Category: IRS

Tiger Woods Mistress: Candidate for IRS Audit?

Maybe! Our imagination tends to run wild so if you’ve got reason to believe that hush money paid to Tiger’s mistresses is of no interest to the IRS, please advise.

TMZ is reporting, based on “sources — and they are good” that Tigger paid Rachel Uchitel $10 million to keep her mouth shut regarding their affair.


Or maybe we’re not giving either of them enough credit. Maybe Rachel has a tremendous business acumen that we’re not aware of and she requested a 1099 from T. Dubs.

Plus, Tiger employs more people than Alaska, so someone on his team may have been looking out for this girl. TW, on the other hand, there’s NFW he considered the problems this could possibly create. Considering the fact that he has trouble communicating, we’re guessing the financial ramifications for his F-buddies slipped his mind.

10 Million Reasons Tiger Was Afraid of Rachel [TMZ]

It Literally Took an Act of God* for the IRS to Do Something Nice

There’s a slew of “reasons” that people have for hating on the Internal Revenue Service. They’re responsible for discourse on television, they don’t observe Shabbos, perverts (alleged!), etc.But every now and again the IRS gives you a reason to say, “well, that’s nice of them,” even if it takes rainfall that makes you consider cobbling an ark together and rounding up the animals in the neighborhood.


The Service is not unreasonable. Apologetic? Never. But not unreasonable. Accordingly, if you live in eastern Massachusetts or Rhode Island the IRS took notice of the rising waters and is extending the April 15th deadline to May 11th (?).

It’s unlikely that this will garner much favor with the IRS haters outside of the Northeast but at least the Service won’t have to ignore the flood of calls from Bay State and Ocean State residents about whether they’ll still be expected file on time. Grab a bucket.

IRS will delay April 15 deadline for many in Mass. [Boston Globe]
Flood weary Rhode Islanders get tax extension [AP via Globe]

*For the militant atheists – Calm down, wouldja? It’s a religious week. Just sub “Nature” and move on.

Apparently the Porn Problem Has Spread from the SEC to the IRS

This is the last thing the IRS needs. Well, maybe next-to-last.


“An IRS employee is charged with having child pornography on a laptop computer that police said he left in a garbage bag in a wooded area in Sterling Heights. Alan E. Erickson, 45, of Sterling Heights is charged with one count of using a computer to commit a crime and five counts of possession of child sexually abusive material, officials said.”

Dumping a laptop in the woods? And child porn to boot? Jesus. You thought the death threats against IRS agents were bad before…

IRS employee charged in porn case [Detroit Free Press]

Image source: Sterling Heights Police via DFP

Doug Shulman Takes It as a Compliment That the IRS Is the ‘Go-to’ Government Agency

If you’re a member of the AICPA the biggest benefit you enjoy is not the prestige, not the certificate that you have mounted on your wall but the Journal of Accountancy that shows up in your mail every month. It’s really solid that your firm shells out good money on an annual basis so you can add new Excel tips to your spreadsheet wizard repertoire.

JofA manages to talk to a number of high profile as well, which you would expect from a behemoth professional journal. Case in point, when we received the latest month’s issue we couldn’t help but get a little giddy seeing Doug “Help me, help you” Shulman. We flipped to the Q&A immediately after seeing his handsome mug on the cover only to find the Commish’s picture at right. It makes us think that he’s channeling Monty Burns, which some of you probably find appropriate.


The Q&A is pretty much what you would expect, touching on the new preparer regulations, “We ran a very open, transparent, public dialogue about this,” to threatening offshore tax scofflaws, “The U.S. government is getting very serious about rooting out offshore tax evasion,” and warning whistleblowers not to expect that money any time soon, “[T]his could take multiple years to get the awards out. But I’m a big fan of the program.”

A couple of more interesting statements, include how excited Dougie is that all the assignments that other government agencies don’t want, get dumped on the service, “it’s…a big compliment that we’re seen as a ‘go-to’ agency in government.”

That being said, this particular interview was certainly conducted prior to the passage of the healthcare reform bill and no mention of the IRS’ role in enforcement (or lack thereof) was brought up. Maybe if the JofA had seen the Bill O’Reilly/Anthony Weiner throwndown it would have been a stop the presses moment.

The only other thing worth noting is that pizza parlors around the country might want to tighten up the ship in the coming months, “We will build features into our technology system so if we see, say, a pizza parlor that says they had $90,000 of sales last year and it shows that they had $85,000 of credit card sales and we know that pizzerias have a lot of cash sales, that will be a red flag. We’ll use it to better target our audits, to see where there’s potential noncompliance, and then we’ll use it to better focus our resources.”

Maybe the Commish is just giving an example of what a red flag is but using this particular example rather than say, a celebrity, seem peculiar. Just leave Di Fara alone, okay?

Tax From the Top: Q&A With IRS Commissioner Doug Shulman [Journal of Accountancy]

Bill O’Reilly and Anthony Weiner Attempt to Have a Discussion About the IRS’ Role in Healthcare Enforcement

The whole thing is worth watching but 4:17 is where it starts getting awesome.


Did you count? Congressman Weiner was rendered silent for approximately 13 seconds!

Other highlights:

Weiner: I’ll say that again – that are just lies.

Weiner: I’m answering the question, you’re making stuff up.

O’Reilly: Ask Wesley Snipes

Weiner gives the loudest SIGH we’ve ever heard around 4:30

Weiner: Watch this Bill, watch this.

O’Reilly: I asked you five times.

Best look given by each:

The IRS Isn’t Resting on the Sabbath

If you refuse to use the White House’s tax savings tool purely out of spite then you’ll be happy to know that 180 IRS locations across this great land will be open this Saturday to help you out with things like the Homebuyer tax credit, the American Opportunity Credit, the Making Work Pay credit, and the Expanded Earned Income Credit.

Now we realize that the mere thought of setting foot inside an IRS location will cause many you to break out in boils, the other option is to go to a VITA location and get assistance from one of the many college students out there that are giving amateur advice so that they have one more activity on their resumé. They’re available throughout tax season. They are volunteers, after all.


The Service is trying to make this sound way more fun than it actually is by calling them “open houses”:

“We are holding these special open houses to give taxpayers who are struggling in these difficult economic times more opportunity to work directly with IRS employees to resolve their tax issues,” said IRS Commissioner Doug Shulman. “We will host more than 180 open houses this Saturday.”

Whether Dougie will be on hand at one of the many locations to shed out his wisdom (or maybe get some advice) hasn’t been made clear.

More than 180 Local IRS Offices Open this Saturday to Help Taxpayers [IRS.gov]

The IRS Will Enforce Mandatory Healthcare Using the Honor System

How much tax would you pay on April 15 if the IRS couldn’t levy on your bank account, slap you with a lien, charge you penalties and interest, or send you to jail? Not much, eh? Then ponder the rules forcing individuals to buy “minimum essential coverage” under Obamacare.

The forced purchase of insurance is key to Obamacare. The “personal responsibility requirement” – a funny name for a requirement imposed by the state – is needed to make sure that low-risk individuals buy insurance to help keep it affordable for high-risk buyers (or, less politely, healthy young men are forced to subsidize everybody else). The penalty is considered vital to any semblance of fiscal soundness for the program. The rule is backed up by penalties and will be collected on tax returns.


The reaction of healthy young men in 2014 when this penalty kicks in will be “Dude. You’re not serious.”

And they will be right.

Caleb noted this yesterday from the Joint Committee of Taxation explanation of the penalties (my emphasis):

The penalty is assessed through the Code and accounted for as an additional amount of Federal tax owed. However, it is not subject to the enforcement provisions of subtitle F of the Code. The use of liens and seizures otherwise authorized for collection of taxes does not apply to the collection of this penalty. Non-compliance with the personal responsibility requirement to have health coverage is not subject to criminal or civil penalties under the Code and interest does not accrue for failure to pay such assessments in a timely manner.

If we take them at their word – and new Code Sec.5000A(g)(2) seems to say just this – why would any sensible taxpayer ever pay the penalty?

• They can’t threaten you with jail.
• They can’t hit you with a lien.
• They can’t levy your accounts.
• There’s no interest charge, so even if you do pay it late somehow, you’ve had the interest in the meantime.

We tax preparers probably won’t be allowed to recommend non-payments to our clients, or we will be silenced by our new IRS preparer enforcement overlords, but people will figure it out in a hurry. And if you think that people will pay taxes anyway without the threat of collection, penalties or interest, then why are we wasting any money funding the IRS?

This provision means one of two things: either this penalty is a joke, and they are just kidding about the cost estimates of the bill — they will be much, much higher — or the toothless penalties are just a PR stunt that they plan to correct as soon as they can get away with it.

A Tax Lien Is a Much More Manageable Problem Than Say, Apologizing to Your Oscar Winning Wife

Since Jesse James’ tax lien is relatively small — $3,918 — you can probably chalk this up to a mistake. However, since the taxes are related to 2007, could it be that it was an oversight? A mistake? Poor judgment?

Poor judgment akin to say, inviting a tattoo model/stripper/rumored white supremacist into your bike shop to cheat on your wife? Is that sort of the same thing?

Tax debt adds to sex scandal for Sandra Bullock beau [Tax Watchdog]

Ludacris Should Be Giving Ving Rhames Tax Advice

In today’s celebrity tax scofflaw du jour, we learn that Ving “Why do people always have to bring up that scene in Pulp Fiction” Rhames owes the IRS over $800k from two liens, both filed by the IRS in Los Angeles.

Rhames has had trubs in the past, having liens filed against him last May as well.

It seems to that California, being in the fiscal trouble that’s it in, really needs to call on its other celebrity residents to hold some sort of Haiti-esque fundraiser for some of their fellow celebs.


Sure, it might not fix all the state’s budget problems but at least we could admire our celebrities for being financially responsible pillars of the community rather than pillars of the community when there’s an international crisis. Plus, maybe California wouldn’t have to fire more teachers.

In semi-related news, you will never, ever, EVER hear about Ludacris owing the IRS a damn thing. Not now, not ever.

“I pay more in taxes than most people would ever imagine. I guarantee you, I’m looking dead in the camera, you will never hear about Ludacris owing the damn IRS no damn money.”

Okay, financial celebrities f-ups, get on the horn and find out what the great financial mind-cum-rapper/actor of Ludacris has in store for you. Things haven’t worked out so far, so it can’t hurt to see what the man has to say.

Ving Rhames far from OK with Uncle Sam [Tax Watchdog]

You’re Wasting Your Time if You Attempt to Bribe an IRS Agent with Starbucks

As we’ve recently learned, IRS Agents are a zealous bunch. If you’re out of compliance you can bet the life of your labrador that they will run you down for the overdue tax, regardless of the sum.

Now perhaps you’ve been thinking that a little bribery might take care of things if you find yourself in a bit tax trouble. IRS Agents are human(?) after all; they fall ill to the temptations of this world just like the rest of us. And because they most likely have some sort of accounting background, they are most certainly caffeine abusers and thus, Starbucks whores.


But an Agent’s first responsibility is to serve the American Taxpayer and your attempts to tempt these civil servants with sweet, venti-sized, mega-calorie caffeinated beverages WILL NOT WORK:

Kim Oahn Thi Tran, also known as Jennifer Kim Tran, faced a tax liability of more than $13,287 for the 2006 and 2007 tax years on unreported income of $30,334, authorities said.

In hopes of lowering her tax liability, Tran sent a package on Nov. 30 to IRS revenue agent Imad Hararah that contained promissory notes and a $100 gift card for Starbucks Coffee that read, “To Imad: Enjoy,” investigators said.

Agent Hararah did not fall for this ploy. Nor did he accept the $2,000 that Tran attempted to give him. Instead this presented itself as a perfect opportunity to add charges, “On Dec. 9, Tran gave the agent $1,500, authorities said. In exchange, Hararah gave her a phony document that made Tran believe that she had a zero balance for 2006 and 2007 tax years.”

Does this guy love his job or what? Not cold hard cash nor natural stimulant will distract this man from doing his job. We can only assume that his brethren are of the same cloth and soon we’ll hear about Agents turning down dates with Lane Kiffin.

Woman charged with trying to bribe IRS agent [SF Chronicle]

More IRS Resistance, Now with High-Speed Car Chases!

A man in Oklahoma City fled police after IRS agents that had been staking out his house attempted to pull him over after it was clear he wasn’t showing up for his court date. The tax-hater du jour was due for a court date in Texas and when the IRS Agents realized he wasn’t headed for the LSS, they tried to stop him. The suspect then did what any clear-thinking person would do when pursued by IRS agents: ESCAPE.


An OKC policman saw the speeding Lexus, pursued, and one left turn later and a brief foot race later, the tax scofflaw was brought justice. IRS: 1. A guy that has probably appeared shirtless on Cops: 0.

No word on whether the IRS were the zealous type but we’re assuming they were packing heat. And since this particular ne’er do well had a court date, it’s safe to assume that he had a settle up for more than just his pocket change.

Police: Chase Suspect Fleeing IRS [KOCO]

IRS Not Just Going After Loose Change: Audits of Millionaires Rising

So this morning we learned that some IRS Agents decided to get huffy with a taxpayer over a sum that was less than a sketchy gas station party favor.

With this in mind, the more affluent of you may think that the IRS was finally recognizing that the millionaires in this country are the ones that make things happen. If the IRS would just BTFU and let the rich do their thing we’d get this economy back to blowing asset bubbles.

Unfortunately, Doug Shulman has remained steadfast in his commitment to making millionaires’ life hell by virtue of increasing the number of IRS audits on the wealthy.


According to a report in the New York Times, audits of individuals that earn at least $1 million are way up, “The federal agency increased its audits of taxpayers who earned $1 million to $5 million by 33 percent last year compared with 2008.” And if you’re in an even higher class of Joneses, your chances of getting audited are going up too, “[T]he I.R.S. increased its audits by 16 percent for those earning $5 million to $10 million last year. Audits of those who made at least $10 million rose by 8.5 percent, according to the data.”

The Times quotes a tax expert, Richard Boggs of Nationwide Tax Relief who then says the unthinkable (our emphasis):

“The I.R.S. is getting smart,” he said. “They are starting to better leverage their time, resources and talent in order to collect the most money. There is a definite shifting of the tide.” He said audits of those making at least $10 million rose slightly less than for other categories because so many of the ultrawealthy were already being audited.

We’re sure Mr Boggs is a top-notch tax guru but there is strong evidence that suggests that the IRS will still try to collect less substantial sums.

However, we have to admit, the numbers don’t lie. Millionaires out there, your chances of getting audited are going up and that sucks. But what should make everyone really nervous is the Service attempting to collect your loose change. Next time you see a nickel on the ground, we suggest you leave it there.

I.R.S. Says Its Audits of Wealthy Are Rising [NYT]