On March 19th, Law360 published an article by our colleagues Casie Collignon and Jennifer Benda titled “Tea Party v. IRS: Tax Trouble or Class Action Nightmare?” The article addresses growing litigation by tea party groups arising out of the alleged additional scrutiny the IRS applied to the groups’ petitions for tax-exempt status as 501(c)(4) social welfare organizations. While the press has covered these stories as being … Continue Reading
The IRS recently filed a motion to dismiss class action claims brought by Tea Party groups. In NorCal Tea Party Patriots, et. al. v. IRS, et. al., S.D. Ohio, Case No. 1:13-cv-00341, Tea Party groups asserted that the IRS singled out their organizations when those organizations sought exemption from taxation pursuant to Section 501(c)(4) of … Continue Reading
On March 15, 2013, the IRS issued a private letter ruling responding to a request for a determination of whether incentive awards paid to class representatives under a settlement agreement resolving a class action suit against an employer under the Fair Labor Standards Act were wages for employment tax purposes. In the Ruling, the IRS … Continue Reading
When finalizing class action settlements, or paying damage awards after a class action judgment, it is important to be mindful of the taxation of these payments and the related IRS information reporting requirements triggered by these payments. In general, businesses and persons engaged in a trade or business are responsible for filing Form 1099-MISC to … Continue Reading
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