, a secured bond is the most common form of release for a person charged with a criminal offense. Few defendants can afford to post the bail amount in full. Some defendants utilize bail bondsmen, who charge a percentage of the total bond amount in exchange for obtaining the defendant’s pretrial release. Unfortunately, many defendants cannot afford either option and are forced to remain in jail. Most such defendants are also unable to retain counsel and are instead represented by court-appointed counsel, such as a public defender.