U.S. Appeals Court Upholds IRS Authority to Collect Full Restitution for Tax Fraud, Rejects Payment Schedule Challenge

The U.S. Court of Appeals for the Seventh Circuit affirmed the Tax Court’s decision holding that the IRS had authority to assess and collect restitution ordered for a tax-related Title 18 offense. Taxpayer, an individual, was convicted of conspiracy to defraud the IRS and other tax-related crimes under Title 18 for designing and promoting fraudulent tax shelters. The district court ordered Taxpayer to pay $371 million in restitution to the U.S. Treasury, with payments of 10 percent of gross monthly income starting 30 days after release from prison. The IRS then assessed the full $371 million restitution amount against the ...