Wednesday, April 29, 2009

Senate Passes Bill on Tax Crimes Money Laundering

UPDATE AS OF MAY 26 2009: The House version of this bill did not include the expansion of money laundering for tax crimes and the House prevailed in conference. The proposal is thus defeated for now. Senator Grassley, however, indicated that he will pursue this issue "at every available opportunity."

As I reported earlier here, DOJ Tax is promoting on the hill legislation to expand the money laundering provisions to include certain crimes - tax evasion and the § 7206 crimes (principally tax perjury and aiding and assisting). Tax Notes Today reports that the Senate passed the bill yesterday 92-4. The bill including the provision also increases funding for financial fraud investigations, including a $5 million increase for DOJ Tax which has proved to be a strong force in the IRS initiatives against offshore evasion.

This provision, if enacted, will substantially up the criminal penalty and offer the IRS an opportunity to forfeit which is typically not available for tax evasion.

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