IRS foreign tax audits: Important updates for 2017

IRS foreign tax audits: Important updates for 2017

Due to massive budget cutbacks and a reduced workforce, the IRS Large Business and International (LB&I) division of the IRS had to radically rethink how to apply scarce resources to compel compliance and increase inbound revenue. In August, we talked about the IRS's International Practice Units (IPUs). The IPUs aren't a group of people, but rather audit modules on how to identify and process issues ripe for large penalties. Since then, the IRS has added more IPUs. Additionally, the IRS launched a series of campaigns. Some of these provide an effective way to lump together as many IPUs as possible in an audit examination. This maximizes the IRS's Return on Investment. These are the 13 newly announced LB&I campaigns: 1. IRC 48C Energy Credit Campaign 2. Domestic Production Activities Deduction, Multi-Channel Video Program Distributors (MVPD’s) and TV Broadcasters 3. Micro-Captive Insurance Campaign 4. Related Party Transactions Campaign 5. Deferred Variable Annuity Reserves & Life Insurance Reserves IIR Campaign 6. Basket Transactions Campaign 7. Land Developers - Completed Contract Method (CCM) Campaign 8. TEFRA Linkage Plan Strategy Campaign 9. S Corporation Losses Claimed in Excess of Basis Campaign 10. Repatriation Campaign 11. Form 1120-F Non-Filer Campaign 12. Inbound Distributor Campaign 13. OVDP Declines-Withdrawals Our position is that the public and the tax profession industry are largely ignorant on how even "simple" international affairs become mind-bogglingly complicated. This position is supported by these campaigns and IPUs which serve to educate IRS auditors who themselves are unaware of what full compliance looks like, and the method by which to legally assess international tax penalties. IRSMedic, the Law Offices of Parent & Parent LLP 888-727-8796 info@irsmedic.com Serving US taxpayers around the world https://youtu.be/A8CWFnwLD6s IRS Medic