April 2012 archive

Filmmaker wins key victory in deducting losses

In T.C. Memo 2012-115 (April 19, 2012), a taxpayer won a notable tax case involving the hobby loss rules. The Tax Court framed the issue as follows:  We must decide whether petitioner’s documentary film production activity was a trade or business or a labor of love. Respondent asserts that Smile ‘Til It Hurts was the …

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A massive sample size should invite a critical eye, not instill confidence

This post is part of a series that considers methodological and reporting flaws that frequently arise in surveys, and uses Travelandleisure.com’s “America’s Favorites Cities” (AFC) survey as its primary point of discussion. Links to other posts in this series are featured on the author’s page. Reports will frequently boast a survey’s sample size, as if …

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Specific Language is Important in Agreements

A Manhattan Judge dismissed a lawsuit brought by Howard Stern again Sirius XM Radio Inc.  The lawsuit centered around Stern’s claim that the company owed him stock awards for helping Sirius achieve specific subscriber counts.  Stern claims he was owed $300 million and his agent, Don Buchwald, an additional $30 million in stock.  Stern’s original …

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Over $30 Million Allegedly Misappropriated from City Funds

Rita Crundwell, longtime comptroller of Dixon, Illinois, is alleged to have defrauded the city of over $3 million in the last few months and misappropriated $30 million over the last six years.  The town of Dixon is small, with a population of under 16,000. Crundwell lived a luxurious lifestyle that exceeded her $80,000 annual income.  …

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AOL Surprise Sale Shows the Value of Mapping Technology

AOL recently announced the sale of over 800 patents and patent applications to Microsoft, and a non-exclusive license covering the rest of its retained patent portfolio. The sale price is $1.056 billion in cash. The sale includes the stock of an AOL subsidiary, which allows AOL to offset the patent sales against a loss involving …

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GSA Whistleblower Testifies Regarding Government Waste

There has been a great deal of discussion regarding the approximately $800,000 spent on a lavish 2010 Las Vegas conference hosted by the General Services Administration (GSA).  The GSA handles government real estate and other non-military procurement.   Susan Brita, a GSA deputy administrator, was the whistleblower who first raised the issue, which has since …

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Reebok agrees to pull Tebow apparel from shelves in licensing dispute

Reebok and Nike have reached a settlement in their dispute over sales of Tim Tebow merchandise.  Nike had filed suit in March, alleging that Reebok was improperly selling sporting apparel referencing the football superstar’s new team affiliation (Tebow was traded from the Denver Broncos to the New York Jets in March). Nike asserted that it …

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IRS to use tax preparer data to identify patterns of fraud

The IRS has registered over 840,000 tax return preparers and has begun the process of administering competency tests for those who are not a CPA, attorney or enrolled agent.  Paid preparers who fall outside of these three groups will also be required to take 15 hours of continuing professional education annually from IRS-approved vendors.  IRS …

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Who is being polled matters

With the Republican primary  wrapping up and more attention placed on the national election, people are focusing on poll results.   Real Clear Politics (RCP), a well-known website that provides a plethora of poll results, just updated its summary of multiple polls’ results related to the general election:  Obama vs. Romney.    See summary table below.  Most …

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Case provides primer on regression analysis and what can go wrong

After a jury trial, ATA Airlines (ATA) won a nearly $66 million verdict against Federal Express Corporation (FedEx). FedEx appealed that ruling. In ATA Airlines, Inc. v. Federal Express Corp., No. 11-1382 (7th Cir. Dec. 27, 2011), a distinguished panel consisting of Justices Easterbrook, Posner, and Wood criticized the complex damages analysis accepted by the …

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