“Will I get caught?” is one of the most common questions asked by potential tax cheats. The temptation to cheat the IRS is overwhelming for thousands of Americans. While no one knows whether and when they will be caught, the IRS has become much better at finding those who evade taxes. One of the best […]
Thinning the Herd: IRS Plans 2,500 Preparer Inspections
[Updated April 2020] The IRS has identified 10,000 tax return preparers who they say make too many errors. Errors that ultimately cost their clients money. The IRS plans to visit approximately 2,500 of those preparers over the next several months. Many people use professional tax preparers for their returns. Wealthier individuals often use CPAs while […]
Internal Audit Post: Oneida Tribe Pays Property Taxes – Twice
The Oneida Tribe of Indians is a sovereign tribal government occupying 102 square miles of land near Green Bay, Wisconsin. Like most federally recognized tribes, The Oneidas are exempt from local property taxes. A recent internal audit stemming from the tribe’s housing authority revealed the tribal government had improperly paid county property taxes for years. […]
Bad Tax Policy – California's Retroactive Tax Levy
We represent many businesses – everything from local “mom and pops” to a Fortune 150 company. What is the single biggest problem facing such a diverse group of business taxpayers? Bad tax policy; especially the lack of predictability and consistency. If you ask the general public what’s wrong with the tax system you are likely […]
Offshore Tax Evasion Update – By The Numbers
We frequently post stories about both Americans and foreign bankers prosecuted for tax evasion involving unreported offshore accounts. U.S. taxpayers are usually prosecuted for filing a false tax return (a 3 year felony) or failure to file an FBAR (5 years). Bankers, lawyers and accountants associated with these taxpayers are frequently charged with conspiracy to […]
Abusive Tax Shelter Results In $100 Million Assessment (IRS Whistleblower Post)
None of us enjoy receiving letters from the IRS. Some might argue and claim a refund is a nice thing to receive from the IRS but those checks come from the U.S. Treasury. While often a letter from the IRS signals an audit or notice saying that you owe more money, former HP board member […]
Top Tax Scams – Are You On The IRS' Radar?
by Brian Mahany With just 2 weeks before taxes are due, the IRS has cranked up their publicity machine. Indictments, public service announcements and lots of information. One of the more interesting stories is the IRS “dirty dozen” tax scams. While identity theft occupies the number 1 spot again, several “scams” warrant special mention. Near […]
New Directive Says IRS Can Seek Metadata
An Information Letter Memorandum issued by the Chief Counsel of the IRS (ILM 201146017) says the IRS can summons metadata from taxpayers. Just about everything we do on a computer carries a trail of metadata. This stored information tells how data was formatted, modified and created. For those not familiar with metadata, we take our […]
America's Tax Gap – Who Is At Fault And What Should We Do About It
by Brian Mahany America’s tax gap – the difference between what the IRS collects and what it should collect. Estimates differ widely but everyone agrees that it is measured in the hundreds of billions of dollars annually. In the last comprehensive study, the IRS estimated it collects 84% of what is due each year. President […]
U.S. Tax Court Disallows 419A Plan, Upholds Penalties
In a recent U.S. Tax Court case, taxpayers suffered a double loss. The taxpayers, consisting of four couples, had purchased welfare benefit plans marketed by Benistar 419 Plan Services. Under the plan, Benistar provided preretirement life insurance to select employees of companies enrolled in the plan. Small employers like the plans because they allow pretax […]