The IRS has created internally a series of “industry groups” that focus on tax issues and enforcement problems specific to certain industries. The Commissioner of the Internal Revenue Service recently announced the formation of a new industry group: the “Global High Wealth Industry Group.” The new group will focus on the country’s wealthiest individuals and their business entities. It has been instructed to take a unified look at the entire web of business entities controlled by high-wealth individuals. The objective of such in depth analysis is to determine the risks presented to tax compliance and the integrity of the tax system.
How rich do you have to be to fall within the ambit of this new group? The Commissioner only said that they are initially looking for individuals with “tens of millions of dollars of assets or income,” with more focus on assets. This will require some research as there is currently nothing on the Form 1040 which requires an individual to disclose the amount of his or her net worth. Could the “IRS 400” replace the “Forbes 400” as the list to be on? We wonder whether people will start bragging to their friends that they are being audited by the IRS Global High Wealth Industry Group. We hope not.