Washington (Dec. 12, 2002) -- The Internal Revenue Service has revised and updated a key practice that assists agency investigators in determining whether a case is recommended for criminal prosecution.Specifically, a taxpayer’s timely, voluntary disclosure of a substantial unreported tax liability has long been an important factor in deciding whether the taxpayer’s case should ultimately be referred for criminal prosecution. The practice has been modernized to allow more taxpayers to voluntarily comply with their obligations and to reduce the uncertainty over what constitutes a "timely" disclosure.
"Sound tax administration, including the possible use of criminal prosecution, requires as much clarity as possible," said Bob Wenzel, Acting IRS Commissioner. "We want taxpayers, as well as their tax advisers, to better understand the steps they can take and the circumstances in which they can get back into compliance with the tax laws."
As before, the practice requires the taxpayer to make good faith arrangements with the IRS to pay in full the tax, interest, and any applicable penalties as determined by the IRS. This disclosure practice does not apply to those with income from illegal sources. The revised practice creates no substantive or procedural rights, and will not automatically guarantee immunity from prosecution.
-- Electronic Accountant Newswire staff
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