Thursday, March 26, 2009

Amnesty to Those Who Evaded Tax Through Offshore Accounts

The TaxProf Blog has announced the IRS policy for reducing penalties for those who have evaded taxes on offshore accounts. See TaxProg Blog for more.

Addendum 3/27/09 9:50 am: Jack Townsend has posted the key points of the initiative on his Federal Tax Crimes Blog here.

AT&T Attorneys Offer Advice to Small Business Clinic Clients

Larry Jones is Director of the Tax Clinic and Small Business Clinic at the SMU Dedman School of Law. Today the Dallas Morning News has featured the Small Business Clinic. See the Article. For clients who cannot afford attorneys in tax and small business matters, these clinics at the Law School may be able to help. The number to arrange an appointment is 214-768-2562 or go to the website.

IRS to Announce Today Inducements on Offshore Accounts

The Wall Street Journal announces that the IRS will announce today the inducements for taxpayers with offshore accounts to come clean and avoid some of the draconian downside of past sins with respect to foreign accounts. Jack Townsend will be following this in more detail on his federal tax crimes blog, so we point our readers there.

Ask IRS For A Closing Letter

Clients will often ask for something in writing from the IRS that their collection case has been closed. The IRS has now issued a procedure for taxpayers to receive letters when their collection case is closed. This letter will be helpful and reassuring to the taxpayer when the IRS has classified a case as currently non collectible. See the IRS Memorandum with more detail.

Wednesday, March 25, 2009

It's Not Over Until the First Circuit Sings

The Tax Prof Blog reports that the First Circuit has granted rehearing in the infamous Textron Case denying the Government's attempt to summons tax accrual workpapers -- the tax mother lode for the IRS. The Tax Prof Blog report may be reviewed here (along with links to the opinion and some commentary on the opinion). Prediction: The Government will get the workpapers. Perhaps we'll write more on this later; perhaps not.

Tuesday, March 24, 2009

Questions on Preparing Partnership Tax Returns

Patti Logan, EA, in Colorado and our good friend has advised that the IRS recently added a page (See Link) providing answers to frequently asked partnership return questions to its website. The page provides nearly two dozen detailed questions and may be of assistance to accountants who file partnership tax returns.

Controls Over IRS Employee Telephone Calling Cards

TIGTA has issued a report on its review of whether the IRS has established effective controls to identify and address instances of waste, fraud, and abuse relating to the use of employee telephone calling cards. See the Report. Tghe report states: "Overall, the IRS lacks effective controls over telephone calling cards issued to employees. Specifically, telephone calling card charges are not routinely reviewed for waste, fraud, and abuse, and a comprehensive inventory of telephone calling cards is not completed annually".

It is interesting to note that the IRS is being stricter in taxpayer's keeping records, but not in their own house. Even the courts are enforcing the requirement of substantation. See: Freddy W. Fuentes v. Commissioner; T.C. Summ. Op. 2009-39; No. 16020-07S.

Less Inserts in Some IRS Mailings

The IRS has announced that nearly a dozen inserts that go into a notice informing businesses that they owe additional tax will no longer be included. This change affects the CP 161 notice, which is mailed to business taxpayers who underpay their taxes. See News Release IR-2009-24.

Hopefully, the IRS will expand this to copies of notices received by those of us who represent clients before the IRS. I often wonder why representatives need all of the inserts that are included in our copy of notices. Also, why does the IRS send two copies of the same letter?