Recent tax regulations to be re-examined

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President Trump signed an Executive Order directing the Treasury to review tax regs adopted during the past 18 months under former President Obama. According to Treasury Secretary Steven Mnuchin, the re-examination of these regs is to ensure that they “do not unduly strain the American economy.” Regs that are determined to be “harmful rules that impose unnecessary costs and complexity on taxpayers” are to be revised or repealed. Mnuchin said the corporate inversion regs will be “one of the things we would be looking at.”

Court grants anonymity to whistleblower, but it might not last

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The U.S. Tax Court granted a whistleblower’s motion to proceed anonymously in his whistleblower case. The basis: The social interests of protecting his identity as a confidential informant exceeded those of the people’s right to know. But the Court said that, as the whistleblower action proceeds, the balance of social interests may change and his anonymity could be lost. The IRS Whistleblower Office pays awards to people who provide “specific and credible information” on tax cheaters. (148 TC No. 7)

No leg to stand on

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U.S. citizens must generally file a Report of Foreign Bank and Financial Accounts (FBAR) if they have an account in a foreign country and meet certain requirements. Failure to file an FBAR can result in penalties as high as the greater of $100,000 or 50% of the unreported balance if the failure was willful. When one taxpayer was hit with an FBAR penalty of $1.36 million, he demanded the IRS provide “clear and convincing evidence” that the failure was willful. The Fifth Circuit ruled he lacked standing to enforce his demand. (3/13/16, 2017-532)

Fast Track Settlement program established for small business and self-employed taxpayers

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In a Revenue Procedure, the IRS has formally created the Small Business/Self Employed (SB/SE) Fast Track Settlement program to provide an expedited format for resolving disputes with SB/SE taxpayers. It can be used to resolve both factual and legal issues, and may be initiated at any time after an issue is fully developed. One of the goals of the program is that the entire process be completed within 60 days after acceptance into the program. (Rev. Proc. 2017-25)