By George W. Connelly The Inspector General for Tax Administration, TIGTA, has been in the news a lot lately. In addition to tracking down misbehaving IRS employees and misbehaving representatives, an important role of this organization seems to be examining every aspect of the operation of the Internal Revenue Service and publishing a critical report about … Continue reading Who Audits TIGTA?
By George W. Connelly The IRS employs many lawyers and employees of the IRS Office of Chief Counsel are its principal legal staff who number 1560, of whom about 550 work in the IRS National Office in Washington, while the balance work in offices around the country. They provide legal advice to the Commissioner of Internal … Continue reading How Does IRS Police Its Own Lawyers?
By Jonathan Prokup As discussed in a story in this morning's Tax Notes, the IRS intends to begin requesting electronic files as part of taxpayer examinations so that it can analyze the "metadata" contained in those files. Metadata, sometimes referred to as "data about data," generally shows information about a computer file, such as its … Continue reading The IRS Wants Your Metadata; Who Else Might Want It, Too?
By George W. Connelly When the IRS audits a tax return involving a business, its agents invariably get involved in questions of recordkeeping and how transactions are conducted and recorded. All too often, an IRS Examiner will suggest that a taxpayer's records are not "adequate," or that in some fashion the taxpayer is not operating in … Continue reading Where Does the IRS Get Off Telling You How to Run Your Business?
Since codification of the economic substance doctrine in March 2010, taxpayers have expressed fears that IRS will assert the doctrine unpredictably, resulting in an in terrorem effect among taxpayers because of the lack of clear authorities interpreting the doctrine and the new 40% strict-liability penalty for falling on the wrong side of it. To promote … Continue reading Will IRS Limit Exam’s Assertion of the Economic Substance Penalty? TIGTA Report Suggests Not.
By George W. Connelly For most citizens of the United States, the thought of an IRS audit is probably scarier than a root canal or a colonoscopy without anesthesia. As a result, people will be pleased to learn that the Internal Revenue Service is in fact "audited" itself, and sometimes doesn't like the results of those … Continue reading Who Audits the Internal Revenue Service?