The IRS and FBARs - On March 30, 2022, the IRS issued Publication 5569, Report of Foreign Bank & Financial Accounts (FBAR) Reference Guide. The 12-page publication provides helpful information to both taxpayers and tax...more
Introduction. On May 17, 2021, the United States Supreme Court handed the IRS a significant loss when it concluded that CIC Services, LLC (“CIC”) could continue its lawsuit against the IRS for violations of the...more
Taxpayers who employ workers have obligations under federal law to withhold and remit federal employment taxes to the IRS. In addition to this withholding and payment requirement, federal law also imposes certain reporting...more
FBAR Penalties - On March 8, 2022, the Southern District of New York issued its Opinion in the case of United States v. Schik, No. 20-cv-0221 (MKV), 2022 U.S. Dist. Lexis 41148 (S.D.N.Y. Mar. 8, 2022). In that case, the...more
The Administrative Procedure Act.
The Internal Revenue Code (the “Code”) contains over one hundred different civil penalties for various acts or failures to act. For example, Section 6707A requires taxpayers, in certain...more
Taxpayers are always interested in whether certain expenditures qualify as tax deductions. But many taxpayers often forget that expenditures may alternatively qualify for various tax credits. And all things being equal,...more
On February 15, 2022, the IRS announced that IRS Form 14457, Voluntary Disclosure Practice Preclearance Request and Application, and the accompanying instructions to the form had been revised. Because the revisions provide...more
Generally, when a taxpayer makes an overpayment of tax, the IRS refunds the overpayment to the taxpayer. But this is not always the case. For example, the IRS has the statutory authority to credit (or offset) an overpayment...more
The concept of “willfulness” is an important one in the FBAR civil penalty context. Indeed, a taxpayer’s willful failure to file a timely and accurate FBAR may result in significant penalties: the higher of 50-percent of...more
For one reason or another, I had several calls last year with attorneys and others regarding IRS Streamlined Filing Compliance Procedure submissions gone wrong. In most cases, it was evident that the tax professional had...more
In civil and in criminal cases, the Government must generally act within a certain prescribed time to take action against taxpayers. In legal parlance, this period of time is known as the “statute of limitations.” The...more
2/8/2022
/ Criminal Liability ,
Foreign Bank Accounts ,
Government Investigations ,
Income Taxes ,
Indictments ,
IRS ,
Jury Instructions ,
OVDP ,
Statute of Limitations ,
Tax Evasion ,
Tax Liability ,
Tax Planning
Willful FBAR Penalties - The Schwarzbaum case has received a lot of attention in the last few years from tax professionals. For example, in 2020, the district court concluded—contrary to some other federal court...more
Good tax attorneys will do whatever it ethically takes to win on behalf of their clients. Often, this means the attorney must not only have a good understanding of the substantive provisions at play, but also relevant...more
Also Referred to as Internal Revenue Code Section 6672; I.R.C. § 6672; Section 6672; Trust Fund Recovery Penalty -
Background. In certain instances, the Internal Revenue Code (the “Code”) requires persons to withhold...more
Taxpayers have long utilized trust arrangements for the transfer of wealth to beneficiaries or for the protection of assets from creditors. Generally, there is nothing nefarious about these types of arrangements. Rather,...more
1/14/2022
/ Estate Planning ,
Foreign Trusts ,
Grantor Trusts ,
Income Taxes ,
Internal Revenue Code (IRC) ,
International Tax Issues ,
IRS ,
Tax Amnesty ,
Tax Evasion ,
Tax Planning ,
Tax Returns ,
Voluntary Disclosure
This morning, I woke up to news in the Wall Street Journal that indicated that the United States and the Republic of Malta had entered into a Competent Authority Agreement (“CAA”). Generally, this news would not have caught...more
In most cases, IRS exam initiates FBAR assessments. And, after an IRS examiner determines that an FBAR penalty is appropriate, taxpayers are generally afforded pre- or post-assessment appeals rights with the IRS Independent...more
United States citizens and residents[i] are subject to federal income tax on their worldwide income. For example, even if a United States citizen permanently relocates to a foreign country, he or she will generally continue...more
1/6/2022
/ FBAR ,
FOIA ,
GAO ,
Income Taxes ,
International Tax Issues ,
IRS ,
Offshore Funds ,
OVDP ,
Retirement Plan ,
Revenue Procedures ,
Tax Evasion ,
Tax Planning ,
Voluntary Disclosure
On November 30, 2021, the United States Court of Appeals for the Fifth Circuit issued its opinion in U.S. v. Bittner. Contrary to decisions of other federal courts, the Fifth Circuit concluded that it was proper for the IRS...more
Ordinarily, taxpayers file their income tax returns each year with the IRS and hear nothing more. Rather, the Internal Revenue Service (“IRS”) simply processes the tax return, assesses the reported amount of tax due, and...more
The House Committee of Ways and Means (the “House”) has been busy the last few days. Indeed, the House continues to mark up and work through potential revenue raisers (i.e., tax increases) to help pay for recent legislative...more
10/12/2021
/ Capital Gains Tax ,
Corporate Taxes ,
Foreign Derived Intangible Income (FDII) ,
GILTI tax ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Tax Cuts and Jobs Act ,
Tax Increases ,
Tax Planning ,
Tax Rates
Our firm has written extensively on the topic of cryptocurrency. Indeed, we have even designated an entire resource page on our website to this always interesting and constantly evolving topic...more
Taxpayers who file false tax returns with the IRS can find themselves in hot water. Indeed, section 7206(1) of the Internal Revenue Code (“Title 26”) makes it a felony to file a false return when the taxpayer knows that the...more
The Internal Revenue Code (the “Code”) contains over 150 civil tax penalties for various conduct and non-conduct. One common group of penalties, associated with the late filing of a tax return and the late payment of tax,...more
9/7/2021
/ Amended Complaints ,
Estate Tax ,
Federal Rule 12(b)(6) ,
Filing Deadlines ,
Gift Tax ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Late Payments ,
Motion to Dismiss ,
Reasonable Cause Defense ,
Tax Penalties ,
Tax Returns
To levy on Social Security benefits, the IRS generally issues Form 668-W to the Social Security Administration (“SSA”). After receipt of the Form 668-W, Notice of Levy on Wages, Salary, and Other Income, SSA will withhold...more