Resolving IRS disputes through audit reconsideration

- By : Parag Patel

…of “rework” of a previous audit where some issues remain unresolved. In a typical audit reconsideration situation, the taxpayer believes that the audit resulted in an inappropriate increase in tax…

New Jersey Department of Revenue publishes “Manual of Audit Procedures”

- By : Parag Patel

…demonstrated that all returns were filed correctly. This discontinued the audit before it even started. 8.11 Walk-Away Audit If, after the pre-audit interview with the taxpayer, the auditor determines that…

15 IRS Audit Tips

- By : Parag Patel

…reconstruct records. 11. Do not bring to an audit any documents that do not pertain to the year under audit or were not specifically requested by the audit notice. 12….

Audit Beware: IRS’ Global High Wealth Industry Group

- By : Parag Patel

…for an audit. Those that are targeted can expect a particularly rigorous audit. The new unit combines seasoned revenue agents (auditors) with offshore examiners and specialists capable of auditing every…

Post IRS Audit Strategic Options: The IRS’ 30 Day Letter

- By : Parag Patel

…types of tax controversy matters, including IRS appeals and audits. If you are facing an audit or determining whether to appeal an audit, please contact us for a free consultation….

U.S. Taxpayers at New Risk of Audit from OVDP Declines and Withdrawals Campaign

- By : Parag Patel

…taxpayer receives a soft letter, the IRS will list a number of options to resolve the taxpayer’s non-compliance, requiring a response from the taxpayer. Examination (audit) by the IRS for…

30-DAY LETTERS VS. 90-DAY LETTERS IN TAX AUDITS

- By : Parag Patel

In a tax audit situations, the IRS only has a 3 year statute of limitations to assess additional taxes. If the IRS takes too long to initiate an audit, or…

ABA COMMENTS ON THE 2014 OFFSHORE VOLUNTARY DISCLOSURE PROGRAM AND THE STREAMLINED PROGRAMS

- By : Parag Patel

…would be similarly situated in an audit or the SFOP, but the practical reality is that the cost and uncertainty involved in an audit far outweigh the already significant costs…

Employee or Contractor?: The IRS’s New Voluntary Classification Settlement Program (VCSP)

- By : Parag Patel

…three years; Not currently be under audit by the IRS; Not currently be under audit by the Department of Labor or a state government agency concerning worker classification; and If…

New Streamlined Domestic Offshore Procedures (SDOP) is a Game Changer

- By : Parag Patel

…analyzed. While taxpayers in the SDOP are not automatically audited, an SDOP filing is subject the possibility of normal audit selection. Under such audit, the taxpayer should be prepared to…

New IRS Disclosure Program Announced for Non-Resident Taxpayers: Streamlined Foreign Offshore Procedures

- By : Parag Patel

…analyzed. While taxpayers in the SFOP are not automatically audited, an SFOP filing is subject the possibility of normal audit selection. Under such audit, the taxpayer should be prepared to…

The “Quiet” or “Silent” Disclosure

- By : Parag Patel

…hopefully avoid further IRS scrutiny (i.e., an audit whereby the IRS decides whether to impose the statutory penalties). By making a “quiet” disclosure, a taxpayer runs the risk of being…

OVDP Ineligibility Possibility Increases

- By : Parag Patel

…taxpayer was contacted by the government (or otherwise investigated or under criminal/civil audit) they were no longer eligible for OVDP. For example, HSBC India, which provided numerous U.S. accountholders names,…

Full Analysis of Updated 2012 OVDP Program

- By : Parag Patel

…handled under the traditional IRS audit process. A taxpayer may choose to opt out when the result reached under the 2012 OVDP penalty framework (see next section) appears too severe…

New IRS IRM with Updated Streamlined Filing Compliance procedures

- By : Parag Patel

The Internal Revenue Manual (IRM) is essentially the IRS employee handbook on how to carry out all administrative and procedural matters, such as how to audit specific tax returns, collect…

New Court Case Limits the Reasonable cause exception to FBAR penalties

- By : Parag Patel

…In 2011, the IRS conducted an audit into the Jarnagins’ tax returns for 2008 and 2009. The audit revealed two wire transfers from the CIBC account. While the tax amounts…

IRS examines jewelry, precious stones and metals businesses for compliance

- By : Parag Patel

…Form 8300 compliance. This audit is very much like a tax audit; the IRS checks records to look for receipt of cash payments that required filing of the 8300 form….

IRS Revises Delinquent International Information Return Submission Procedure (DIIRSP)

- By : Parag Patel

…with amended returns will not be automatically subject to audit but may be selected for audit through the existing audit selection processes that are in place for any tax or…

IRS announces two new intriguing targeted enforcement campaigns

- By : Parag Patel

…campaigns, the failure to respond to such letters may result in audit or penalties and possible criminal prosecution. As a result, we expect increased IRS audit activity for clients with…

The IRS Large Business and International division (LB&I) has announced a new Post OVDP Compliance enforcement campaign

- By : Parag Patel

…offshore private banks. This campaign indicates the IRS’ renewed focus on OVDP and taxpayers’ foreign activities. The IRS will initially address tax noncompliance through audit examination and soft letter treatment…

NJ Division of Taxation Offers Offshore Voluntary Compliance Initiative

- By : Parag Patel

…Tax Audit Branch PO Box 288 Trenton, New Jersey 08695-0288 For questions concerning individuals and partnerships: please call the Individual Tax Audit Branch at 609-292-2163 and ask for Supervisor Dan…

2 recent IRS developments that will impact Indian Americans

- By : Parag Patel

…an option. “The filing of an amended income tax return has heighted audit risk (probably significantly greater than the original filed return). The filing of a delinquent FBAR also has…

Appeals of penalties imposed during the Offshore Voluntary Opt-Out

- By : Parag Patel

…there any appeal available to contest an OVDI opt-out penalty? Yes. Opt outs are essentially audits, and audit determinations can be appealed in the same manner as lesser court rulings,…

Opt Out of OVDI Program Penalties to Get a Lower Penalty

- By : Parag Patel

…opt out there is still hope because an appeal is available to contest an OVDI opt-out penalty. Opt outs are essentially audits, and audit determinations can be appealed in the…

IRS Announces Penalty Mitigation for Smaller US Taxpayers Living Abroad

- By : Parag Patel

…the past six years. Submissions from taxpayers that present higher compliance risk will be subject to a more thorough review and potentially subject to an audit, which could cover more…

IRS delinquent FBAR submission procedure

- By : Parag Patel

…FBARs will not be automatically subject to audit but may be selected for audit through the existing audit selection processes that are in place for any tax or information returns….

IRS Announces New Statistics Regarding Voluntary Disclosures

- By : Parag Patel

…subject to IRS audit automatically, the IRS points out that: “[t]hey may be selected for audit under existing audit selection processes applicable to any U.S. tax return and may also…

What Is The Difference Between the SDOP and the Current OVDP program?: Willfulness

- By : Parag Patel

…knowledge and violations. Although filing an SDOP does not automatically select the taxpayer for an IRS audit, the taxpayers is still subject to the possible normal audit selection. The taxpayer…

The IRS Large Business and International division (LB&I) has announced a new Offshore Private Banking enforcement campaign

- By : Parag Patel

…accounts at offshore private banks. This campaign addresses tax noncompliance and the information reporting associated with these offshore accounts. The IRS will initially address tax noncompliance through audit examination and…

Details of the Streamlined Foreign Offshore Procedures (SFOP)

- By : Parag Patel

…for an IRS audit, the taxpayers is still subject to the possible normal audit selection. The taxpayer needs to be prepared to defend filing a SFCP and be able to…