In a recent Law360 article by Amy Lee Rosen entitled “5 Federal Tax Cases To Watch In The 2nd Half Of 2020,” Robert M. Russell discussed the anticipated importance of U.S. v. Altaba, an atypically early tax dispute presently taking off in Delaware district court.
Excerpts from the article are below:
Robert M. Russell, a tax counsel at Kostelanetz & Fink LLP and adjunct professor of international tax controversies at Georgetown University Law Center, told Law360 the case is important because of its procedural posture.
"It's in court because of the dissolution of the entity, so because of that, the government had to move forward to protect their interest before the dissolution occurred," he said. "So they had to put everything out there to protect their interests."
Normally a company can contest a tax bill by filing a petition with the U.S. Tax Court or can pay the tax and then file a complaint in a federal district court challenging the tax assessment, which can take a long time, Russell said. But in Altaba's case, certain new international provisions in the Tax Cuts and Jobs Act, such as those on GILTI and foreign tax credits, which would usually take a few more years to get into the court system, are coming to the forefront a bit earlier, he said.
"There are some very interesting and new areas raised in the complaint that, due to the procedural posture of the dissolution, are finding their way into court much earlier than the normal timeline for these issues would predict," Russell said. "But because of that, those all may go away and get resolved, but to see them in black and white in a court document is new."
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