The IRS Audit Blog

Archive for October, 2006

Making ‘Me Inc.’ work for you

Do you dream of just chucking the corporate rat race and becoming your own boss?

IRS announced tax rebate calendar

The IRS moves onto using civil Information Document Requests for the FBAR (Foreign Bank Account Reporting) to seek out Undisclosed Offshore Accounts after the fallout from UBS AG and the IRS Offshore Settlement Initiative.

What can U.S. taxpayers expect next?

In 2009, the IRS and U.S. Department of Justice launched a highly publicized investigation into Swiss bank UBS AG and U.S. account holders who failed to disclose their assets to the U.S. Government. However, the investigation did not end with UBS. To encourage taxpayers to come forward and disclose their foreign assets in exchange for reduced penalties, the IRS instituted the Offshore Settlement Initiative Voluntary Disclosure Program (the Initiative).Although the deadline to participate in the Offshore Settlement Initiative came and went, it is clear that offshore tax evasion remains a top IRS enforcement priority. What can U.S. taxpayers with undisclosed offshore accounts who failed to meet the October 15, 2009 Offshore Settlement Initiative deadline expect next?

The IRS will be increasing their Information Document Requests or IDRs focusing on offshore bank accounts. Taxpayers may receive a Form 6564, Information Document Request, to secure necessary books, papers, and other data relevant to the IRS examiner inquiry into the validity of a tax return. The Information Document Request is a formal and structured process for the IRS to request and secure information from taxpayers, including information regarding offshore bank accounts. Although less formal than a subpoena, an IDR carries with it consequences for failure to cooperate and can lead to further inquiry and potential sanction. A delay in providing the requested documentation will only make matters worse.

The IRS will focus on distributing Information Document Requests to U.S. taxpayers with offshore assets and accounts that failed to disclose these interests to the U.S. government on their Form 1040, U.S. Individual Tax Returns, and file a corresponding Form TD F 90-22.1, Foreign Bank Account Reporting (FBAR). If IRS agents discover that a taxpayer has not reported an interest in an offshore account or income accruing on such accounts during the course of an audit, the IRS may impose steep penalties including the greater of $100,000 or 50% of the offshore account balance for willful failure to file an FBAR for each account. These penalties, compounded with interest and fraud penalties, can essentially wipe out the taxpayers foreign assets. Additionally, taxpayers could be subject to criminal prosecution and jail time for tax evasion.

The issues surrounding these IDRs are extremely sensitive and should be treated with considerable caution. Taxpayers who have been issued an Information Document Request by the IRS are best served by contacting a tax attorney who is skilled at resolving disputes with the IRS as soon as possible. An attorney can direct the taxpayer how best to respond to an Information Document Request and will be able to discuss with his attorney the best course of action. Otherwise the Internal Revenue Service can seek formidable fines and possible criminal prosecution against those U.S. Taxpayers believed to be hiding assets in undisclosed offshore accounts.

Dallas IRS Worker Admits To Accepting Bribe

An IRS worker in Dallas who accepted a bribe in exchange for a promise of no audit faces a maximum 15 years in prison. Sentencing is March 29 for 33-year-old Fernando Hernandez of Dallas. Prosecutors say Hernandez on Tuesday pleaded guilty to receiving a bribe by a public official. He also could be fined up to $250,000.

Need IRS Audit Help

APPOINTMENTS

Global Defense Technology & Systems of McLean named Joseph M. Cormier , former corporate officer with ManTech International, senior vice president of Finance.

IRS Misconducts

Question: Can I be arrested for unpaid IRS tax bills?

I left the USA without filing tax returns for several years. Tax bills were sent to me by California & IRS at my last known address based on their assessed monies owing, not necessarily the real facts if I had filed.
If I re-enter the USA can I be arrested?

Answer: It’s usually a civil thing, not very often criminal. But they will catch up to you and collect the money. The IRS usually gets their money and if you try to avoid them, it’s called tax evasion!

Life and Taxes: Top returns preparer traces his tale across disciplines, decades

McALLEN — Dale Haworth was bemused as he read the ad in the Kansas City paper. Why would anyone pay someone else to complete their tax return? The 19-year-old needed a job, so he followed the listed address to a downtown office. It was 1961 and…

Strike Commander – Part 57 – San Francisco

Question: I am trying to find a place of employment on my ex husband, we owe the IRS and he is not filing his taxes.?

I have his ss#, birthdate, and current address

Answer: You can contact the IRS at 1-800-829-1040 and let them know the situation. If you are not due to owe these taxes and he is, you will have to fill out an injured spouse form so you will not be liable to pay any of these taxes.

Tax season starts with fake e-mails

The start of tax season is a week away, so that means it’s time for the tax scams to begin. Popping up in South Florida inboxes is an e-mail message asking the respondent to fill out an “updated version” of the W-2 form, the form most employees receive regarding their wages and taxes withheld.

Ron Paul’s Weekly Address (6/22/09)