Category Archives: criminal tax law

According to DoJ, The U.S. District Court for the Northern District of Texas entered permanent injunctions on November 1, 2024 against Charles Dombek and The Optimal Financial Group LLC barring them from promoting any tax plan that involves creating or using sham management companies, deducting personal non-deductible expenses as business expenses or assisting in the creation of “captive” insurance companies. 

The injunctions also prohibit Dombek from preparing any federal tax returns for anyone other than himself and Optimal from preparing certain federal tax returns reflecting such tax plans. Dombek and Optimal consented to entry of the injunctions.

According to the government’s complaint, Dombek is a licensed CPA and served as Optimal’s manager and president. Allegedly, Dombek and Optimal promoted a tax scheme throughout the United States to illegally reduce customers’ income tax liabilities by using sham management companies to improperly shift income to be taxed at lower tax rates, improperly defer taxable income or claim personal expenses as bogus business deductions. 

As alleged by the government, Dombek promoted himself as the “premier dental CPA” in America. The complaint further alleges that in promoting the schemes, Dombek and Optimal made false statements about the tax benefits of the scheme that they knew or had reason to know were false, then prepared and signed tax returns for their customers reflecting the sham transactions, expenses and deductions. The government contended that the total harm to the treasury from the scheme could have been $10 million or more.

Each year the IRS highlights some of the tax scams that put taxpayers at risk of losing money, personal information, data and more. In the IRS’s most recent list it specifically warned taxpayers “to beware of promoters peddling bogus tax schemes aimed at reducing taxes or avoiding them altogether.”

Working with the IRS, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters over the past decade. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

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

Read more at: Tax Times blog

Those who thought their cryptocurrency transactions would remain anonymous or a secret from the Internal Revenue Service should think again according to Law360.

Nearly 50 years ago, the U.S. Supreme Court held that information customers voluntarily provide to banks is not subject to Fourth Amendment privacy protections, and therefore can be disclosed to law enforcement. In September of 2024 him, in James Harper v. Daniel Werfel, the U.S. Court of Appeals for the First Circuit expanded this principle to cryptocurrency exchanges.

This ruling, as well as those of various district courts, confirms the ability of the IRS to identify taxpayers engaged in financial transactions involving cryptocurrency exchanges. Much as for taxpayers decades ago who believed their use of Swiss bank accounts would allow them to conceal their income, this ruling is another wake-up call for any who may still have similar thoughts about using digital asset currency exchanges.

The issuance of John Doe summonses remains one of the strongest tools in the IRS' enforcement arsenal. These summonses allow the IRS to obtain information on large numbers of taxpayers in one fell swoop. 

The First Circuit's decision in Harper upheld the IRS' right to issue John Doe summonses to cryptocurrency exchanges, finding that cryptocurrency users do not have a Fourth Amendment reasonable expectation of privacy in their records held by exchanges.

While the use of John Doe summonses isn't new, this is the first time a court of appeals has expressly approved their use. For years, federal prosecutors have been champing at the bit by ramping up investigations of and enforcement against taxpayers who use digital assets to evade tax liabilities.

Harper should serve as a signal to taxpayers and cryptocurrency exchanges alike that the IRS-CI will not be letting up anytime soon.

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

Read more at: Tax Times blog

On October 7, 2024 the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced that certain victims of Hurricane Milton, Hurricane Helene, Hurricane Debby, Hurricane Beryl, and Hurricane Francine will receive an additional six months to submit beneficial ownership information reports, including updates and corrections to prior reports. 

FinCEN has issued five Notices extending the filing deadlines to for reporting companies that 1) have an original reporting deadline beginning one day before the date the specified disaster began and ending 90 days after that date, and 2) are located in an area that is designated both by the Federal Emergency Management Agency as qualifying for individual or public assistance and by the Internal Revenue Service as eligible for tax filing relief. 

Please refer to the applicable Notice for specific information.

• Notice regarding Hurricane Milton: https://www.fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Milton-508FINAL.pdf 
• Notice regarding Hurricane Helene: https://www.fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Helene-508FINAL.pdf
• Notice regarding Hurricane Debby: https://www.fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Debby-508FINAL.pdf
• Notice regarding Hurricane Beryl: https://www.fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Beryl-508FINAL.pdf
• Notice regarding Hurricane Francine: https://www.fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Francine-508FINAL.pdf

FinCEN is providing this relief to reporting companies that meet two requirements.  

First, the deadline for the reporting company to file an initial or updated BOI report must fall on or between October 4, 2024, and January 2, 2025.  I

Second, the reporting company must have its principal place of business in an area designated both by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance, and by the Internal Revenue Service (IRS) as eligible for tax filing relief as a result of Various Hurricanes.  

If, after the date of this announcement, the IRS designates other areas affected by this natural disaster as eligible for tax filing relief, the reporting companies with their principal place of business in those areas will also receive the same BOI reporting relief from FinCEN automatically, i.e., reporting companies with an initial or updated BOI report due on or between October 4, 2024, and January 2, 2025, with a principal places of business located in these other areas, will also have an additional six months from their original deadline to submit BOI reports.   

For example, the initial BOI report of a reporting company created or registered before January 1, 2024, normally would be due by January 1, 2025.  If such a company has its principal place of business in an area designated both by FEMA as qualifying for individual or public assistance and by the IRS as eligible for tax filing relief as a result of a Hurricane, the company’s initial BOI report is now instead due by July 1, 2025.  

Similarly, the initial BOI report of a reporting company created or registered on July 25, 2024, normally would be due by October 23, 2024.  If such a company has its principal place of business in an area designated both by FEMA as qualifying for individual or public assistance and by the IRS as eligible for tax filing relief as a result of a Hurricane, the company’s initial BOI report is now instead due by April 23, 2025. 

In addition, FinCEN will work with any reporting company whose principal place of business is outside the disaster areas but that must consult records located in the affected areas to meet the deadline.  

Reporting companies with a principal place of business outside the affected areas and that are seeking assistance in meeting their filing obligations should contact FinCEN at  www.fincen.gov/boi.

Need Help Filing Your BOI Report?

     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)

 

Read more at: Tax Times blog

The Internal Revenue Service said in its notice that the number of people who expatriated from the U.S. increased nearly 24% during the third quarter of 2024 compared with the previous quarter. 

The Number Of People Losing Or Renouncing Their U.S. Citizenship Increased to 2,123 For the 3rd Qtr of 2024.

A 25% Increase From The 2nd Quarter of 2024.

Included on the list are those who lost U.S. citizenship under Internal Revenue Code Section 877(a) and Section 877A, according to the notice, as well as long-term residents who are treated as losing citizenship under Section 877(e)(2).

According to CNBC the top reason why Americans abroad want to dump their U.S. citizenship include:

• Nearly 1 in 4 American expatriates say they are “seriously considering” or “planning” to ditch their U.S. citizenship, a survey from Greenback Expat Tax Services finds.  
• About 9 million U.S. citizens are living abroad, the U.S. Department of State estimates.
• More than 4 in 10 who would renounce citizenship say it’s due to the burden of filing U.S. taxes, the Greenback poll shows.

Should I Stay or Should I Go?

Need Advise on Expatriation?

 

Contact the Tax Lawyers at 

Marini & Associates, P.A.   

for a FREE Tax Consultation contact us at:

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

Read more at: Tax Times blog