Partner Bryan Skarlatos recently co-authored an article for the Journal of Tax Practice and Procedure with George Hani of Miller & Chevalier and Matt Cooper of Deloitte, titled “IRS’s Enhanced Enforcement Efforts For Partnerships and High-Net-Worth Individuals”.
The article provides an outline of the key efforts the IRS began prioritizing in 2023, including the creation of a new special work unit for large and complex pass-through entities (namely partnerships and S corporations). This new work unit was designed to enhance enforcement with respect to complex and high-dollar cases.
Typically, pass-through entities are examined through the Large Business & International (LB&I) division or Small Business & Self-Employed (SB/SE) division based solely on size. This new unit that focuses on partnership audits and compliance is part of a larger effort to increase enforcement actions on partnerships and high-net-worth individuals.
The article delves further into these enforcement actions, such as the new partnership unit’s focus on basis shifts, since basis can dramatically affect partnership taxation. The IRS also created a new, specialized work unit for high-income and high-wealth taxpayers, the Global High Wealth (GHW) program. GHW examiners are currently focusing on hot-button issues such as art donations, digital assets, and the usage of private aircraft, as careless mistakes with these transactions can quickly transform into criminal tax matters or suspicion of white collar crimes.
About Bryan Skarlatos
For nearly forty years, Bryan has represented corporations and individuals in sensitive matters, many of which involve negotiation or litigation with government agencies. He is internationally recognized for his work on tax controversies, audits, appeals and litigation, criminal tax investigations, and white-collar criminal prosecutions, and he maintains an active practice providing tax and estate planning advice. He provides expert testimony on tax penalties to governmental bodies and teaches courses on tax penalties at New York University School of Law, where he also created and co-chairs the NYU Tax Controversy Forum.
