Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
IRS Increases Scrutiny of Small Businesses
Author: Scarinci Hollenbeck, LLC
Date: October 15, 2013
Key Contacts
Back
The Internal Revenue Service has initiated a large campaign to crack down on offshore tax evasion and other egregious tax law violations that could result in large recoveries of hidden tax income, penalties, and interest. However, the IRS is also increasing its focus on small business tax practices, even if the potential for recovering sizable payments is small, a new analysis reveals.
IRS and Justice Department representatives recently spoke at the American Bar Association Sections of Taxation and Real Property Fall CLE Meeting, during which time they affirmed that federal tax agencies are taking on a higher share of smaller criminal employment tax cases, Bloomberg Law reports. Employment violations by small businesses range from failure to make Medicare and Social Security payments to misclassifying employees as independent contractors. Panelists theorized that larger corporations have sufficient resources and legal support to ensure maximum compliance with employment tax laws. However, they noted that smaller companies with fewer financial, tax and legal support may be more likely to commit employment missteps.
“Often you will see an employer who has a course of conduct over quite a long period of time,” Margaret Leigh Kessler, assistant chief of the Western Criminal Enforcement Section, Tax Division at the Department of Justice, told Bloomberg. “They are taking aggressive action to actively hide assets once the IRS has determined they are not complying with their employment tax obligations [and] they’re lying to the IRS, who is looking into their employment tax.”
According to a separate report in Businessweek, the IRS recommended roughly 3,700 prosecutions for various employment law violations for the year ending September 2012. The analysis also suggests that certain sectors are more likely to be audited than others – such as construction contractors and real estate rental agents – which are more likely to attract federal tax agencies’ attention.
- Practices: Tax and Trusts & Estates, Corporate Transactions & Business
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
The Role of Corporate Restructuring in Mergers & Acquisitions
Contrary to what many people think, corporate restructuring isn’t all doom and gloom. Revamping a company’s organizational structure, corporate hierarchy, or operations procedures can help keep your business competitive. This is particularly true during challenging times. Corporate restructuring plays a critical role in modern business strategy. It helps companies adapt quickly to market changes. Following […]
Author: Dan Brecher
Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public
Cryptocurrency intimidates most people. The reason is straightforward. People fear what they do not understand. When confusion sets in, the common reaction is either to ignore the subject entirely or to mistrust it. For years, that is exactly how most of the public and even many in law enforcement treated cryptocurrency. However, such apprehension changed […]
Author: Bryce S. Robins
Understanding Chattel Paper: A Key Component in Secured Transactions
Using chattel paper to obtain a security interest in personal property is a powerful tool. It can ensure lenders have a legal claim on collateral ranging from inventory to intellectual property. To reduce risk and protect your legal rights, businesses and lenders should understand the legal framework. This framework governs the creation, sale, and enforcement […]
Author: Dan Brecher
Crypto Compliance: A Comprehensive Guide
For years, digital assets operated in a legal gray area, a frontier where innovation outpaced the reach of regulators and law enforcement. In this early “Wild West” phase of finance, crypto startups thrived under minimal oversight. That era, however, is coming to an end. The importance of crypto compliance has become paramount as cryptocurrency has […]
Author: Bryce S. Robins
Supreme Court and Title VII: Implications for Reverse Discrimination
Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]
Author: Matthew F. Mimnaugh
SPACs Are Back, What You Need to Know
Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.