With international tax compliance on the IRS’s radar, it was revealed publicly to reporters on August 2, 2017, that the IRS Criminal Investigation Division (IRS-CI) is assembling a new, dedicated international tax enforcement unit. The new initiative is expected to be fully operational by October 1. U.S. persons’ worldwide income and foreign financial assets are targeted.
According to the new IRS-CI Chief Don Fort, “we’re going to be standing up a group of elite special agents in our Washington, D.C., field office that are going to be dedicated to working and developing significant international tax cases. What we’re essentially doing is consolidating some of our foremost experts in these international tax cases who are really the nationwide experts in this field and put them under the umbrella of one focused operational group.” Before serving as chief, Fort was IRS-CI deputy chief and has spent the past 26 years of his career as an IRS criminal investigation agent.
Besides the base in the Washington, D.C., field office, members of the team will be strategically located throughout the country. The Department of Justice’s Tax Division will also be supporting the IRS in this endeavor.
The unit will involve a very heavy data analytics component in order to identify noncompliant taxpayers. Fort clarified that “the goal of the unit is to really use all of the data that we have available to us to help identify and develop areas of noncompliance.”
Specifically, the unit will utilize the mass of data recently collected by the IRS from sources such as Foreign Bank Account Reports (FBARs), foreign financial institutions’ data gathered as required under the Foreign Account Tax Compliance Act (FATCA), the Panama Papers, and amnesty programs like the Offshore Voluntary Disclosure Program (OVDP).