The Internal Revenue Service (IRS) has announced that it is targeting high-income taxpayers who claim exemptions from federal income tax liability under Puerto Rico Act 60. Not only is the IRS targeting taxpayers for civil enforcement, but it is also pursuing criminal tax evasion charges in some cases.

The Employee Retention Credit (ERC) was one of multiple federal programs that served as a financial lifeline to many businesses during the COVID-19 pandemic. By providing refundable credits to eligible businesses, the ERC helped many businesses stay afloat while also continuing to support their employees.

The Internal Revenue Service (IRS) is cracking down on taxpayers who use Maltese pension plans to avoid federal income tax liability. Signed in 2011, the U.S.-Malta Tax Treaty opened a loophole that allowed (or at least arguably allowed) taxpayers to contribute appreciated assets to Maltese personal retirement plans and then take staggered tax-free distributions.

Submitting fraudulent loan documents to a federally insured bank is a federal crime. This is true regardless of whether the submission results in the issuance of a loan. The federal bank fraud statute (18 U.S.C. Section 1344) is extremely broad, allowing for prosecution of any one who “knowingly executes, or attempts to execute, a scheme or artifice . . . to defraud a financial institution.”

With the U.S. Small Business Administration’s Office of Inspector General finding that at least 17 percent of all Paycheck Protection Program (PPP) loans were fraudulent and the New York Times calling the Employee Retention Credit a “magnet for fraud,” IRS Criminal Investigation (IRS CI) is aggressively targeting fraud under both of these COVID-19 relief programs. While these programs are no longer available (although businesses can retroactively claim the ERC until 2025), IRS CI is looking back at individuals’ and businesses’ PPP and ERC applications—and pursuing criminal fraud charges when warranted.