INCOME TAX

Ct. D. 2080, page 850. Gross income; litigant’s recovery includes attorney’s contingent fee. The Supreme Court holds that when a litigant’s recovery constitutes income, the litigant’s income includes the portion of the recovery paid to the attorney as a contingent fee. Commissioner of Internal Revenue v . Banks.

Rev. Rul. 2005–23, page 864. Federal rates; adjusted federal rates; adjusted federal long-term rate and the long-term exempt rate. For purposes of sections 382, 642, 1274, 1288, and other sections of the Code, tables set forth the rates for April 2005.

T.D. 9190, page 855. Final regulations under section 664 of the Code concern the ordering rule of regulations section 1.664–1(d). The regulations provide rules for characterizing the income distributions from charitable remainder trusts (CRTs) when the income is subject to different federal income tax rates. The regulations reflect changes made to income tax rates, including capital gains and certain dividends, by the Taxpayer Relief Act of 1997, the Internal Revenue Service Restructuring and Reform Act of 1998, and the Jobs and Growth Tax Relief Reconciliation Act of 2003.

T.D. 9191, page 854. Final regulations amend regulations under section 163(d) of the Code to provide the rules relating to how and when taxpayers may elect to take qualified dividend income into account as investment income for purposes of calculating the deduction for investment income expense.

Finding Lists begin on page ii.