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Yearly Archives: 2013

The IRS Can Read Your Emails If It Wants.

If you've been swapping emails with your accountant about the best way to avoid paying taxes, be aware: The IRS says it has the right to go into your account and read them.

A report from the American Civil Liberties Union, which filed a Freedom of Information Act request to find out whether the IRS is reading your emails without a warrant.

A bit of background is necessary here. When it comes to getting a warrant to read your email, the relevant law is the Electronic Communications Privacy Act, which was enacted way back in 1986. As you might expect, the law is a bit dated: According to the law, a government agency can read your email without a warrant as long as the email has been opened, or if it's been sitting in your inbox for more than 180 days. Only unopened email that's been on the server for less than 180 days requires a warrant.
aware: The IRS says it has the right to go into your account and read them.

It's exactly the kind of arbitrary distinction you might expect from a law written before email was widely used and understood. And accordingly, a Sixth Circuit appeals court ruled in 2010 that in fact, agencies needed to get a warrant before reading any emails, not just those that were new and unopened.

Before that decision, the IRS was certainly opening emails without warrants -- in fact, the ACLU got hold of an internal handbook claiming that the "the Fourth Amendment does not protect communications held in electronic storage."

The question, then, is whether those practices changed after the Sixth Circuit decision.

The ACLU is calling on the IRS to amend its procedures to bring them in line with the Fourth Amendment. In the meantime, just be aware that the taxman might sift through your inbox if he thinks you're holding something back.
 

Do you Have IRS Problems?

Contact the Tax Lawyers at Marini & Associates, P.A.

for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or
Toll Free at 888-8TaxAid (888 882-9243).

 
Source: 
 
Daily Finance

Read more at: Tax Times blog

CCA Finds That Information Reporting Penalties Are Divisable Taxes For The “Full Payment Rule” for a Refund Suit.

In Chief Counsel Advice 201315017, the IRS has determined that the penalties under Code Sec. 6721 for failure to file an information return and Code Sec. 6722 for failure to furnish a correct payee statement are divisible taxes for purposes of establishing refund suit jurisdiction.
 
The penalties are calculated on a per-transaction basis, and the penalties are waived on an individual basis if the failure at issue is due to reasonable cause and not willful neglect.
 
To meet the jurisdictional requirements of a refund suit, a taxpayer must generally make full payment of assessed taxes due before the matter may be adjudicated. See Flora, 362 U.S. at 177. In general, the partial payment of assessed taxes or a proposed deficiency is insufficient to support refund suit jurisdiction. Id. 
 
The majority opinion in Flora, however, noted that one possible exception to the full payment rule might exist where certain “tax assessments may be divisible into a tax on each transaction or event, so that the full-payment rule would probably require no more than payment of a small amount.” Flora, 362 U.S. at 175-78, n.38. The Court was referring at that time to excise taxes. The Court’s analysis, however, hinged divisibility on a tax being levied on each transaction or event.
 
The CCA found that the Code Sec. 6721 and Code Sec. 6722 penalties are divisible penalties. Therefore, Taxpayer was only required to pay the divisible amount of the penalty attributable to a single failure before filing a refund claim and instituting a refund suit under Code Sec. 7422.

Disagree with the IRS' Assessment of an Exercise or Withholding Tax?

Want to Pay for 1Incident or 1 Transaction and Sue in Court Of Claims for Refund?

Contact the Tax Lawyers of Marini & Associates, P.A.

for a FREE Tax Consultation at: www.TaxAid.us or www.TaxLaw.ms or
Toll Free at 888-8TaxAid (888 882-9243).
 
 

Read more at: Tax Times blog

More Unbelievable FBAR Penalties Cases!

A 1500% penalty rate on the taxes avoided/FBAR penalty, is imposed in a California case.

  • Is a 1500% penalty constitutionally permissible?
  • Of course the Defendant knowingly and voluntarily plead guilty, but should the IRS CID even be able to have the leverage to force someone to this type of penalty?


 

FBAR: Isreal & Luxemborg a warning for unreported foreign accounts

Read more at: Tax Times blog

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