The IRS has published a new data book, the 2011 Data Book, here, with all sorts of interesting statistics relating to its revenue enforcement function. There is all sorts of good data about the number of returns filed in the aggregate and by category, the number of audits in the aggregate and by category and other fun data facts.
The table of most interest to the readers is Table 18, titled Criminal Investigation Program, by Status or Disposition, Fiscal Year 2011. A separate pdf of that table is here. It is short table with footnotes and self-explanatory, so rather than summarize it here, I just recommend clicking the link and reading it.
For IRS Criminal Investigation statistics, see here, with further links to more detailed statistics.
Jack Townsend offers this blog on Federal Tax Crimes principally for tax professionals and tax students. It is not directed to lay readers -- such as persons who are potentially subject to U.S. civil and criminal tax or related consequences. LAY READERS SHOULD READ THE PAGE IN THE RIGHT HAND COLUMN TITLE "INTENDED AUDIENCE FOR BLOG; CAUTIONARY NOTE TO LAY READERS." Thank you.
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Tuesday, March 27, 2012
11 comments:
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There is one piece of data that I find particularly interesting.
ReplyDeleteTable 17: Civil Penalties Assessed
NonReturn Penalties Assessed (Total: 7.96 Billion)
In the 2010 data book, nonreturn penalties were $5.3Billion
I conclude/assume that FBAR penalties and the in lieu of penalties under the different VD programs are collected under this item and the differential gives some idea of the amount collected in such penalties in FY 2011. [ I assume very few cases had been closed in FY 2010, so probably only a small portion of that sum represents FBAR/VD penalties]
There is an interesting story in Bloomberg today claiming that 1/3 of prosecutors have been transferred away from the DOJ foreign bank account initiative to other assignments. Anybody have any scuttlebutt on this?
ReplyDeletehttp://www.bloomberg.com/news/2012-03-27/u-s-tax-evasion-probes-said-to-slow-as-prosecutors-transfer.html
Speculation... Maybe they went into private practice where they can make more money advising those that they were pursuing? The private sector pays better, so that would be a rationale decision, don't you think? Hummm.
DeleteFor another article on the exodus of DOJ Tax prosecutors, see Mary Jacoby, Tax Division Farms Out Lawyers, Raising Questions About Focus (Main Justice Blog 3/27/12), http://www.mainjustice.com/2012/03/27/tax-division-farms-out-lawyers-to-u-s-attorney-offices-raising-questions-about-focus/
ReplyDeleteI think it is fascinating, the internal workings of the IRS and DOJ.
ReplyDeleteWe live in times when one can buy foreign citizenship and offshore accounts for a few thousand dollars, and can escape both the IRS and the DOJ.
I am sure multimillionaires facing prosecution make that calculation. It is one thing to pay a fine (it's only money), it is another to get a criminal record and jail time/probation.
I for one welcome the development. The more taxpayers leave, the higher the burden for those who remain.
M
DeleteYour desire to make sure that American citizens who live in the US pay a higher tax load is heart warming. I confess to not being completely sure why if people with large undeclared offshore accounts buy foreign citizenship and leave the country, the tax load on those still in the country would increase since they presumably weren't paying taxes on offshore assets (and possibly some onshore assets too). But perhaps it has to do with whether they have an account in an offshore bank, an under the shore bank.
Or perhaps they are not financial professionals and hence do not feel they should be prosecuted for financial crimes. Or perhaps their ethnicity is a significant since I recollect your thoughtful opinion that the iRS/DoJ was basing their prosecutions of offshore evaders on their ethnicity.
Especially this is pretty much killing the immigrants.
ReplyDeleteWith the job market down, 401ks bloodied, home prices flattened and 0% return in savings the only investment that had done well is any inheritance or stock/real estate investment in China/India. most of the immigrants
from India/China may have some of investment/inheritance
and they all appear to be financially doomed.
They should leave the USA or not come at all...this county is anti-immigrant.
DeleteOne thing to keep in mind about such statistics is that they do not track individual cases over time. The convictions reported for one year likely pertain to investigations initiated possibly one or two years before. Therefore one cannot precisely calculate percentage of investigations resulting in conviction and so forth from the data, but can only get a ballpark estimate.
ReplyDeleteThat is an excellent park. For example, if the new prosecutions initiated in the year involved had dipped relative to, say the two preceding years, a high conviction rate could be indicated in you just looked at the year involved. Indeed, in such a circumstance, it would be possible to have a conviction rate exceeding 100%. The reverse is true as well -- i.e., if the prosecutions initiated spiked in the year involved, many of them would not have been disposed of by the end of the year and would likely result in a lower conviction rate if only the one year's data is used.
DeleteThat is why it is important to look to several years' data in order to draw conclusions. That is why just presenting one years' data is suspect. I am not sure DOJ Tax would present that data in the same way if there were a spike in prosecutions for the year. Now, I don't know whether there was a material drop in prosecutions for the year that would cause the conviction rate during the year to be very high relative to the number of prosecutions.
Jack Townsend
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ReplyDeletehttp://www.tax-defense-network-collection-action.com/collection-action/tax-defense-network-collection-action-of-the-irs-tax-lien/