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Audit Representation and Defense

Taxpayers under audit might ask these and similar questions:

  • I’m dealing with an aggressive revenue agent. What are my procedural rights?

  • The revenue agent demanded a site visit of my business at the beginning of the audit before asking for any business records. Must I consent to the site visit and let the revenue agent have open access to my business facility?

  • I received an overbroad summons requesting all of my business’ electronic books and records for the last ten years. Must I provide all my data to the IRS?

  • Do I need to be concerned that the revenue agent assigned to my case is part of the IRS’ Special Enforcement Program  within the SB/SE Examination Division?

  • What is the jurisdiction of the IRS to ask me whether my business is a money services business under the Bank Secrecy Act?

  • The IRS just contacted me about an audit, and my business has some proverbial “skeletons in the closet.” How should I respond to the audit?

Experienced tax defense counsel can answer these questions for you and guide you through the examination process, reducing risk and potential exposure to civil penalties and even criminal tax charges. The IRS Office of Fraud Enforcement  actively encourages auditors to develop facts to support asserting the civil fraud penalty and to refer cases for criminal investigation. No one wants to be accused of fraud or face a criminal tax investigation. With increasingly aggressive IRS auditors and an IRS growing in strength, you need a defense attorney—not an accountant—to handle your audit.

Dan defends taxpayers who are under IRS audit (also known as “civil examination”). Dan’s extensive tax litigation experience adds value to taxpayers under IRS audit. He understands the administrative audit process, and if he cannot resolve a case with an IRS auditor or revenue agent, he strategically appeals proposed adjustments and seeks to negotiate a settlement with the IRS Independent Office of Appeals. Dan’s ability to persuasively write and effectively present evidence and arguments allows him to advocate for taxpayers during audit, before the Independent Office of Appeals, and in Tax Court.

Domestic Tax Issues

  • Substantiation of business expenses

  • Unreported income

  • Employee Retention Credit

  • Energy Credits under I.R.C. § 179D

  • Employee Retention Credits

  • Section 1031 exchanges

  • Taxation of financial instruments, fintech, and crypto currencies

  • Civil penalties including the fraud penalty under I.R.C. § 6663

  • Partnership taxation

  • Net operating losses from real estate businesses and § 469 passive activity limits

  • Employment taxes and worker classification

  • Excise taxes (aviation, insurance, private foundation, etc.)

  • Microcaptive insurance

International Tax Issues

  • Expatriation and I.R.C. § 877A mark-to-market exit tax

  • Puerto Rico Act 22 residency and sourcing of income

  • Foreign tax credits

  • Section 965 Transition Tax

  • LB&I Campaign issues

  • Foreign gift and inheritance penalties under I.R.C. § 6039F

  • Foreign trust analysis

  • International information reporting for these forms: 

    • Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation

    • Form 3520-A, Annual Information Return of Foreign Trust with a U.S. owner

    • Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts

    • Form 5471, Information Return of U.S. Persons with Respect to Certain Foreign Corporations

    • Form 5472, Information Return of a 25%  Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in U.S. Trade or Business

    • Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund

    • Form 8854, Initial Expatriation Statement

    • Form 8858, Information Return of U.S. Persons with Respect to Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs)

    • Form 8865, Return of U.S. Persons with Respect to Certain Foreign Partnerships

    • Form 8938, Statement of Specified Foreign Financial Assets

    • FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR)


Bank Secrecy Act (Title 31) Issues

  • Form 8300 cash transaction reporting

  • Title 31 Bank Secrecy Act or BSA audits of money service businesses including money transmitters

  • FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR)

Non-Profit and Church Issues

  • Nonprofit entity § 501 and private foundation examinations including excise taxes for self-dealing

  • Church tax inquiries under I.R.C. § 7611

  • Religious orders and IRS Rev. Proc. 91-20

  • The interaction between the First Amendment’s Free Exercise Clause/Religious Freedom Restoration Act (RFRA) and taxation

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