Taxpayers who find that they are the target of an IRS tax investigation for possible criminal tax violations are presented with difficult choices that often affect the ultimate outcomes of their cases.
Archives January 2017
Understanding the Purpose of the Criminal Investigation Division of the IRS
Written by on in Tax Fraud Report.
Taxpayers who are the target of an Internal Revenue Service Criminal Investigation Division investigation benefit from an understanding of the purpose of these investigations.
Court Holds that Definition of "Willful" Is Not The Same In FBAR Civil Penalty Case As In Criminal Tax Cases
Written by on in Criminal Tax Cases.
Defendants in a FBAR penalty case argued that the Chief Counsel of the Internal Revenue Service has opined that the willfulness standard for purposes of 31 U.S.C. § 5321 is the same as the criminal standard. IRS CCA 200603026. However, the Court held that Chief Counsel Advice may not be used or cited as precedent. 26 U.S.C. § 6110(k)(3) Defendant also argued that the IRS manual stated that the definition of "willfully" was the same for criminal and civil cases. The Court held that the IRS was not bound by statements made in its manual. The Court held that the definition of "willfully" included reckless disregard for the tax laws.
District Court finds in FBAR penalty trial that the definition of willful in civil cases includes reckless disregard of tax laws. The Court found that the burden of proof in a civil FBAR penalty case was a mere preponderance of the evidence. The IRS was not bound by the opinion of General Counsel or its own manual that state that the definition of willful should be the same in civil cases as in criminal cases.
