A wholesale purchaser and reseller of vape and tobacco products is contesting $6.5 million in taxes and penalties after the IRS said the company didn’t disclose enough of its accounting.
Woodbridge, Va.-based Potomac Vape Inc., which also goes by Potomac Distro, petitioned the US Tax Court saying the IRS “prematurely assessed” a $3.68 million tax deficiency for its 2021 tax year, as well as a $2.76 million civil fraud penalty under IRC Section 6663.
An IRS notice disclosed with the Nov. 5 petition shows the agency alleged that Potomac Vape didn’t provide substantiation for its cost of goods sold, ...
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