Cash reporting required despite attorney privilege
Article Abstract:
A Second Circuit court has ruled that a law firm must pay a $25,000 fine for failing to submit a completed tax form reporting a cash payment exceeding $10,000. According to Sec 6060I, a person receiving a cash payment greater than $10,000 must submit the name of the paying entity and the amount of payment to the IRS by filling up Form 8300. However, when the firm was paid over $10,000 in cash by a client, it did not include the payor and the amount and invoked the attorney-client privilege in justifying its action. In response, the IRS fined the firm for $25,000, accordance with Sec 6721(e), which imposes a penalty on those who intentionally disregard the filing requirements of Sec 6050I. The firm cited good faith belief in the legality of its action as proof against intentional disregard. Aside from the client-attorney privilege, it also used the 'legal advice' and the 'direct linkage' exceptions to defend itself, all of which were rejected by the court.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1997
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District counsel opinions are subject to Freedom of Information Act disclosure
Article Abstract:
A magistrate judge in Florida ruled that the opinions of the district counsel are subject to public disclosure under the Freedom of Information Act, upholding the public's right to obtain information from the IRS. The case stemmed from the IRS's refusal to release documents to taxpayers related to the technical assistance provided by the district counsel. The agency claimed that the documents were undiscoverable as mandated in three of the Freedom of Information Act exemptions. The magistrate rejected the IRS's arguments, saying that the district counsel's opinions are not return information for purposes of the statute. The court, however, recommended the deletion of some information from the documents prior to their disclosure to the taxpayers.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1998
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A Vision for a new IRS: The commission on restructuring the IRS report
Article Abstract:
The National Commission on Restructuring the Internal Revenue Service recommended changes to enable the IRS to be more user-friendly and boost its control and responsibility. However, President Bill Clinton's order to create the IRS Management Board comprised of administration officials initiates the dispute of who should govern the agency.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1997
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