Brazen tax evasion
One of the more shocking cases closed by the IRS in September involved a former CEO, who was sentenced to a year in prison and ordered to pay more than $15 million in restitution after he falsified millions of dollars of personal expenses as deductible business expenses.
The rich tax cheat used his unlawful proceeds to build a 51,000-square-foot mansion, featuring an outdoor pool and pool house; and tennis, basketball and bocce courts. His greed didn’t stop there. The IRS found he had falsified millions of dollars of expenses for luxury vehicles, artwork, country club memberships and homes for his children.
Another case targeted a restaurant owner who filed false tax returns and skimmed more than $670,000 from his business. He then spent $502,000 of his illegally obtained funds on gambling.
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Historic crackdown on tax cheats
These high-end collection cases are part of the IRS’s targeted sweep of 1,600 millionaires who owe hundreds of millions of dollars in taxes — in an effort to “restore fairness in tax compliance.”
Using federal funding granted through the Inflation Reduction Act, the IRS is targeting high-income earners who owe at least $250,000 each in back taxes, large business partnerships with assets of roughly $10 billion on average — including hedge funds, real estate investment partnerships, large law firms and other industries — and promoters abusing the nation’s tax laws.
“Prior to the Inflation Reduction Act, more than a decade of budget cuts prevented the IRS from keeping pace with the increasingly complicated methods the wealthiest tax taxpayers used to hide their income and evade their paying their fair share of taxes,” IRS Commissioner Daniel Werfel told reporters, as reported by Business Insider.
“Inflation Reduction Act funding gives us the ability to take swift and aggressive action to improve compliance and close the tax gap.”
More: Best tax software to file with
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