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All of which may not be good for tax advisors.

Now according to Bloomberg BNA, IRS employees could be in for a rocky ride if President-elect Donald Trump and Congress move forward with sweeping pledges to rein in federal employee benefits and cripple unions.

Trump has vowed to place a hiring freeze on federal jobs and shrink the workforce, as one of his first efforts once in office, and ease firing restrictions. Other ideas Republican lawmakers have floated could also come to fruition now that no veto threat looms, such as ending automatic pay raises and changing benefits plans.

Those moves would be jarring for employees across federal agencies, but would particularly sting at the Internal Revenue Service, an agency that has lost millions of dollars through budget cuts and thousands of employees through attrition and retirement.

 

In a Rev Proc 2016-56,2016-51 IRB, the IRS has updated two lists of countries with which the U.S. has in effect an agreement that requires payors to report certain deposit interest paid to nonresident alien individuals who are residents of the other country under Reg. § 1.6049-8(a) and Reg. § 1.6049-4(b)(5).
 
One list is of countries with which the U.S. has in effect an income tax or other treaty or a bilateral agreement and the other is of countries with which IRS has determined that an automatic exchange of information is appropriate. 

The following are the countries with which the United States has in effect an income tax or other convention or bilateral agreement relating to the exchange of tax information within the meaning of section 6103(k)(4) pursuant to which the United States agrees to provide, as well as receive, information and under which the competent authority is the Secretary of the Treasury or his delegate:

1. Antigua & Barbuda
2. Aruba
3. Australia
4. Austria
5. Azerbaijan
6. Bangladesh
7. Barbados
8. Belgium
9. Bermuda
10. Brazil
11. British Virgin Islands
12. Bulgaria
13. Canada
14. Cayman Islands
15. China
16. Colombia
17. Costa Rica
18. Croatia
19. Curacao
20. Cyprus
21. Czech Republic
22. Denmark
23. Dominica
24. Dominican Republic
25. Egypt
26. Estonia
27. Finland
28. France
29. Germany
30. Gibraltar
31. Greece
32. Grenada
33. Guernsey
34. Guyana
35. Honduras
36. Hong Kong
37. Hungary
38. Iceland
39. India
40. Indonesia
41. Ireland
42. Isle of Man
43. Israel
44. Jamaica
45. Jersey
46. Korea, Republic of
47. Latvia
48. Liechtenstein
49. Lithuania
50. Luxembourg
51. Malta
52. Mauritius
53. Mexico
54. Netherlands
55. New Zealand
56. Norway
57. Poland
58. Saint Lucia 
59. Slovak Republic
60. Slovenia
61. South Africa
62. Spain
63. Sweden
64. United Kingdom

 

Pocedurally Taxing  recently posted regarding Dave Breen's, the acting Director of Villanova’s Low Income Taxpayer Clinic, view regarding the case of Greenfield v US; a recent IRS setback in a summons enforcement case out of the Second Circuit.

Dave's take on this recent case is that taxpayers and some practitioners may believe that the era of IRS investigating offshore tax evasion has run its course.  He thinks this case does just the opposite.

The Court’s decision demonstrates that much of IRS’s data on offshore tax evasion is dated, possibly even too old to be of any value, but he also suspect that IRS has come to the same conclusion. 

Rather than moving on to other areas of non-compliance though, he suspects that the IRS at this moment is developing more tools to secure the next wave of current information on offshore tax evasion.  This does not bode well for taxpayers who so far have avoided IRS’s inquiry into their offshore holdings. To Read More...