Internal Revenue Service: Efforts to Identify and Combat Abusive Tax Schemes Have Increased, but Challenges Remain

United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 2002-05-22 monographic deposited born digital GA 1.13:GAO-02-733 https://www.govinfo.gov/app/details/GAOREPORTS-GAO-02-733 P0b002ee1803a4193 f:d02733 DGPO 2010-08-12 2011-03-23 GAOREPORTS-GAO-02-733 machine generated eng fdlp REPORT GAOREPORTS-GAO-02-733 GAO-02-733 Crimes or offenses Fraud Income taxes Interagency relations Program abuses Strategic planning Tax administration Tax evasion Tax exempt status Tax violations Taxpayers IRS Abusive Tax Schemes Program IRS Frivolous Return Program IRS National Fraud Program IRS Anti-Money Laundering Program IRS Questionable Refund Program Other Written Product A03395 Internal Revenue Service: Efforts to Identify and Combat Abusive Tax Schemes Have Increased, but Challenges Remain The Internal Revenue Service (IRS) characterizes an abusive tax scheme as any plan or arrangement created and used to obtain tax benefits not allowable by law. According to IRS, abusive tax schemes fall into four categories: frivolous returns, frivolous refunds, abusive domestic trusts, and offshore schemes. IRS estimates the potential revenue loss from abusive tax schemes to be in the tens of billions of dollars annually. Developing accurate estimates is difficult because of the limited numbers of cases examined and investigated. IRS identifies and examines abusive tax scheme promoters and participants through its Small Business and Self-Employed Division and Criminal Investigation. In fiscal year 2000, IRS created a program that focuses on false and frivolous schemes. IRS has also created new offices that focus exclusively on abusive tax schemes that use legal structures like domestic and offshore trusts and partnerships. IRS coordinates with federal agencies to identify, monitor, and prosecute promoters and participants in abusive tax schemes. These activities range from sharing information and detection techniques with agencies such as the Securities and Exchange Commission and the Federal Trade Commission to assisting in the prosecution of fraud related cases with the Department of Justice. IRS participates in work groups that share information, skills, and procedures. These work groups discuss procedures for combating fraud on the Internet and the use of civil injunctions against promoters of abusive tax schemes. https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-02-733/html/GAOREPORTS-GAO-02-733.htm GAO-02-733 https://www.govinfo.gov/app/details/GAOREPORTS-GAO-02-733 Other Written Product GAO-02-733; Internal Revenue Service: Efforts to Identify and Combat Abusive Tax Schemes Have Increased, but Challenges Remain; Crimes or offenses Fraud Income taxes Interagency relations Program abuses Strategic planning Tax administration Tax evasion Tax exempt status Tax violations Taxpayers IRS Abusive Tax Schemes Program IRS Frivolous Return Program IRS National Fraud Program IRS Anti-Money Laundering Program IRS Questionable Refund Program