Compliance October 28, 2005

IRS Opens Abusive Tax Scheme Settlement Process

October 28, 2005 (PLANSPONSOR.com) - In an effort to get taxpayers to voluntarily confess their involvement in abusive tax schemes, the Internal Revenue Service (IRS) has unveiled a new "quick, quiet, and cost-effective" settlement process.
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IRS Commissioner Mark Everson said that illegal schemes qualified for the resolution plan include those that have been offered over the past five years in the cafeteria plan and parking benefit arena that have been termed “double-dipping.”

Relief from penalties is available if voluntarily disclosed by the appropriate taxpayers.  The deadline to submit settlement papers is January 23, 2006. In making the announcement, Everson blamed the abusive transactions in part on “lawyers and accountants peddling flaky tax products” that were marketed to small businesses, large corporations, and wealthy individuals.

Many of the abuses cited were tax shelters for individuals, S-Corporations and ESOPS, officials said.

An IRS fact sheet is  here . Additional information is  here .

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