Tax Strategies

The Justice Department has asked a federal court to bar a flea market-based tax preparer from readying returns for clients.According to a complaint filed in Miami’s U.S. District Court, Tashanna McFarland of Miramar, Fla., regularly prepared federal tax returns claiming fraudulent fuel tax credits, a scam that the Internal Revenue Service has said is a serious enforcement problem. McFarland operates her tax preparation business out of a booth in a Miami flea market.

The Wisconsin Department of Revenue has inadvertently distributed 170,000 tax forms bearing the Social Security number of the intended recipient on the mailing label.

With the Tax Relief and Health Care Act of 2006 now signed into law, the Internal Revenue Service has rolled out guidance to help taxpayers filing in 2007 claim the extended deductions and other tax advantages contained in the act.

Just before the holiday break, a federal appeals court said it will reconsider a case involving the taxability of damages received for emotional distress.

For a government agency with such a bad rap in popular culture, the Internal Revenue Service performed well in a recent survey asking taxpayers to comment on customer service levels.

The thoroughness of Internal Revenue Service enforcement efforts for the nation’s largest corporations, measured by the number of hours devoted to each audit, has substantially declined since Fiscal 2002, according to data obtained by the Transactional Records Access Clearinghouse.

A Utah businessman has become the third person to enter a guilty plea in the criminal probe over tax shelters promoted by 16 former executives of Big Four firm KPMG.

The Internal Revenue Service is lifting a moratorium on determination letter applications for conversions from traditional defined benefit pension plans to so-called cash balance plans.

The long-awaited trial of 16 former executives at Big Four firm KPMG on charges of conspiracy and tax evasion will begin in September.

As expected, President Bush signed a massive bill that would extend expiring tax, health and trade legislation.