E&Y tax advice to wealthy Americans questioned

E&Y tax advice to wealthy Americans questioned

Reports coming out of the US tell us that Ernst & Young has been selling wealthy US citizens four legal techniques for reducing their income tax bill, one of which experts claim could be illegal.

The firm insists the techniques are ‘legal and proper’ but some US experts have alleged one of them is illegal because it could hide transactions from the Internal Revenue Service, amounting to tax evasion, according to the New York Times.

Experts claim the four techniques cut the tax bill from 38.6% to just 18% for which the firm is paid a hefty sum for its advice – 6% to 8% of the tax bill plus $50,000 for a lawyer’s letter of opinion.

All the firms’ techniques have been made public – a financial advisor who was briefed by E&Y made them known to the New York Times.

In defending the techniques, Ernst & Young said at least one of them has been disclosed to the IRS and the government office has not challenged it.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource