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To combat late information return filings, the IRS has systemically assessed penalties for certain late-filed international information returns, including IRS Forms 3520, 3520-A, 5471, and 5472. Under these systemic assessment [...]

The employee retention credit (ERC) has been a thorn in the IRS' side for some time. Enacted during the COVID-19 pandemic, Congress originally designed the ERC as a means to [...]

Since the inception of the U.S. tax system, some taxpayers have willfully failed to comply with the tax laws. Because failures due to willful conduct may result in criminal prosecution, [...]

U.S. persons who make outbound investments in foreign corporations often have thorny federal reporting obligations. In addition to the commonly filed IRS Form 5471, Information Return of U.S. Persons With [...]

In recent years, the government has continued to ramp up its investigatory efforts concerning trust arrangements that it deems abusive for tax purposes. These investigations have included so-called 'section 643(b) [...]

For FBAR penalty purposes, there is a critical distinction between willful and non-willful conduct. If a U.S. person willfully fails to file a correct and timely FBAR, the IRS may [...]

Under a split-dollar life insurance arrangement, a third party pays the insurance premiums on an insured person but maintains a right to reimbursement of some or all of the premiums. [...]

Disagreements happen. In the corporate context, one or more shareholders may share a different vision for the company than the other shareholders. Or, there may be acrimony amongst the shareholders [...]

The IRS continues to aggressively enforce certain foreign information return obligations. In many cases, these enforcement efforts are automatic--that is, the agency simply imposes the applicable penalty after receipt of [...]

Title 31 of the U.S. Code allows the IRS to impose civil penalties for a U.S. person's failure to file a timely and proper FBAR by the statutory deadline. However, [...]

In a recent news release, the IRS announced that it intends to deny 'tens of thousands' of ERC refund claims while processing others 'at a dramatically slower pace than . [...]

In recent years, the IRS has devoted more resources to employment tax matters. In addition to standard non-reporting and non-payment disputes, which will always be a high priority to the [...]

There are many different tax elections available to taxpayers under federal tax law. And, often, these elections are advantageous. For example, taxpayers can make a qualified electing fund (QEF) election [...]

In recent years, the government has made concerted efforts to win willful FBAR penalty cases through summary judgment motions. This is not surprising. Thus far, it has convinced courts that [...]

Corrected, July 19, 2024: This article has been updated to fix a typo in the third paragraph and clarify a reference in the parenthetical to the 2024 filing date. In [...]

Corrected, July 18, 2024: This article has been updated to fix a typo in the fifth paragraph and clarify a reference to a tax preparer missing a deadline. Generally, U.S. [...]

As the world grows smaller, U.S. citizens and residents continue to find themselves entangled in complex U.S. foreign reporting. This is particularly so when it comes to foreign retirement plans. [...]

U.S. citizens and residents with financial interests in foreign accounts that exceed $10,000 at any time in a year must file an FBAR. The failure to file an FBAR can [...]

Occasionally, the IRS goofs and issues a refund check in error to a taxpayer. If the IRS discovers the error, it will usually attempt informally to recover the funds. When [...]

U.S. persons with interests in foreign trusts often have complicated international reporting obligations. Aside from an IRS Form 3520, these persons may have separate requirements to file IRS Form 3520-A. [...]

Introduction Cayman Islands exempted companies are commonly used by venture capital and private equity investors for pre-IPO preference share financings. The Cayman Islands' well-established legal system based on English common [...]

Almost from its inception, the IRS and employers have experienced headaches from the employee retention credit (ERC). Much of the frustration now stems from the agency's long processing times. According [...]

The Bank Secrecy Act requires U.S. taxpayers to file annual reports with the government if their foreign accounts exceed $10,000 at any time in a calendar year. If a taxpayer [...]

Taxpayers with foreign assets often have international information return filing requirements. And the failure to timely file these returns can be costly. In addition to significant civil penalties for late [...]

Married taxpayers can file their taxes together or separately. Because it is often more tax-advantageous and convenient to file together, most married individuals elect to file as married filing jointly. [...]

In tax cases, sometimes procedure alone wins the day. In SN Worthington Holdings LLC v. Comm'r, 162 T.C. No. 10 (May 22, 2024), a partnership made an election to have [...]

In recent years, the IRS has focused its attention and resources on large partnerships. In 2021, the agency launched an initial phase of its Large Partnership Compliance (LPC) program. Under [...]

On March 25, 2024, the IRS issued proposed regulations (REG-108761-22) which, if finalized, would identify certain CRATs as listed transactions. For those unaware of the listed transaction rules, such a [...]

The last few years have seen the proliferation of so-called section 643(b) trusts. Although there are various iterations of these trust arrangements, a common purpose seems to permeate each of [...]

The statute of limitations is an important concept in law. Generally, it requires a litigant to file a claim within a specified period of time or forever lose that claim. [...]

The employee retention credit (ERC) has been a hot topic lately in the tax world. On September 14, 2023, the IRS imposed an administrative moratorium on processing ERC claims, citing [...]

We have previously spoken about monetized installment sales ('MISTs') on Dollars & Sense. According to the IRS, these structures typically seek to defer gains associated with the sale of an [...]

For some time, the IRS has targeted fraudulent employee retention credit ('ERC') claims. More recently, on December 21, 2023, the IRS issued guidance on a new voluntary disclosure program (the [...]

The recent Tax Court decision in Farhy demonstrates that clever and novel arguments can carry the day in complex tax litigation matters. In that case, the taxpayer stipulated that he: [...]

Introduction In the federal income tax world, there are effectively two functions within the Internal Revenue Service ('IRS'). First, the IRS examines tax years and tax returns to determine whether [...]

If you have unreported foreign accounts, you are not alone. Every year, I speak with hundreds of clients with tax non-reporting issues (e.g., FBARs, Form 8938, Form 3520, Form 3520-A, [...]

Introduction Much of the current litigation between taxpayers and the United States has centered on the definition of willfulness or whether the non-willful FBAR penalty should apply on a per [...]

Under federal tax law, there are significant differences between grantor and non-grantor trusts. Grantor trusts are treated as disregarded entities. In layman's terms, this means that the grantor (i.e., the [...]

Co-authored by: Garrett Reinhart, Law Clerk As 2023 begins, we are tracking several key legal and regulatory issues that are sure to impact the health care industry in North and [...]

Recently, there seems to be some confusion regarding section 643(b) of the Internal Revenue Code of 1986, as amended (the 'Code'), and its application to trusts. Indeed, that provision--particularly to [...]

Trusts come in many variations, rendering them often difficult for non-attorneys to follow and comprehend. Indeed, this variation can often be seen in the nomenclature used for trust arrangements, which [...]

The Bank Secrecy Act ('BSA') requires United States persons ('USPs') to file FinCEN Forms 114, Report of Foreign Bank and Financial Accounts ('FBARs'), for each calendar year in which the [...]

FBAR penalty procedures under Title 31 are similar to federal tax penalty procedures under Title 26. Under both Title 31 and Title 26, the IRS must make a timely assessment [...]

Enacted as part of the CARES Act in 2020, the Employee Retention Credit (ERC) provided much-needed relief to employers during the COVID-19 pandemic, particularly those who were on the fence [...]

Taxpayers routinely resolve their tax controversy matters without resort to litigation. Indeed, good tax professionals will often seek to avoid costly and time-consuming litigation, if possible, by utilizing various administrative [...]

What 2022 Has Taught Us About FBAR Willfulness The Bank Secrecy Act requires certain taxpayers to submit timely FBARs to the United States reporting their interests in foreign accounts. If [...]

Can You Go to Jail for Not Paying Your IRS Taxes? Taxpayers routinely ask me if they can go to jail for not paying their federal income taxes. Admittedly, the [...]

Dern Reminds that Settlement Language is Important in Section 104(a)(2) Physical Injury Cases Taxpayers initiate lawsuits for a variety of reasons. For example, a taxpayer may bring a lawsuit against [...]

Missing any deadline is stressful. But missing a tax deadline is more so. Per the Bank Secrecy Act (Title 31 of the U.S. Code), certain taxpayers must file so-called FBARs [...]

Federal case and after federal case continues to come out providing real-life examples of the pitfalls of filing a Streamlined Filing Compliance Procedure ('SFCP') with the IRS when the facts [...]