In our last post we discussed a recent indictment filed against six individuals accused of a criminal tax fraud conspiracy. Authorities say that the individuals would steal the identities of deceased individuals and then direct returns to accounts in Florida. Checks would be cut and then the funds would be mailed to Ohio for distribution.
Tax issues can quickly become criminal matters if the IRS suspects that you willfully provided false documents in an attempt to defraud the government. Tax fraud charges can be brought against individuals for a variety of reasons including omissions to tax returns, falsified records, and failure to file taxes. It is also possible to be charged with tax fraud if you help someone submit fraudulent tax records.
In our last post we discussed the IRS' new voluntary disclosure program for 2012 and the fact that more than 33,000 taxpayers participated in the last two disclosure programs for offshore accounts. The new voluntary disclosure program is similar to the last two initiatives because it allows Miami taxpayers with hidden overseas accounts to disclose the accounts and avoid criminal penalties.
Many Miami taxpayers were relieved to learn that the IRS has decided to reopen its voluntary offshore disclosure program for individuals that have undisclosed overseas bank accounts. The IRS' 2011 and 2009 programs were very popular with Miami taxpayers and allowed many taxpayers to disclose overseas accounts to the IRS without fear of criminal tax evasion charges.
The recent spate of refund tax fraud related scams takes advantage of a flaw in the IRS' electronic filing system. The IRS' system will detect when two returns are filed under the same Social Security Number but the system does not match returns to employer-filed W-2 income forms until after the filing season ends. This is why the IRS fails to catch false returns filed by identity thieves but rejects the legitimate returns filed by the identity theft victims later in the tax season.
In our last post we discussed the plight of one Florida family who feels that they are being victimized by the IRS after an identity thief filed a false return using their name. Despite being the victims of fraud, the Largo taxpayers now have to deal with an audit and the IRS' withholding of their refund check. Such civil tax controversy issues are becoming increasingly common as the rates of identity theft skyrocket in Florida.
A pair of Florida taxpayers has filed what may shape up to be a large class-action lawsuit against the IRS. The Largo couple says that they are among the growing number of Floridians who cannot get tax refunds because someone stole their identity and filed a false return in their names. Tax fraud is apparently a huge issue in places such as Tampa and tax fraud victims say that they are now being victimized by the IRS.
The Internal Revenue Service and Treasury Department recently published temporary regulations which provide guidance to Miami taxpayers on the treatment of tangible property. Tangible property is generally defined as physical property as opposed to incorporeal property such as patents and copyrights. The IRS issues regulations to provide legislative guidance regarding Internal Revenue Code provisions or to address issues that arise from the tax code. The release of new regulations is significant because taxpayers who may ignore newly released regulations run the risk of becoming embroiled in a civil tax controversy.