The Internal Revenue Service (IRS) recently released its top-12 list of tax scams to watch for in the current tax year, an annual list called the "Dirty Dozen." Topping the list in 2018 are the perennial telephone and phishing scams, identity theft, and return preparer fraud. Also included are acts such as falsely padding deductions, making improper claims for business credits, and falsifying income. For the complete list and information from the IRS on how to protect yourself from tax scams, click here.
The Internal Revenue Service (IRS) estimates it is holding about $1.1 billion in unclaimed federal income tax refunds for approximately 1 million taxpayers who did not file a 2014 federal tax return. The deadline to file a 2014 return to collect any refund due is this year's tax deadline, Tuesday, April 17, 2018.
For those taxpayers who may still be on the fence about whether to voluntarily disclose offshore assets, the time to decide is now! The Internal Revenue Service (IRS) has announced that the 2014 Offshore Voluntary Disclosure Program (OVDP) will close on September 28, 2018.
The Internal Revenue Service (IRS) has included phone scams on its "Dirty Dozen" list of common tax scams for the 2018 filing season. Taxpayers should be aware of criminals posing as IRS agents and making threatening or aggressive demands for money through phone calls. According to the IRS, this is the time of year when they see a jump in the number of reports of scam phone calls threatening potential victims with arrest, deportation, or license revocation if payment demands are not met immediately.
The Internal Revenue Service (IRS) is keeping tax-related identity theft on its "Dirty Dozen" list of tax scams to watch for in 2018, despite a significant decline in this type of crime in recent years. Tax-related identity theft is the act of using a stolen taxpayer identification number to file a fraudulent tax return and claim a refund. In 2017, the IRS received 242,000 reports of identity theft, compared to 401,000 reports in 2016. This is due in part to the Security Summit partnership, launched in 2015, which has enacted various safeguards to prevent tax-related crimes. However, identity theft remains on the IRS' list of most common tax-related crimes. To read suggestions to protect yourself and your business from identity theft, click here.
The Internal Revenue Service (IRS) kicked off its annual "Dirty Dozen" awareness campaign about common tax scams for 2018 with a reminder that phishing schemes are still a serious threat to personal information safety, and are evolving. The most recent variation on phishing (previously described here) involves an unexpected deposit into the bank account of a target. Criminals are filing fraudulent tax returns, and directing refunds to be deposited into real bank accounts of victims. The criminals then call the victim who received the deposit and demand the return of the funds as erroneous.
The Internal Revenue Service (IRS) has created a special landing page to share information with tax professionals concerning the effects of the Tax Cuts and Jobs Act of 2017. Click through for the latest press releases, publications, and IRS legal guidance on the changes made by the latest tax reform: www.irs.gov/newsroom/tax-reform
The Treasury Inspector General for Tax Administration (TIGTA) recently released a report finding that the Internal Revenue Service (IRS) has failed to notify the majority of individuals they found to be victims of employment identity theft. When an identity thief uses another individual's information to obtain employment, the victim may have taxes computed based on income they did not personally earn, and may experience other difficulties. The IRS has a computer-based process to notify victims of the issue, but due to a programming error related to a decision to notify only newly identified victims, the IRS failed to notify over 450,000 individuals for processing year 2017. In addition, over 15,000 individuals who did receive notice (13.5 percent of the total group notified) were not actually victims of employment identity theft.
In September, 2017, the Internal Revenue Service (IRS) issued a directive to tax examiners concerning research expenditures for business entity taxpayers with assets of at least $10 million and that follow Generally Accepted Accounting Principles (GAAP) to prepare certified financial statements and records for research costs following ASC 730. Taxpayers are provided a federal credit for increasing research activities under IRC Section 41; the state of California has decided to follow the same directive for California business entity taxpayers.
The Internal Revenue Service (IRS) recently announced that taxpayers who reside or have a business in the California counties that were affected by the recent wildfires, flooding, mudflows, and debris flows may qualify for federal tax relief. Certain deadlines may be extended and penalties may be abated for taxpayers located in the covered disaster area. Taxpayers located outside the disaster area, but whose records necessary to meet a federal tax deadline are in the covered area, may also qualify for relief. For more information, click here.