Michael Sardar participated in a discussion of offshore compliance and enforcement, as part of a larger panel on subcommittee reports on important developments. 

Offshore Compliance and Enforcement Panelists: Arielle Borsos, Caplin & Drysdale, Chtd, Washington, DC, Victor Jaramillo, Caplin & Drysdale, Chtd, Washington, DC, Michael Sardar, Kostelanetz & Fink LLP, New York, New York.

NEW YORK CITY, NY (September 12, 2019) – Kostelanetz & Fink is pleased to announce that nine attorneys at the firm, including seven partners, have been selected for inclusion in the 2019 New York Metro “Super Lawyers” list, recognizing the firm’s experience and skill in the areas of Tax, Criminal Defense: White Collar, and Business Litigation.

In the event of a loss of client records or due to poor record keeping, a paid preparer may need to help his client reconstruct the records and/or make estimates. This session covered tips and ideas on how to handle such issues from tax-return preparation through audit and will include a review of the Schedule C Form, common Schedule C pitfalls, and the best practices for how the tax return preparer and client can utilize estimates and reconstructions in these situations.  The session also addressed the Cohan rule and the AICPA Statement on Standards with respect to the use of estimates.​

The IRS has offered noncompliant taxpayers a path to come into compliance for decades. First, under the Internal Revenue Manual voluntary disclosure practice, and then under the historic Offshore Voluntary Disclosure Programs. In November 2018, the IRS announced new provisions that will apply to all future domestic and offshore voluntary disclosures. Since then, practitioners have been debating the new voluntary disclosure practice and its impact on clients, and taxpayers are wondering if this is the best approach to resolve outstanding issues. The panelists outlined the new framework and engaged in a spirited discussion regarding various open issues and best practices.

U.S. taxpayers and residents are required under the Internal Revenue Code and the Bank Secrecy Act to report their relationship to foreign accounts and assets on an annual basis. The IRS and the Department of Justice have significantly increased enforcement of these reporting requirements through criminal prosecutions and the imposition of crushing civil penalties that can come when taxpayers are not compliant. This panel explored the current state of IRS and DOJ civil and criminal enforcement with respect to taxpayers who have not complied with FBAR (Report of Foreign Bank and Financial Accounts) and FATCA (Foreign Account Tax Compliance Act) reporting requirements. The panel also covered pathways to compliance for the non-compliant taxpayer, including the IRS’s Voluntary Disclosure Practice.

New rules from the First Step Act and sentencing guidelines amendments could be on display when judges start deciding on punishment for participants in the recent massive college bribery scheme.

The sentencing hearings will begin in June for those facing charges, including tax and fraud charges, in the “Operation Varsity Blues” college admissions scandal, with the hearings for the parents who have pleaded guilty to start in the fall.

Ever since CI started talking about its new data analytics strategy, the division has been fielding privacy and disclosure concerns.

Asked if the IRS has the right to apply its new sophisticated data analytics tools to a taxpayer’s data, Michael Sardar of Kostelanetz & Fink LLP said that the standard search and seizure analyses involve situations in which the government needs to spend a large amount of resources — for example, with visual surveillance or telephone wiretapping. “There’s a parallel in terms of how much effort the government has to put in versus what they are going to get out of it, and that’s how you determine
what is reasonable,” he said.

A panel of experts updated attendees on the latest priorities and trends in IRS criminal Enforcement, including cyber-crimes, crypto-currency, marijuana, payroll tax crimes, money laundering and good-old-fashioned income tax evasion.

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Moderator: Lisa E. Perkins, Green & Sklarz LLC, West Hartford, CT

Panelists:

• Kristina O’Connell, Special-Agent In-Charge, IRS Criminal Investigation, Boston Field Office
• Frank Agostino, Esq., Agostino & Associates, Hackensack, NJ
• Michael Sardar, Esq., Kostelanetz & Fink, LLP, Washington, DC

Important developments in Offshore Compliance and Enforcement.