The Internal Revenue Service’s Large Business and International (LB&I) division is taking a new approach to tax compliance, with a series of 13 campaigns aimed at cracking down on tax evasion.
The LB&I is moving toward issue-based examinations and a compliance-campaign process in which it decides which compliance issues present enough of a risk that they require a response. The response will come in the form of one or more treatment streams such as examinations and letters to achieve the IRS’s tax compliance objectives, leveraging IRS expertise in various compliance issues. The IRS restructured the division last February, allowing it to better evaluate items of noncompliance to determine where there might be the most risk.
The campaigns spotlight a variety of issues such as tax credits for advanced energy projects, people who withdraw from or are denied entry to the Offshore Voluntary Disclosure program, land developers and completed-contract method, domestic production activities deduction, companies claiming film-production credits, transfer-pricing studies, micro-captive insurance, S-Corporation losses claimed in excess of basis, foreign companies and non-filer of Form 1120-F, and related-party transactions campaign.
The LB&I division has responsibility for businesses with assets in excess of $10 million, along with wealthy individuals who have international tax compliance obligations.
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