Yearly Archives: 2019

The US Internal Revenue Service has set up a criminal investigation team to investigate whether Bitcoin and other cryptocurrencies are being used to evade taxes, according to news agency Bloomberg.

The U.S. Internal Revenue Service, fresh off its success in uncovering U.S. assets hidden in Swiss banks, has assigned elite criminal agents to investigate whether Bitcoin and other cryptocurrencies are being used to cheat the taxman.

A new team of 10 investigators is focusing on international crimes. In addition to following undeclared assets that are flowing out of Swiss banks after a crackdown, it will also build cases against tax evaders who use cryptocurrency.
 

Is Also Attracting Tax Cheats, The IRS Has Said.

The unit is focusing on how users convert cash to cryptocurrency and back again. Cryptocurrencies are taxed in the US as non-cash property whose gains are either capital or income, says US law firm Proskauer Rose. The same is true of Canada.

 Have a Criminal Tax Problem?

 

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for a FREE Tax Consultation Contact Us at:

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or Toll Free at 888-8TaxAid (888 882-9243).

The TIGTA issued it's report on September 27, 2019 stating that the Internal Revenue Service isn’t effectively auditing corporations, despite a change in policy on how the agency was to conducts tax examinations, that was supposed to make the process more efficient.

The LB&I Division initially set expectations that campaigns would significantly overtake traditional inventory selection methods. As of September 2018, only 6 percent of inventory had been generated by campaigns, with this percentage climbing to 15 percent by February 2019.

Initial campaigns were not focused on the most significant compliance issues facing the IRS. Some issues were selected from employee suggestions. Other issues were chosen because there was a compliance plan developed, with training already in place, or existing base of himknowledge available.

TIGTA found that issues for campaigns were not selected or prioritized based on past compliance results or potential impact on compliance. While it is early to assess the overall results of campaigns, the limited results available suggest that the LB&I Division’s limited resources would be better utilized working issues selected based on compliance risk. 

The remaining audits are coming from old processes that take more time and cost more for the IRS to conduct. The agency in 2016 announced a new system for selecting cases to audit. The IRS said it would focus on examining high-risk transactions, rather than auditing a company’s entire tax return as part of an effort to more efficiently enforce tax laws.

The IRS is also failing to use the results of past audits to select and prioritize future cases to examine, the report said. The agency said it is using data to manage its audit caseload and that initial results shouldn’t be used to scrap the program. “We agree that these results, also described by IRS management as lackluster, should not be used to assess the success or failure of the program as a whole,” the IRS Office of Audit said in response to the Inspector General analysis.

“Given the diminished examination resources, the IRS should be even more focused on emphasizing areas that have the highest compliance risk,” the report said.

The IRS also said that staff and resources were allocated to work on implementing the 2017 tax law in 2018 and 2019, directing funds away from the audit program.

This isn’t the first time the IRS has received a negative report about how it is auditing corporations. In September, the Inspector General released a report saying IRS employees had collectively spent nearly 28,000 work days over a four-year period auditing mergers and acquisitions that ultimately yielded no additional tax revenue.

Have an IRS Tax Problem?

 

  
Contact the Tax Lawyers at 

Marini& Associates, P.A. 

 

for a FREE Tax HELP Contact Us at:

www.TaxAid.com or www.OVDPLaw.com 

orToll Free at 888-8TaxAid

The Tax Court has sustained in Roberts, TC Memo 2019-117 the IRS's denial of a request by married taxpayers for a face-to-face Collection Due Process (CDP) hearing. Because the taxpayers failed to participate in the originally scheduled telephone CDP hearing, the Court also sustained IRS's Notice of Intent to Levy.

The IRS assessed a liability for tax, based on the married taxpayers' 2015 return an added applicable penalties, and interest. The IRS then issued to each taxpayer a Notice of Intent to Levy. The taxpayers' representative, a certified public accountant (CPA), timely requested a CDP hearing.

The taxpayers requested an offer in compromise or an installment agreement. IRS acknowledged this request, provided the taxpayers with contact information for someone who could answer any questions they had and assigned a settlement officer (SO) to the case.

The SO determined that the assessment for 2015 was properly made, that notice and demand were properly mailed to the taxpayers' last known address, that the taxpayers did not have any liability for other periods, and that they were in compliance with filing requirements.

On May 23, 2017, the SO mailed a letter to the taxpayers accepting their request for a CDP hearing. The letter stated the date for a telephone hearing and a date for submission of required documentation (including Form 433-A, Collection Information Statement for Wage Earners and Self-Employed Individuals), without which she could not consider collection alternatives, such as an offer in compromise, an installment agreement, or currently-not-collectible status.

The Couple's Representative, A CPA, Was Unavailable When the SO Called on the Hearing Date.

(Not Professional & Not Good for the Taxpayer)

• The CPA later called and requested that the hearing be rescheduled and moved to Houston, Texas. No documentation had been submitted at that time. (Yea right)
• The SO informed the CPA that she could not reschedule or transfer the hearing because the CPA did not contact her before the hearing with a request to reschedule. (the correct and professional thing to do) 

The CPA claimed to have requested a face-to-face hearing prior to the scheduled telephone conference, but had called the information contact originally given to the taxpayers, instead of the SO's telephone number which was on the initial CDP contact letter. (Send an e-fax the next time to document that you contacted the SO).

The CPA requested a face-to-face hearing in Houston on numerous occasions, and the SO informed the CPA on each occasion that the taxpayers did not qualify for a face-to-face hearing. (Do you think SO has had enough of the CPA impossibly thanks that these are stalling techniques?)

The SO informed the CPA that she would permit him to schedule a telephone hearing on July 12, 2017. Prior to that date, the CPA submitted to IRS by fax some financial information, including an unsigned Form 433-A. On the fax, the CPA again requested a face-to-face hearing, which the SO denied on July 14, 2017. On July 28, 2017, the SO issued a Notice of Determination Concerning Collection Action(s) Under Section 6320 and/or 6330 sustaining the proposed levy.

The taxpayers petitioned the Tax Court on August 28, 2017, arguing that a face-to-face hearing will ordinarily be offered to a taxpayer. On June 26, 2018, IRS moved for summary judgment with regard to the 2015 liability. Also on that date, the Tax Court directed the taxpayers to file a response to the motion. No response was filed.

The Court stated that it could grant IRS summary judgment solely based on the taxpayers' failure to respond to the motion, but that summary judgment was also appropriate on the merits.

The Taxpayers Failed To Request A Face-To-Face Hearing Prior To The Date Of The Initially Scheduled Telephone Conference, Did Not Reschedule The Telephone Conference, Did Not Timely Submit Complete Financial Documentation, And Continued To Request A Face-To-Face Hearing.

Therefore, the SO did not abuse her discretion in denying a face-to-face hearing; could not consider collection alternatives; and properly sustained the proposed levy.

This is a Great Example of How Not To Handle A CDP Hearing!

 

Want Your CDP Hearing Professionally Handled?

 

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

 

 

for a FREE Tax HELP Contact Us at:

www.TaxAid.com or www.OVDPLaw.com 

or Toll Free at 888-8TaxAid (888) 882-9243

 



 

A group representing French-American taxpayers said on October 3, 2019 that it had filed a suit against France with the European Commission, hoping to avoid strict US compliance rules that could see them blacklisted by French banks starting in January.　

The "Accidental Americans" association has been battling for years to be exempt from a US demand that all its citizens overseas file bank details along with yearly tax returns.　

The group says thousands of French and other foreigners are deemed Americans because they were born in the US, even though they may have lived there only a few months or years when they were young.　

There are more than 780 ‘accidental Americans’ spread around France, all they have in common is the fact that they are entitled to American citizenship. Some of them had left America in the days after being born in an American hospital. Some of them didn’t even know they were technically American. Some of them don’t even speak English.　

There are estimates that there may actually be as many as 10,000 ‘accidental Americans’ in France, thousands of whom still do not know that they technically have American citizenship, and up to 300,000 across Europe. While formally giving up US citizenship is an option, it can be long and costly.

They want to be freed from the annual filing requirements with the Internal Revenue Service, and from seeing their banks forced to hand over their banking details to the US taxman.　

In 2017, Washington accepted a partial moratorium on the rule, known as the Foreign Account Tax Compliance Act (FATCA), set up to battle offshore tax evasion.

The FIRPTA exemption expire at the end of this year, and the French banking federation FBF has warned that 40,000 accounts could be closed come January if no accord is reached on the filing requirements. In refusing to hand over information required by the United States, French banks would expose themselves to penalties.　

Accidental Americans considers that a Franco-American agreement from 2013 which allows for FATCA's application in France, "violates EU laws on data protection" by authorising "the transmission and storage of huge amounts of personal data in the United States," it said in a statement. As a result, the advocacy group says French nationals with dual American citizenship face de facto discrimination, even though "most of these people have no links with the United States."　

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

 

 

for a FREE Tax HELP Contact Us at:

www.TaxAid.com or www.OVDPLaw.com 

or Toll Free at 888-8TaxAid (888) 882-9243