Stein - The Court got it right! The Government and the Wall Street Journal Editorial just don't get it.

Judge Kaplan dismissed the indictment against 13 of the former KPMG employees who were charged in the largest criminal tax case in the history of the United States. The Court correctly found that the government violated their constitutional rights when it coerced KPMG to stop paying their legal fees. See United States of America v. Stein, -- F.Supp. 2d – (SD. N.Y. 2007).

The Government filed its appeal claiming there was no constitutional violation. This past Thursday, the editorial page the Wall Street Journal blasted the government for attempting to proceed with the case. The Government and the Wall Street Journal just don’t get it.
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Shelter + Facilitator + Rico = $6 Million Award

The IRS has rather explicitly been telling taxpayers caught in the middle of the tax shelter wars to go sue the parties that got them in the transaction. In Ducote Jax Holdings LLC et al. v. William E. Bradley, - F. Sup2d – ( E.D. La. 2007), those taxpayers that have heeded the advice of the IRS must have jumped for the heavens as the Court applied the RICO statute to what appears to be a Son-of- Boss transaction.

Let’s just say a certain Chief Counsel must have smiled when he read that decision. Question for the IRS will it seek to tax the proceeds or will they allow these taxpayers to pursue these ‘advisors” —Hell has no fury like that of a jilted “taxpayer”.
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IRS's policy updates on FIN 48: The eye of the beholder; Stein - Is the United States facing the inevitable?

Recently, the IRS positions – LMSB-04-0507-044; LMSB-04-0507-045; and CC-2007-015 - have been made public. See 2007 TNT 125-9, 2007 TNT 125-10 and 2007 TNT-12.

The IRS says it will continue to maintain a policy of restraint on FIN 48 workpapers, as it has with tax accrual workpapers Yet in the same breath, the IRS is training its agents on “FIN 48 information and disclosures” and has created a tax accrual workpaper (TAW) cadre to assist with the review of documents received in response to TAW’s IDR’s.

So the question is what is the IRS up to as to FIN 48? The answer lies in the details of its interpretation of FIN 48.
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