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 this program, the IRS identified and initiated audits of some of the largest and most complicated partnership tax returns. Later, the agency used artificial intelligence

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 designation would mean that taxpayers and material advisors who participated in these CRATs would have to comply with lengthy disclosure statements or risk

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 appreciated asset through the use of an intermediary.  In recent years, the IRS has scrutinized taxpayers’ usage of MISTs, even proposing regulations that would make

In November 2023, Gray Reed Tax Partners Joshua Smeltzer and Matthew Roberts authored an article titled “Where Have All the Theft Losses Gone?” published in Taxes: The Tax Magazine.

The article discusses whether taxpayers can deduct theft losses on their tax returns for 2018-2025 after new limitations were set by the 2017 Tax Cuts

United States citizens and residents are often not aware of the myriad of foreign information return filing obligations that exist under federal tax laws.  For example, buried within the Code are reporting obligations associated with the receipt of a foreign gift and participation and ownership in foreign trusts.  The failure to file these information returns—referred

On September 8, 2023, the IRS issued a News Release suggesting that FBAR compliance investigations and audits would heat up in the near future.  For those unfamiliar with FBARs, federal law requires United States persons to file an FBAR annually if such persons have a financial interest in or signature or other authority over foreign

Recent Government actions suggest that third-party promoters and potentially hundreds of taxpayers may be entering into abusive trust arrangements aimed at unlawfully eliminating or deferring federal income taxes. Specifically, on August 9, 2023, IRS Chief Counsel issued a Memorandum on a trust arrangement known as a “section 643(b) trust.” In the Memorandum, Chief Counsel urged

For some time, the IRS has cautioned taxpayers about filing false or fraudulent ERC claims.  More recently, on September 14, 2023, the IRS issued a News Release, IR-2023-169, indicating that it would no longer process ERC claims from September 14, 2023, through “at least” December 31, 2023.  Significantly, this only relates to new ERC

On September 8, 2023, the IRS announced a multitude of compliance initiatives aimed at high-income taxpayers, partnerships, digital assets, FBARs and labor brokers.  According to the announcement, the IRS has finalized its “top-to-bottom review” of current enforcement efforts and intends to zero in on these matters in the near future.  As expected, the impetus for change—according to the announcement—was Congress’s decision to provide the IRS with additional funding through its passage of the Inflation Reduction Act (IRA).