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If Justice Department concurs, it files suit against promoter requesting that court order promoter to refrain from fraudulent activity. Depending on facts and circumstances of case, court may issue a temporary restraining order, a temporary injunction or a permanent injunction.
At present, courts have issued injunctions against 99 abusive scheme promoters –– 81 permanent injunctions and 18 preliminary injunctions. They have issued permanent injunctions against 17 abusive return preparers. The Justice Department has filed an additional 49 suits seeking injunction action –– 28 against scheme promoters and 21 against return preparers.
The IRS is currently investigating more than 1,000 additional promoters for possible referral to Justice Department and conducting individual examinations on thousands of tax scheme participants.
Richard Chapo is CEO of Business Tax Recovery - Obtaining tax refunds for small businesses for overpaid taxes. Discovery tax strategies and deductions in our tax articles section.