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The IRS is keeping the pressure on high-income earners who fail to file tax returns, and others who may hide their earnings to avoid paying taxes. Darren Guillot, Commissioner of the IRS Small Business/Self-Employed Collection Division said the goal is to avoid (as much as possible) escalating a case to enforcement proceedings.  His message on…

Internal Revenue Service Commissioner Charles Rettig praised the work of agency employees throughout the COVID-19 pandemic but stated that there simply are not enough of them as the agency is slowly working through the backlog the pandemic caused.  “I appreciate your patience and understanding and working with us,” he said November 16 at the AICPA…

On April 28, 2021, the U.S. Department of the Treasury issued a press release titled, “Investing in the IRS and Improving Tax Compliance.”  In it, the Department identified five items of reform to be implemented in the near future: 1. Provide the IRS the resources it needs to stop sophisticated tax evasion. 2. Provide the…

The U.S. Tax Court recently decided that a 75% civil fraud penalty had not been properly asserted against married taxpayers because the revenue agent did not obtain prior written approval to propose the penalty from her supervisor, as required by IRC Section 6751(b)(1).  That section prohibits assessment of a penalty unless the “initial determination” of…

Interesting debate over Internal Revenue Code §265(a).  The IRS and Treasury Secretary Steven Mnuchin say: “The money coming in the PPP is not taxable. So if the money that is coming is not taxable, you cannot double dip,” Mnuchin said in a televised interview this week. “You cannot say that you are going to get…

IRS Announces Relief for Taxpayers The Internal Revenue Service today, March 25, 2020, announced important steps it will take to provide relief to taxpayers on a wide variety of issues ranging from tax collections to delaying compliance actions. The IRS will continue to protect all statutes of limitations, but it will also implement the follow…

One of the goals of the IRS, it announced, is to bring delinquent taxpayers into compliance with their return-filing and tax-paying obligations.  The IRS will also use data analytics, research, and new compliance strategies—including personal visits—to reach taxpayers and return preparers who have not filed tax returns.  Strategies include holding income tax refunds when a…

IRS individual income tax audits continue to decrease, according to the IRS fiscal year 2019 Progress Update Report released this week.  Taxpayers are now half as likely to be audited by the IRS for their individual income tax returns as they were a decade ago, with the decline in the IRS workforce largely to blame. …

Tax issues for solo practitioners and small law firms are pretty much the same as those for other businesses. In order to reduce your chances for an audit, report all income, and don’t over-deduct your expenses. The IRS pays close attention to Form 1099 reporters, so make sure all of that income gets reported on…

Principal attorneys and directors of law firms should be aware that the United States Tax Court reclassified contract attorneys of a personal-injury law firm as employees of the firm, and therefore subject to the employment tax provisions of the Internal Revenue Code. The ruling against the professional corporation law firm was for more than $150,000.00…