United States

IRS LB&I Division announces six new compliance campaigns

TAX ALERT  | 

The IRS Large Business & International (LB&I) Division recently announced six new compliance campaigns. LB&I has been steadily adding campaigns, and, to date, LB&I has announced a total of 59 campaigns. LB&I’s goal is to “improve return selection, identify issues representing a risk of non-compliance, and make the greatest use of limited resources.”

The six new campaigns are:

  1. S corporations built in Gains tax
  2. Post Offshore Voluntary Disclosure Program (OVDP) compliance
  3. Expatriation
  4. High income non-filer
  5. Erroneous refundable credits in U.S. territories
  6. Section 457A deferred compensation attributable to services performed before Jan. 1, 2009

Taxpayers should take note because these campaigns are important indicators of where the IRS will spend its audit resources.

Campaign

Practice area

Focus

Treatment stream

S corporations built in Gains tax

Pass through entities

Increasing awareness of and compliance with payment of built-in Gains tax when C corporations that convert to S corporations have a net unrealized built-in gain and sell assets within five years of conversion

Issue-based examinations, soft letters and outreach to practitioners

Post OVDP compliance

Withholding and international individual compliance

Addressing tax noncompliance related to former OVDP taxpayers’ who are non-compliant with their foreign income and asset reporting requirements

Soft letters and examinations

Expatriation

Withholding and international individual compliance

U.S. citizens and long term residents (lawful permanent residents in eight out of the last 15 taxable years) who expatriated on or after June 17, 2008, and may have failed to meet their filing requirements and tax obligations

Outreach, soft letters and examination

High income non-filer

Withholding and international individual compliance

U.S. citizens and resident aliens who have not filed a tax return, particularly those that did not receive a W-2, Form 1099 or a foreign equivalent of either form

Examinations

U.S. territories-erroneous refundable credits

Withholding and international individual compliance

Bona fide residents of U.S. territories who erroneously claimed refundable credits on Form 1040

Outreach and examinations

Section 457A deferred compensation attributable to services performed before Jan. 1, 2009

Northeastern compliance practice area

Compensation attributable to services performed before Jan. 1, 2009 that was deferred under a nonqualified deferred compensation plan and was not included in gross income

Issue-based examinations

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