Certain arguments made by taxpayers in the past have been determined to have no validity in the law and, thus, are deemed to be “frivolous.” As such those who continue to advance them can be subject to a penalty of $5,000. There is an IRS list of 46 frivolous arguments. New to the list are the following:
Gross income less allowable adjustments, such as IRA, alimony, and Keogh deductions. AGI determines whether various tax benefits are phased out, such as personal exemptions, itemized deductions, and the rental loss allowance and modified adjusted gross income (MAGI).