6 thoughts on “New Reuters Article: IRS Bait and Switch”

1. Well, well. Not just the same ole, in my opinion. It is publicity of the VDP problems that call to question some of the narrative and gets public discussion going on something that has been hidden from the US press. Lynne Browning is on my reporter email list. I sent her the Tax Notes on this issue. I am pleased to see this, even if I might have written it differently, but I have an agenda. 🙂

2. BTW, speaking of the National Taxpayer Advocate Report Critical of IRS Implementation of Offshore Voluntary Disclosure Programs

   I saw this at Townsend blog, and commented…

   http://federaltaxcrimes.blogspot.com/2012/01/national-taxpayer-advocate-report.html

   Jack Townsend’s Conclusion
   The 2009 OVDP appears to have been a great deal for those engaged in criminal tax evasion. They were not affected by the IRS’s “clarification” that it would not consider nonwillfulness, reasonable cause, or the mitigation guidelines in applying the offshore penalty because their violations were willful and unlikely to qualify for mitigation. However, the IRS Is perceived as having “reneged on” the terms of the 2009 OVDP that would benefit taxpayers whose violations were not willful. Many felt that the IRS placed them in the unacceptable position of having to agree to pay amounts they did not owe or face the prospect the IRS would assert excessive civil and criminal penalties. This perceived reversal burdened taxpayers, wasted resources, violated longstanding IRS policy, opened the IRS to potential legal challenges, and was not properly disclosed as required by FOIA. it also damaged the IRS’s credibility. As a result, it is likely to have more difficulty gaining participation in any future settlement initiatives.

   Jack,

   You conclusion is right on point.

   I do hope Commissioner Shulman does the right thing, and affirms Nina’s Directive (TAD) due on January 26th. She deserves a medal of valor for taking the issue on, against the grain of those in this Administration who have not understood the unintended consequences of how their program was constructed and administered.

   We shall see if he gets it. I fear not. What bubble does he live in?

   I don’t think they have any idea of the damage they are doing to the US reputation in the Expat, Immigrant and non suspecting “US Person” spouse world.

   This US Expat in France is doing her best to understand it and communicate it. Not sure this was the message the IRS wanted spread around the world, or maybe they did. I just don’t know. Either way, I find it troubling, and sadly I have joined that chorus to tell folks to avoid the “US Person” designation like a plague. Is that what they wanted?

   http://bit.ly/wPrM7I

3. Don’t lose hope… The story is spreading…
   CNBC picks up the Story.
   IRS Used ‘Bait-And-Switch’ on Tax Amnesty: Watchdog
   http://www.cnbc.com//id/45958780

4. “Such taxpayers are typically those who have inherited accounts or work overseas.”

   I take issue with that how they classify you as an American, no matter what. Yeah, I know, I’m singing to the choir, but the cultural aspect just baffles me. I think they truly think that the rule you, no matter where you go in the world.

5. Yes they do! 🙂

6. “Unfortunately for the many still non-compliant taxpayers, with many thousands of secret Swiss accounts about to be sent to the U.S. by 11 banks, an informed voluntary disclosure decision better be made real soon.”

   The article makes a good point about the IRS being untrustworthy because of the “bait and switch” but someone reading the above would get the idea that all those “non-compliant” taxpayers are rich american residents with hidden foreign accounts in Switzerland, (although many have reason to be felt sorry for (ie holocost victims)) There is really no recognition of the many “non-compliant” overseas residents with ordinary accounts who owe no tax but are caught in the net.

   I doubt this will get a lot of sympathy in the “homeland” where most people are probably not going to terribly concerned if a “rich tax evader” has to pay more than he thought he would. Unfair yes, but won’t be seen that way by lots of middle class Americans.