Law Feed

Photo by RODNAE Productions Welcome to the continuation of the ol' blog's Tax Crime Weekend! Yesterday's post featured efforts to end abusive tax schemes and bring their promoters to justice. Today's post expands on the legal reckoning theme. The Internal Revenue Service's Criminal Investigation division, known as IRS-CI, recently revealed its top 10 cases of 2022. Wide variety of schemes, one outcome: The tax evasion attempts included Ponzi pyramid schemes, fake businesses, COVID-19 fraud, bogus tax credit, and even a reality TV couple. And more. Despite the diversity of their criminal tax acts, they shared one thing. They got caught.... Read more →


The Rev. Dr. Martin Luther King in Washington, D.C., in 1963 where he delivered his "I Have A Dream" speech. (Photo via Wikimedia) On this Martin Luther King, Jr. Day federal holiday, the focus once again is on public service. It's a way to honor The Rev. Dr. King's commitment to helping those who need it the most. It's also a time when we rightfully recall the civil rights leader's most famous speech, his delivery of his "I have a dream" vision of equality in Washington, D.C., on Aug. 28, 1963. But King also knew that hard, practical work was... Read more →


One of the forms in the long list of tax documents you need to file your 2022 return is the 1099-K. This form has been used for years for third-party payment processors — for example, PayPal, Amazon, eBay, Facebook Marketplace, rideshare companies, and many more — to report to fund recipients the money they got during the year. The Internal Revenue Service also gets a copy so it can check the amounts that the earners report on their tax returns. Taxpayers have been getting 1099-K forms since 2012, with this initial reporting coving third-party amounts in 2011. The factors that... Read more →


The tax year is over. Long live the tax year. Taxes are, if nothing else, persistent. Sure, there are a few (or more) changes every year, even if it's only inflation adjustments. But even in years when the changes are negligible, they are back, starting to add up on the first of every January. That's why 2023 is the first By the Numbers honoree of this new year. The transition from an old to a new tax year is also the focus of this post. It's a look at six tax matters that affected or at least fascinated us in... Read more →


Nothing ever disappears on the internet. Even, or especially, tax related posts. Take the bad legal take on taxes that tops this post. It was retweeted on Sunday (Dec. 11) by, you guessed it, Bad Legal Takes. But there's no indication of when Dave Champion originally blasted out his bad tax advice. It might have been before he was barred by a federal court in 2012 from promoting a tax fraud scheme. Or maybe he's back, since this Tweet apparently went up in October. His books also are still for sale online. Either way, that item this weekend spurred a... Read more →


Not all foreign tax havens are tropical islands, but the idyllic getaways do conjure images of tax crooks enjoying isolated beaches at Internal Revenue Service's expense. (Photo by Asad Photo Maldives) Correlation does not imply causation, but in a couple of high-profile offshore tax evasion cases, it's starting to look like trying to allegedly put one over on the U.S. tax collector is not a healthy move. For the second time in four months, a defendant in an offshore tax evasion case has died. Carlos Kepke, a Houston-based tax attorney who was indicted on charges that he helped hide $225... Read more →


Right now, a lot of folks are thinking they should have been like Larry. The Larry they wished they'd emulated is Larry David, known for his curmudgeonly television character. He tweaked that persona to become a naysayer on several inventions that, per the commercial's Super Bowl debut, changed the world. The television ad for FTX crypto exchange advised viewers, "Don't be like Larry" and instead invest in digital currency via the company. On Friday, Nov. 11, FTX filed for bankruptcy following reports that between $1 billion to $2 billion of FTX customer funds disappeared. Continuing crypto troubles: This is just... Read more →


The Internal Revenue Service's Criminal Investigation (IRS-CI) division is doing its part to close the Tax Gap, which now sits at $496 billion in uncollected tax. The IRS' law enforcement group's recently released annual report notes that its agents initiated more than 2,550 criminal investigations, identified more than $31 billion from tax and financial crimes, and obtained a 90.6 percent conviction rate on cases that were prosecuted. Much of IRS-CI's success during the 2022 fiscal year, which ended on Sept. 30, was due to its increased cooperation and partnership with its global counterparts to combat tax and financial crimes worldwide.... Read more →


The October filing extension deadline, which falls on Oct. 17 this year since the 15th is Saturday, is less than a week away. The Internal Revenue Service is waiting on the uber procrastinators to get their filings in by next Monday. But the IRS isn't the only federal financial office awaiting postponed documents. FinCEN also demands extended FBAR filings be in by Oct. 17. Taxable money, but not an IRS issue: FBAR, or Report of Foreign Bank and Financial Accounts, is how FBAR information is the federal government's way of tracking foreign bank and financial accounts owned by U.S. taxpayers.... Read more →


The Internal Revenue Service saw its largest tax fraud case ever end on Aug. 5 when Robert T. Brockman died. The 81-year-old billionaire had been charged with 39 criminal financial crimes, including tax evasion. Federal investigations alleged that Brockman was part of an elaborate offshore tax fraud scheme that cheated the U.S. Treasury out of more than $1.4 billion in taxes, penalties, and interest. While the criminal case is over, legal actions in civil and tax courtrooms to recoup the allegedly unpaid taxes (and add-on charges) continue. Special tax action to protect collection: As part of that process, the IRS... Read more →


Just more than a year ago, a Parkville, Missouri, man pleaded guilty to charges filed in two separate federal investigations. One was a case involving conspiracy to commit wire and major program fraud. The defendant admitted to his role in a $335 million scheme to defraud federal programs that award contracts to firms owned by minorities, veterans, and service-disabled veterans. The second charge was one of tax evasion to the tune of $615,847. The Missouri man confessed to claiming fraudulent business expenses on his 2016 tax year return and filing false returns from 2013 to 2016. Last Thursday, Sept. 22,... Read more →


I suspect everyone involved in this ceremonial big check delivery is much happier than they appear in this Secret Service photo. COVID-19 federal financial assistance was a boon to many businesses that struggled during the pandemic's height. Now it's Uncle Sam who's getting relief. The U.S. Secret Service today announced the return of around $286 million in Economic Injury Disaster Loans (EIDL) to the Small Business Administration (SBA). The loans were granted based on fraudulently submitted applications that contained fabricated or stolen employment and personal information. Debit cards to hide, move funds: The investigation was initiated by the Secret Service's... Read more →


Barclays Bank building in Madrid (Photo by M.Peinado from Alcalá de Henares, España - 001782 - Madrid, CC BY 2.0) It's not a crime to put your money into legitimate foreign financial institutions. However, if the amount meets a certain threshold, you are required to report that money to the U.S. government. When U.S. taxpayers ignore this process, officially known as filing of a Report of Foreign Bank and Financial Accounts, or FBAR, they can face costly consequences. That's the case in the FBAR collection complaint filed Aug. 15 by federal officials seeking judgment against the defendant who, per the... Read more →


Photo by Kay Bell Millions of Americans are displaying the U.S. flag today. Some, like my neighbors shown in the photo atop this post, planted poles for Old Glory and replicas in their yards, at the beginning of the long Independence Day holiday. Others fly the Stars and Stripes every day. If you're inclined to fly the U.S. flag any time, the following infographic has some tips from Uncle Sam himself — OK, USA.gov — and the Flag Code, officially Title 4, Chapter 1 of the U.S. Code. More flag tips and tidbits: Want to impress friends and family at... Read more →


Photo by EKATERINA BOLOVTSOVA Dealing with the normal ups and, too frequently of late, downs of the stock market is enough of a worry. But things can quickly go even further downhill when crooks use fake investments to defraud victims. Not surprisingly, those criminals often get greedier and try to cheat Uncle Sam, too. Such overreach, however, didn't work out well for one California man. Robert Louis Cirillo of Chino Hills pleaded guilty in federal court on Tuesday, June 28, to charges of defrauding investors of $3.2 million, as well as scamming an elderly man of hundreds of thousands of... Read more →


Photo by Andrea Piacquadio I'm later than usual posting today because the hubby and I finally cleaned a room that we've ignored for way too long. That meant it took longer than if we'd just dusted a bit more regularly. That's why I'm thinking of hiring a cleaning person. OK, I probably won't. I do think about it every time we do some major cleaning job, since I find housekeeping a total drag. Just ask the hubby. But I'm not really one for people I don't really know being in my house. Plus, if we do hire cleaning help, we... Read more →


A group working to repeal Washington state's recently enacted capital gains tax has abandoned its effort. It's not that the anti-tax group has changed its collective mind. It's still firmly against the tax. Rather, it has decided to rely on the courts to continue to rule that the levy is unconstitutional. Income tax issues: Washington, which is one of the nine states without an income tax, enacted a capital gains tax in 2021. That, said opponents, is an income tax, which is against the state's constitution. It took the matter to Evergreen State voters in a nonbinding ballot initiative last... Read more →


The Internal Revenue Service's Whistleblower Office marked its 15th anniversary in fiscal year 2021 by making 179 awards to whistleblowers totaling more than $36 million. "Whistleblower claim numbers assigned in FY 2021 grew by 55% year over year, the second highest level of new claim numbers in the history of the program and claim closures also increased by 13%," wrote John Hinman, director of the IRS Whistleblower Office, in the introduction to the office's 2021 Annual Report to Congress, released on June 10. Those tips led to the IRS collecting in fiscal 2021 more than $245 million, which includes almost... Read more →


U.S. Continental Navy ship Alfred at its commissioning at Philadelphia on Dec. 3, 1775, captured in this oil painting by W. Nowland Van Powell. America's earliest sailors also were the new nation's first whistleblowers. (Image courtesy Naval History and Heritage Command) Memorial Day and its surrounding weekend days are to honor those in the armed forces who gave their all to protect us and our country. But, thank goodness, the ultimate sacrifice isn't required in all cases. Sometimes other forms of protection are just as necessary to protect us and society at large against fraud, waste, and abuse of power.... Read more →


The 16-year tax fight between a former pizza franchise mogul and the state of Kansas is over. The Sunflower State owes Gene Bicknell $63 million. At least that's the amount that Bicknell, who at one time owned the most Pizza Huts in the world, says he's due from the Kansas Department of Revenue (KDOR) after it erroneously taxed him as a Kansas resident when he lived in Florida. Kansas vs. Florida tax residence status: Bicknell's legal tax residency was at the heart of the multimillion-dollar tax matter. The KDOR said Bicknell was a Kansas resident. Bicknell, however, argued that his... Read more →