From the Tax Law Offices of David W. Klasing - What is the IRS Targeting This Year (2021)?

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Tax Law Offices of David W. Klasing, PC

Jun 30, 2021, 06:37 ET

IRVINE, Calif., June 30, 2021 /PRNewswire/ -- The IRS is expected to target several specific issues in the upcoming year. These focuses will include developing areas with little oversight such as gambling and cryptocurrency, schemes utilizing the federal government's COVID-19 relief packages, and bad-faith tax preparers engaged in schemes without the knowledge of their clients.

Biggest IRS Targets of 2021

Why hire the Tax Law Offices of David W. Klasing to represent you in an Audit?

The IRS always sets out with enforcement goals in mind. Knowing who might be subject to more rigorous scrutiny can help you prepare for an intrusive criminal tax investigation or audit. With that in mind, here are some of the most likely categories that the IRS will focus on in the coming year:

COVID-19 Relief Tax Schemes
The federal government is shelling out massive amounts of tax relief to businesses impacted by the pandemic. As a result, the IRS as a watchdog of the national treasury will be watching business deduction claims paid with PPP funds closely. The IRS only allows deductions for payments of certain eligible expenses. If your business has already or will plan to claim deductions for expenses paid with funds from the PPP, you should know that the IRS will most likely examine these claims closely. To make sure that you are protected, contact the California criminal tax defense attorneys and CPAs at The Tax Law Office of David W. Klasing today. Schedule a consultation by calling our offices at (800) 681-1295 or scheduling online here.

Gambling
As a result of a sequence of legalization actions across the country in the recent past, online gambling has swelled in popularity nationwide. With popularity comes IRS scrutiny. The agency has identified tax compliance related to online gambling as a priority for audit and criminal tax investigation.

Healthcare
The IRS will be looking for healthcare tax fraud from multiple angles this year. Providers may be investigated on issues such as fraudulent billing statements for the sake of deductions, pharmaceutical diversion, and fraud in nursing homes and chiropractors' offices. The year naturally brings more national intrigue into the function of the medical system. Expect the focus of the IRS to mirror that of the general public.

Foreign Assets
Evaded taxes and purposely omitted offshore foreign information reporting related to funds and investments hidden away in offshore jurisdictions is one of the largest banes of the IRS's existence. It is estimated that billions of dollars escape the tax grasp of the U.S. government every year due to complex financial plots involving entities created outside of the United States. But now that the agency is honing its ability to detect even the most sophisticated of offshore evasion schemes, they have made no secret that they hope to right that wrong. Pay close attention to the FBAR and other offshore foreign information filing requirements and realize that the U.S. taxes the worldwide income of its tax residents even if the offshore income is taxes by a foreign government.

The "Dirty Dozen" Common Tax Schemes
The Criminal Investigations Division of the IRS publishes the "Dirty Dozen," a list of a dozen different types of specific tax schemes and other criminal activities that will be investigative priorities over the coming calendar year. This year's list contains the following:

Fraudulent charities
Fake payments with repayment demands.
Bad-faith tax preparers
Targeting of unreported foreign income and omitted foreign information returns.
Offer in Compromise Mills
Human Resources scams
Ransomware
Phishing
IRS impersonation
Senior fraud
Nursing home fraud
Social media

Cryptocurrency
You might be seeing a trend developing: when an activity becomes more popular, so too does IRS scrutiny. Even though the cryptocurrency market is flooded with innovation and complexity, the government maintains its determination to ensure compliance across all spheres.

All cryptocurrency transactions must be carefully tracked and recorded by the taxpayer to veritably report income on federal returns. If you are invested in cryptocurrency and are unsure how to report your holdings to the federal government, contact the Tax Law Offices of David W. Klasing at (800) 681-1295.

Small Businesses
Think your small business is safe? The IRS established a brand-new division in 2020 specifically to concentrate efforts on investigating small businesses. The division is specifically mandated to investigate suspicious returns from businesses with assets valued at no more than $10 million as well as independent contractors. The key issues of the division will be underreporting and nonpayment. Expect this new division to try to prove itself early.

Bad-Faith Tax Preparers
This category was mentioned in the "Dirty Dozen," but deserves specific mention, because all signs point to a significant government crackdown soon. The IRS aggressively pursues abusive preparers by way of the Return Preparer Program, established for this exact purpose. Remember, even if your tax preparer is found to be criminally liable, your name is on the return, and you are ultimately responsible for any unpaid tax. The IRS views bad-faith preparers as an opportunity to investigate both the preparer and the taxpayer. If you believe you have been employing the services of a tax return preparer who may be criminally liable, it is in your best interest to contact the Tax Law Offices of David W. Klasing so that we can shore up your defenses against the IRS. It's never too early.

Call The Tax Law Offices of David W. Klasing Today
If you are worried about an IRS investigation in 2021, you should enlist the assistance of the professionals at The Tax Law Offices of David W. Klasing. We will work hard to ensure you are or become compliant in a manner that you may avoid civil or criminal tax fraud. Call our offices today at (800) 681-1295 to set up a consultation or schedule online here.

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Public Contact: Dave Klasing Esq. M.S.-Tax CPA, [email protected]

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