Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comKey Contacts
Back
The Internal Revenue Service was not wholly unaffected by budget cuts and the federal sequester, and saw many of its financial resources diminished as a result. In response, the IRS may lean on technology solutions to detect tax law violations and penalize criminals. However, the agency’s use of new data mining innovations has raised a number of privacy concerns and inquiries among consumers, legal professionals and tax preparers.
According to U.S. News and World Report, the IRS is relying more heavily on robo-audits and data mining to match returns and detect potential cases of tax evasion, fraud and inconsistencies. While the technology has been used in the past to catch low- to middle-income Americans who commit tax violations, the agency is expected to make technological advancements that allow it to focus on small businesses owners. For example, the technology now allows the IRS to track credit card transactions and gather other information from online transactions and social media postings.
At the heart of the issue is which types of third-party data the IRS will use and how this information will be assessed when trying to detect and prosecute tax evaders, the news source reports. Currently, the agency has only said that the systems allow it to gather data on every single taxpayer, including shopping records, travel, social communications and non-public information, such as health records, according to U.S. News and World Report.
“This capability is designed to feed into a single, consolidated taxpayer-account database that will support the deployment of the next generation of taxpayer service and enforcement functions,” said U.S. Treasury Inspector General for Tax Administration J. Russell George, the news source reports.
While many tax law attorneys and preparers have requested more guidance on this topic from the IRS, the agency noted that these disclosures may hinder its detection efforts.
- Practices: Tax and Trusts & Estates
- 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
Are Stay Interviews the Key to Retaining Top Talent?
Retaining top talent continues to be one of the greatest challenges facing employers today. Even in an employer’s market, the loss of a key employee can disrupt operations and result in significant costs. While compensation plays a role, long-term retention often depends on workplace culture, communication, and employee engagement. One increasingly popular strategy for improving […]
Author: Angela A. Turiano
Why Secured Transactions Are Important
Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]
Author: Dan Brecher
Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications
Cashing a check marked “paid in full” can be a risky endeavor, particularly if you don’t fully understanding the legal implications. If you are owed more than the amount of the check you accept and deposit, you may waive your right to collect the full disputed amount. That is why you should consider either rejecting […]
Author: Dan Brecher
Changes to Qualified Small Business Stock Will Benefit Startup Founders and Investors
The One Big Beautiful Bill Act of 2025 (OBBBA) significantly impacts federal taxes, credits, and deductions. A key change relating to Qualified Small Business Stock (QSBS) allows greater tax-free gains for investments in startups and other qualifying small businesses. Company founders and other investors should understand how the enhanced tax strategy works or risk missing […]
Author: Dan Brecher
Corporate Consolidation and Antitrust Issues in Mergers
Corporate consolidation involves two or more businesses merging to become a single larger entity. The result is often a stronger and more competitive company that can better navigate today’s competitive marketplace. What Is Corporate Consolidation? Corporate consolidation closely resembles a basic merger transaction. The primary difference is that a consolidation creates an entirely new business […]
Author: Dan Brecher
What is Business Law and Why Is it Important?
Business law plays a critical role in nearly every aspect of running a successful enterprise, from negotiating a commercial lease to drafting employee policies to fulfilling corporate disclosure obligations. Understanding what is business law and your legal obligations can help your business run smoothly and build productive relationships with clients, business partners, regulators, and others. […]
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.