Wednesday, December 12, 2018

Doctor Prescribes Fake Documents & Now Pleads Guilty To Obstructing The IRS - Really?

According to DoJ. a medical doctor pleaded guilty to corruptly obstructing the due administration of the internal revenue laws on December 11, 2018.

According to court documents, Dr. Joseph Jacob Hummel purchased the home of an acquaintance, only to be repaid for the purchase a short time later. 

When Special Agents with Internal Revenue Service-Criminal Investigation (IRS) interviewed Dr. Hummel about this real estate transaction, he falsely stated that he rented the property to the original owner and then sent the agents a sham lease, supporting this statement.

Hummel faces a maximum sentence of three years in prison.  He also faces a period of supervised release and monetary penalties. Sentencing is scheduled for March 26, 2019.

Have a Criminal Tax Problem?
Contact the Tax Lawyers at 
Marini & Associates, P.A.
for a FREE Tax Consultation contact us at
or Toll Free at 888-8TaxAid (888 882-9243)


DC Hold That Limit on FBAR Penalty is an Annual Limit

A district court has held that the monetary limit on the penalty for willfully failing to file a Report of Foreign Bank and Foreign Accounts (FBAR) is an annual one. The court found that, in reaching this conclusion, it was not required to consider the ongoing split of court opinions in previous cases about whether the limit on the penalty is defined by statute or reg.

 There is now disagreement amongst district courts as to whether the 2004 statutory amendment invalidated the $100,000 cap established by
31 C.F.R 1010.820. Among the courts that have held that the statutory amendment merely increased the maximum but did not require IRS to in any case impose the maximum, and thus held that the limit contained in the reg. was the maximum penalty that IRS could impose, were Colliot(DC TX 2018) 121 AFTR 2d 2018-1834, and Wadhan, (DC CO 2018) 122 AFTR 2d 2018-5208. However, there is also Norman, Ct. Fed. Cl. Dkt 15-872, where the Court held that the taxpayer Norman was liable for the FBAR willful penalty and this Court rejected the Colliot holding that the FBAR willful penalty was limited to a maximum of $100,000, because the regulations had not been changed to reflect the statutory amendment increasing the maximum FBAR willful penalty. 

The taxpayer, Mr. Shinday had foreign bank accounts for which he was required to file an FBAR, and for which he didn't file an FBAR, for 2005 through 2011. The balances in those accounts, for 2005 through 2011, varied from approximately $380,000 to $1,031,548.

IRS assessed willful FBAR penalties against Shinday for the tax years 2007 to 2011. The aggregate amount of these penalties was $257,888, which represented 25% of the combined 2006 year-end balance of Shinday's foreign bank accounts, which equaled $1,031,548.  This total was then divided equally, in order to apply penalties equally for each year starting in 2007 and ending in 2011.

Shinday argued that IRS's claim to reduce Shinday's penalty assessments to judgment must be dismissed because IRS assessed penalties which exceeded the $100,000 penalty cap established by 
31 C.F.R. 1010.820.  Relying on Colliot and Wahdan, Shinday contended that 31 C.F.R. 1010.820's cap controls because it is consistent with 31 U.S.C. 5321, the statute under which it was issued.
Court OKs IRS calculation. The court approved IRS's calculation.

The court said that neither of the cases cited by Shinday supported his position. In Colliot, the court found that IRS could not assess FBAR penalties exceeding the $100,000 cap promulgated under
31 C.F.R. 1010.820, but that court only considered FBAR penalties that exceeded $100,000 in a given year. Similarly, the court in Wahdan concluded that IRS "is not empowered to impose yearly penalties in excess of $100,000 per account."

The court here said that the facts of Colliot and Wahdan were thus inapposite to this case because the five penalties assessed against Shinday were individually all less than $100,000. Although in the aggregate the penalties against Shinday totaled $257,888, the yearly, individual penalties were each approximately $51,578. Each time Shinday willfully failed to timely file an FBAR, IRS assessed a penalty. The penalties were imposed for separate, if successive, alleged FBAR violations resulting from Shinday' failure to file FBAR reports in 2007, 2008, 2009, 2010, and 2011.

Finally, the court noted that, in arriving at its decision, it did not need to reach the issue of whether
31 USC 5321 invalidates the Department of Treasury's implementing regs., because there was no year in which Shinday was penalized more than $100,000. (Shinday DC CA 12/4/2018 122 AFTR 2d ¶ 2018-5483).

Have Undeclared Income from an Offshore Account?
Want to Know Make Sure You Are Not Over Penalized?
Contact the Tax Lawyers at 
Marini& Associates, P.A. 
for a FREE Tax Consultation Contact Us at:
Toll Free at 888-8TaxAid (888) 882-9243

Friday, December 7, 2018

Marini & Associates, P.A.
wishes you
a Merry Christmas,
Happy Hanukkah and a
Happy and Prosperous New Year !
Tax Litigation
Tax Collections & Tax Planning
¡Feliz Navidad y Prospero Año Nuevo! 

Wednesday, December 5, 2018

Move Over Lebron - IRS Launches Instagram Account to Help Taxpayers

According to IR-2018-237 on November 30, 2018 the Internal Revenue Service announced its debut on Instagram, adding this platform to its social media portfolio.

The IRSNews account ( will provide taxpayers the latest information on a variety of topics as taxpayers face numerous tax law changes for the upcoming 2019 filing season related to the Tax Cuts and Jobs Act. The IRS Instagram account will share taxpayer-friendly information to help people Get Ready for the upcoming tax season. And it will provide the latest tax scam information to help support the Security Summit initiative, a joint effort between the IRS, states and the nation’s tax industry to combat tax-related identity theft.

“The addition of Instagram is another step for the IRS to share information more widely and reach additional taxpayers,” said IRS Commissioner Chuck Rettig. “This platform will help make people aware of important options they have during the upcoming filing season as well as other tax information they might not be aware. The IRS will continue to work with and help taxpayers in as many ways possible.”

Research shows that more than 70 percent of U.S. young adults between 18 and 24 are active on Instagram. The IRS plans to use Instagram to better serve this segment of the population, sharing content on tax topics that affect all taxpayers.

The IRS Instagram account will also periodically share information in Spanish and other languages.

Have an IRS Tax Problem? 
Contact the Tax Lawyers at 
Marini & Associates, P.A. 
for a FREE Tax HELP contact us at:

Toll Free at 888-8TaxAid (888) 882-9243


SC Will Not Review Start Date of 30 Day Levy Notice

The Supreme Court has declined to review the DC Circuit's affirmance of a Tax Court decision that, for purposes of determining whether IRS has met the requirement in Code Sec. 6330(a) that it notify the taxpayer by mail no less than 30 days before the date of a levy that the taxpayer has the right to a collection due process (CDP) hearing, the 30 days is measured from the mailing date of the IRS notice.

IRS generally may not levy against a person's property or right to property unless it gives the person a notification in writing of his right to, and the opportunity for, a pre-levy CDP hearing with IRS. (Code Sec. 6330(a)(1), Reg. § 301.6330-1(a)(1)).

One way in which that notice may be made is by sending the notice by certified or registered mail at least 30 days before the day of the first levy with respect to the unpaid tax for the tax period. Hand delivery within that same time frame is also allowed. (Code Sec. 6330(a)(2)).

In an effort to collect the taxpayer's Mr. Weiss's unpaid tax liabilities by levy, IRS attempted to hand-deliver the notice at Weiss's residence during a field call on February 11 but, deterred by Weiss's dog, was unsuccessful.

Two days later, IRS initiated the mailing of the notice by certified mail to Weiss's last known address. IRS did not generate a new levy notice dated February 13 but rather enclosed in the envelope the original notice dated February 11.

The taxpayer challenged the timeliness of the levy notice in the Tax Court. The Court held that the mailing date, February 13, was the relevant date from which the 30-day period was measured.

The Circuit Court for the District of Columbia, affirming the Tax Court, has held that the mailing date, February 13, controlled the issue. The Court reasoned that the statute looks to the date the notice is sent; in the context of a mailed notice, "sent" means "mailed."

On Dec. 3, 2018, the Supreme Court refused to review the DC Circuit's decision. Accordingly, that decision is now final.

Have an IRS Tax Problem? 
Contact the Tax Lawyers at 
Marini & Associates, P.A. 
for a FREE Tax HELP contact us at:

Toll Free at 888-8TaxAid (888) 882-9243


Panama Papers Lead To Indictment Of 4 (3 Professionals & 1 Client)

According to Law360, New York federal prosecutors announced the indictment of a lawyer and three other men on December 4, 2018 on charges of wire fraud, tax evasion and money laundering, tying the case to the 2016 leak of documents from the law firm Mossack Fonseca called the Panama Papers.

Law enforcement officials described the charges against attorney Ramses Owens, who remains at large, and investment manager Dirk Brauer, accountant Richard Gaffey and businessman Harald Joachim von der Goltz, all of whom have been arrested, as a warning to would-be tax criminals and those who would help them. The defendants could face decades in prison.

“Law firms, asset managers and accountants play key roles enabling entry into the global financial system,” Assistant Attorney General Brian Benczkowski said in a statement.  
“The Charges Announced Today Demonstrate Our Commitment to Prosecute Professionals Who Facilitate Financial Crimes across International Borders and the Tax Cheats Who Utilize Their Services.”
According to the government, Owens and Brauer, who worked for a firm called Mossfon Asset Management SA with close ties to Owens’ law firm, have spent decades helping U.S. citizens avoid their tax obligations. One such client was von der Goltz, although four other unnamed clients are referred to in the indictment. Gaffey allegedly helped von der Goltz and at least one other client of of Mossack Fonseca.

With help from Mossack Fonseca, the government claims, clients like von der Goltz used shell companies in offshore jurisdictions with strict financial secrecy laws that were technically owned by sham foundations to hide untold amounts of money from the IRS. Von der Goltz falsely told prosecutors that his 102-year-old mother, who lives in Guatemala, was the beneficial owner of companies linked to him, the government claims.

The defendants, who range in age from 50 to 81, face a total of 11 counts. Two of the counts are against von der Goltz alone for allegedly providing false statements to the government after an unnamed representative of a U.S. law firm reached out to the U.S. Department of Justice after the Panama Papers disclosure and offered to set the record straight, according to the indictment.
Authorities said the investigation was a joint effort of investigators at the IRS, the FBI and the U.S. Department of Homeland Security.
“The Unsealing Of This Indictment Sends A Clear Message That IRS-CI Is Actively Engaged In International Tax Enforcement, And More Investigations Are On The Way,”
said Don Fort, who leads the tax agency’s criminal investigations unit. “Cases like this help maintain the public’s confidence in our tax system by letting them know that we investigate and prosecute those who evade their tax obligation.” The case is U.S. v. Owens et al., case number 1:18-cr-00693, in the U.S. District Court for the Southern District of New York.

Have a Criminal Tax Problem?
Contact the Tax Lawyers at 
Marini & Associates, P.A.
for a FREE Tax Consultation contact us at
or Toll Free at 888-8TaxAid (888 882-9243)


Saturday, December 1, 2018

IRS Update Makes Voluntary Disclosures For Foreign Accounts More Expensive

The cost of voluntarily disclosing previously unreported offshore assets to the IRS avoid criminal prosecution, just got more expenses under an updated procedures the revenue agency released on November 29, 2018.
IRS deputy commissioner for services and enforcement Kirsten Wielobob issued a memorandum on November 20, 2018 that the IRS posted publicly Thursday, November 28, 2018, which outlines the process for all voluntary disclosures following the closing of the IRS’s Offshore Voluntary Disclosure Program on Sept. 28, 2018. She noted in the memo that the 2014 OVDP began as a modified version of the OVDP that launched in 2012 after earlier programs in 2009 and 2011. 

Voluntary disclosure is a long-standing practice of the IRS to provide taxpayers with criminal exposure a means to come into compliance with the law and potentially avoid criminal prosecution. See I.R.M. This memorandum updates that voluntary disclosure practice. Taxpayers who did not commit any tax or tax related crimes and do not need the voluntary disclosure practice to seek protection from potential criminal prosecution can continue to correct past mistakes using the procedures the updated Voluntary Disclosure Program or by filing an amended or past due tax return. When these returns are examined, examiners will follow existing law and guidance governing audits of the issues.

“These programs were designed for taxpayers with exposure to potential criminal liability or substantial civil penalties due to a willful failure to report foreign financial assets and pay all tax due in respect of those assets,” Kirsten Wielobob wrote.

 “They Provided Taxpayers With Such Exposure Potential Protection from Criminal Liability and Terms for Resolving their Civil Tax and Penalty Obligations.”

The new procedures are effective for all disclosures after Sept. 28, 2018. The penalties have continue to increase, since the original OVDI program began in 2009.
The process begins with taxpayers requesting “pre-clearance” for participation from the agency’s Criminal Investigation Division, after which civil examiners determine tax liabilities and penalties. The civil penalties, which may be assessed for fraud or the fraudulent failure to file income tax returns, could be higher than what would have been assessed under the old Offshore Voluntary Disclosure Program that the IRS ended Sept. 28.

For all cases where CI grants preclearance, taxpayers must then promptly submit to CI all required voluntary disclosure documents using a forthcoming revision of Form 14457. This form will require information related to taxpayer noncompliance, including a narrative providing the facts and circumstances, assets, entities, related parties and any professional advisors involved in the noncompliance.

Once CI has received and preliminarily accepted the taxpayer’s voluntary disclosure, CI will notify the taxpayer of preliminary acceptance by letter and simultaneously forward the voluntary disclosure letter and attachments to the LB&I Austin unit for case preparation before examination. CI will not process tax returns or payments.
The updated Voluntary Disclosure Procedures also provide for various outcomes depending upon the extent of taxpayers’ cooperation with the IRS.

If the Parties Are Unable to Reach an Agreement, IRS Examiners Have the Discretion to Increase the Disclosure Period to the Full Duration of Noncompliance and Assert Maximum Penalties with the Approval of Management.

Civil penalties for fraud are to be applied to the tax year with the highest tax liability, but in the absence of an agreement, they could be applied to a greater number of years within the six-year scope.
Do You Have Undeclared Income From
An Offshore Bank or Financial Advisor?
Is Your Name Being Handed Over to the IRS?
Want to Know Which Remaining IRS Program is Right for You? 
Contact the Tax Lawyers at 
Marini & Associates, P.A.   
for a FREE Tax Consultation contact us at:
Toll Free at 888-8TaxAid (888) 882-9243