The Treasury Inspector General for Tax Administration (TIGTA) recently released its final report on Internal Revenue Service (IRS) compliance trends through FY 2018, during which time period U.S. taxpayers filed over 152 million individual and 11.4 million business income tax returns and forms. The IRS collected over $3.4 trillion in revenue, with an all-time high of $59.4 billion in enforcement revenue.
The Internal Revenue Service (IRS) recently announced the "Relief Procedures for Certain Former Citizens," which will allow certain individuals to come into compliance with their U.S. tax and filing obligations. The procedures apply to individuals who are former U.S. citizens or who intend to relinquish citizenship, have not filed U.S. tax returns as citizens or residents, owe a limited amount of back taxes, and have net assets under $2 million. There is also a willfulness component to consider.
The Treasury Inspector General for Tax Administration (TIGTA) recently released a report finding that the Internal Revenue Service's (IRS') Criminal Investigation team (CI) should increase its involvement in the enforcement against identity theft issues. From FY 2013 to FYY 2017, there was a 75-percent decrease in the number of CI-initiated identity theft investigations; overall, there was a 43-percent decline in these types of investigations over the same period. In addition, many taxpayer requests for identity theft investigations were not entered into the CI referral system process.
The Internal Revenue Service (IRS) recently announced that it will automatically waive the estimated tax penalty for over 400,000 eligible taxpayers whose withholding and estimated tax payments fell short of their 2018 tax liability, and it removed the requirement that estimated payments be made in four equal installments (if paid by January 15, 2019).
The Internal Revenue Service (IRS) and Security Summit partners recently issued a reminder to tax professionals to watch for signs of data theft that could lead to the filing of fraudulent tax returns. Warning signs include receiving unexpected copies of tax transcripts or IRS notices and experiencing network slow-downs or lock-outs.
The IRS recently announced a letter campaign, issuing one of three letters to taxpayers regarding virtual currency. Two of the letters are informational, sent to taxpayers who may have had a requirement to report virtual currency transactions but did not do so (Letter 6174), or taxpayers who reported transactions with virtual currency but may have made a mistake (Letter 6174-A). Neither of these letters require a response to the IRS. It is the third letter that gives tax professionals pause for concern.
If you dealt in virtual currency in recent years, you may soon receive a letter from the IRS regarding a potential failure to report income and pay related taxes, according to a recent IRS announcement. The federal tax agency is beginning to reach out to taxpayers as part of the virtual currency compliance campaign it announced last year.
The Taxpayer First Act signed into law by President Trump requires the IRS to make important changes that will benefit taxpayers and improve tax administration.
In a recent tax controversy forum hosted by New York University, the Principal Deputy Assistant Attorney General to the Department of Justice Tax Division (DOJ-Tax), Richard Zuckerman, said that his team is increasing its focus on individuals attempting to use bitcoin and other digital assets to evade taxes. DOJ-Tax is currently prosecuting several criminal cryptocurrency cases, and Zuckerman noted that others are already in process.