A New Jersey law firm that paid an estate client’s $305,000 penalty and interest for filing a late tax return won the money back Tuesday by convincing a federal judge that the Internal Revenue Service shouldn’t have assessed the penalty in the first place.

U.S. District Judge Dennis Cavanaugh in Newark, N.J., ruled that the IRS abused its discretion when it refused to grant a one-month extension in 2006 and accept the late filing by Morristown, N.J.’s McElroy, Deutsch, Mulvaney & Carpenter.

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