Tax Controversy and Litigation

We have a long history of advising and representing clients in tax audits and disputes before national and local offices of the IRS, before state and local tax agencies and appeal divisions, and in state and federal courts. Our cases often address complex and novel tax issues that set precedent and decide important industry issues. Our cases involve:

• major petroleum industry issues
• precedent-setting estate tax valuations
• partnership taxation
• international transfer pricing
• foreign tax credits
• Report of Foreign Bank and Financial Accounts (FBAR)
• Foreign Account Tax Compliance Act (FATCA) and international tax issues
• Foreign Investment in Real Property Tax Act (FIRPTA) compliance matters
• tax-exempt disputes
• collection due process disputes
• Employee Retirement Security Income Act of 1974 (ERISA) and other employee benefits/executive compensation matters
• valuation issues
• domestic and foreign reorganizations of corporations and financial institutions
• penalty and interest issues

Many of our cases have gained national attention due to their significant impact both for our clients and for taxpayers in general. As part of Holland & Knight's preeminent energy industry practice, our team has a long history of successfully representing petroleum, hard minerals and natural resources clients.

Holland & Knight is consistently ranked as one of the top tax law firms in the United States. As evidenced by numerous rankings and awards, media mentions and leadership positions, our tax controversy and litigation attorneys are recognized leaders and authorities in the field. We have been recognized and ranked in U.S. News – Best Lawyers® "Best Law Firms," Chambers USA, The Best Lawyers in America® and The Legal 500 United States, among others. The firm received a Band 3 ranking in U.S. Taxes: Contentious in the 2021 The Legal 500 United States guide. In the same category, Partner Mary McNulty was named among Leading Lawyers and Partner Lee Meyercord was listed among Next Generation Partners. In addition, the firm earned a Band 4 ranking in U.S. Taxes: Non-Contentious in the 2021 The Legal 500 United States guide.

Our backgrounds include invaluable experience as senior executives in the IRS Office of Chief Counsel, the U.S. Attorney's Office and the U.S. Department of Justice's Tax Division. We regularly team up with our trial attorneys in cases litigated in federal district courts and appellate courts.

Recent Engagements

While our history in the successful resolution of tax disputes runs deep, more recent examples of our representation include:

• Served as special tax counsel in connection with the largest non-financial bankruptcy in U.S. history, with multibillion-dollar tax issues relating to the bankruptcy restructuring and IRS proposed tax adjustments
• Represent a multinational corporation in a tax refund suit involving over $1.5 billion in tax and penalties
• Prevailed in a case of first impression holding that guarantee fees paid to the foreign parent of a U.S. subsidiary is foreign source income exempt from U.S. withholding tax
• Prevailed in a landmark judgment affirmed by the U.S. Court of Appeals for the Tenth Circuit establishing that the costs of drilling offshore exploratory oil wells are deductible as intangible drilling and development costs
• Prevailed in the U.S. Tax Court in a case involving determination of the transfer price of Saudi Arabian crude oil, in which the alleged deficiencies totaled billions of dollars; the U.S. Court of Appeals for the Fifth Circuit affirmed, and the U.S. Supreme Court declined to hear the case on appeal
• Prevailed in the U.S. Court of Appeals for the Third Circuit in a case for a major oil company involving platform intangible drilling costs, the allowance of foreign tax credits based on ownership of an economic interest in Iran and the effective transfer date of a foreign farmout
• Settled a multibillion-dollar federal excise tax case involving the transfer of property by a large domestic energy corporation client to its foreign subsidiary
• Prevailed in the U.S. Court of Appeals for the Federal Circuit in a case involving the deductibility of payments made to the Agent Orange settlement fund
• Prevailed in the U.S. Tax Court in a case involving whether or not an foreign individual was a U.S. income tax nonresident and thus was not taxable in the U.S. on a worldwide basis
• Seeking a $3 million-plus refund after successfully settling litigation between beneficiaries and a judicial modification of a trust
• Successfully litigating on foreign tax credit (FTC) for taxes paid in France on French source income on behalf of a dual citizen, resulting in IRS conceding the issue
• Defending a dual national client against a $16 million IRS FBAR penalty
• Successfully negotiated a 94 percent reduction in a client's tax liability, including elimination of all accuracy-related penalties
• Represented a client through income tax examination, which resulted in penalties totaling nearly $1 million being assessed; successfully appealed the examination to have the penalties reduced to $15,000
• Working with IRS to achieve a closing agreement under which a Native American Tribe modified its retirement plan to come into compliance with the Internal Revenue Code
• Advising Tribe through an IRS audit of its employment tax and backup withholding obligations
• Represented U.S. corporation with approximately a dozen unreported foreign subsidiaries in voluntary disclosure matter, resulting in reduction of $2 million in penalty exposure
• Resolved multiyear IRS examination involving a disallowed business bad debt deduction, resulting in a 90 percent concession in taxpayer's favor
• Litigated multiple U.S. Tax Court and U.S. Court of Appeals cases involving U.S. Virgin Islands residency issues, including handling the first Tax Court case to rule that bona fide U.S. Virgin Islands residency was established
• Represented Swiss-based banks with respect to Category 2 (non-prosecution agreements) and Category 3 (non-target letters) commitments under the Swiss Bank Program
• Successfully represent large corporations in the U.S. Court of Federal Claims and IRS administrative proceedings involving multimillion-dollar interest claims on federal tax deficiencies and refunds
• Prevailed in the Tenth Circuit in a case involving whether a copper mining company's solvent extraction and electrowinning processes applied to produce 99 percent pure copper cathodes were mining treatment processes
• Prevailed in the U.S. Tax Court on a multimillion-dollar administrative adjustment request for a partnership refund, which involved complex partnership litigation procedural issues
• Representing a tax matters partner in a U.S. Tax Court case involving a novel self-employment tax issue
• Successfully litigated and defended privilege claims in federal district courts in motions to quash IRS third-party summonses
• Represented families in IRS appeals and litigation in estate and gift tax valuation cases, including a significant Fifth Circuit victory on the valuation of stock of a closely held corporation
• Obtained a landmark decision in the U.S. Court of Federal Claims about whether certain capital gains were properly distributable net income
• Represented taxpayers in Freedom of Information Act requests, appeals, mediation and lawsuits
• Represent an international company in an IRS audit and competent authority proceeding involving transfer pricing issues
• Resolved an audit and IRS administrative appeal for a private foundation that faced loss of its exempt charitable organization status and millions in back taxes, with no change to the client's returns or tax status and no additional taxes imposed
• Prevailed in a New York State Division of Tax Appeals case described on the front page of the New York Law Journal as "potentially pivotal," addressing whether the mere presence of a product in the state is sufficient to subject a company to tax liability