We love writing this blog. Hopefully we educate folks and offer solid general advice to help taxpayers understand sometimes complex and arcane provisions of the U.S. Tax Code. Admittedly, some aspects of the tax code are as clear as mud while others are so complex as to require hundreds of pages of forms, regulations and instructions. Today, however, we simply want to have some fun with this tax post.
The recent outcry over tax inversions – situations in which a U.S. corporation purchases a foreign business and then moves certain functions offshore so as to effectively avoid U.S. taxes – has drawn strong feelings from all segments of the political spectrum. Revelations that some billion dollar companies pay no U.S. tax has certainly fired up politicians (and we suspect their speech writers as well).
Witness President Obama who called these arrangements “unpatriotic.”
Those words are actually quite benign. Entertainer Steven Colbert reaction was much more colorful; “it’s like me adopting an African child, then claiming myself as his dependent.”
Want more? Entertainer Jon Stewart said, the practice was equivalent to “gender reassignment” for corporations.
Perhaps the best statement comes from Sen. Ron Wyden (D Oregon). Without mincing any words, Wyden said, the U.S. Tax Code is a “rotting economic carcass that’s infected with chronic diseases like loopholes and inefficiencies”. You can also listen to his complete remarks here.
We understand that the tax code is extremely unwieldy and complex. Not once in any tax trial have I ever had an IRS employee testify that they have read the code from cover to cover. It has become so large that when added to regulations, forms, rules and instruction booklets it is probably an impossible task for most.
There is some dark humor in the above quotes; it is funny unless you are facing an audit or criminal tax investigation. Ditto if you are trying to find ways to save your company money without running afoul of some hidden section of the tax code. When it’s time to get serious, give us a call.
Mahany & Ertl is a boutique tax law firm with a global reach. Audit defense, offshore reporting, FBARs, FATCA, criminal tax defense, tax controversy and tax planning; we can help. For more information on what we do, contact a qualified IRS tax lawyer today – for civil questions, contact attorney Bethany Canfield at or by telephone at (414) 223-0464. Have a criminal tax question (tax evasion, failure to file, false return or money laundering)? Contact attorney Brian Mahany at . All inquiries protected by the attorney client privilege.
Hat tip to Yahoo Finance for the great quotes