I’ve been covering tax and financial crimes for some time now and it’s rare that those convicted of white collar crimes net significant jail time. That’s why I was surprised to see a judge hand down a 65 year prison sentence to a 69-year-old who was found guilty of fraud and tax evasion.
Judge Maryellen Noreika handed down the lengthy sentence to Robert Leroy Higgins, citing the “scope and brazenness” of Higgins’ crimes in what prosecutors called “the largest theft from a precious metals depository in the history of the United States.”
Tax-favored Delaware has long attracted metals traders and investors. That was part of the appeal when Higgins established his first company to store gold and silver bars and coins belonging to taxpayers who wanted to include precious metals in their retirement accounts.
Traditional individual retirement accounts (IRAs) allow taxpayers to hold stocks, mutual funds, and other investments. But under existing IRA rules, gold and other precious metals are considered “collectibles” and aren’t generally allowed in IRAs. There’s an exception in the statute for highly refined bullion that is in the physical possession of a bank or an IRS-approved non-bank trustee—personal storage of the gold, such as at home or in a safe, is prohibited.
(If you’re a regular reader, you’ll recall that I tackled this topic in a recent issue of the newsletter.)
Thousands of customers took advantage of his services–and, prosecutors allege, Higgins took advantage of them by using their funds as his personal piggy bank despite filing false income tax returns claiming that he had almost no income.
Throw in a homicide charge, a framed picture of Russian President Vladimir Putin and some missing gold in the ceiling–and this is a wild story.
That wasn’t the only financial crime that made news this month. Four Pennsylvania men were charged in a scheme to steal tens of millions of dollars in government checks. According to court documents, two men who were working at a USPS facility took the checks from machines that processed Treasury checks (they hid them in their clothing and backpacks to smuggle them out to their cars).
The feds allege that the stolen checks were advertised for resale on Telegram, often showing images of the checks. Telegram is a cloud-based messaging platform, similar to iMessage or WhatsApp, that allows users a great deal of privacy and anonymity—for example, messages can be set to disappear. While there are many legitimate users, it has also become known as something of a digital “dark market” space.
There were thousands of stolen Treasury checks, valued at over $80 million–approximately $11 million of those were actually cashed.
Check theft has been a problem for years. This year, the federal government announced, in response to an Executive Order signed by President Donald Trump, that it would stop issuing paper checks by September 30 in favor of direct deposit, prepaid cards, or other digital payment options. According to the federal government, historically, Department of the Treasury checks have been 16 times more likely to be reported lost or stolen, returned undeliverable, or altered compared to electronic funds transfers (EFTs).
Paperwork could take an additional beating if the House and Senate provisions in the One Big Beautiful Bill Act (OBBBA) go into effect. Both versions of the bill (House and Senate) would increase the reporting threshold for Forms 1099-K and 1099-NEC, which means that fewer taxpayers would receive those forms at tax time.
For the 2025 tax year, the IRS requires third-party networks, such as payment apps and online marketplaces, to issue Form 1099-K if the aggregate payments received by a payee exceed $2,500, regardless of the number of transactions.
Also, for the 2025 tax year, the IRS requires those who pay independent contractors $600 or more to file Form 1099-NEC, Nonemployee Compensation, to report those payments.
Both the House of Representatives and the Senate propose repealing the $600 reporting threshold for Form 1099-K introduced by the American Rescue Plan Act in 2021. That move would restore the previous threshold of $20,000 and 200 transactions for Form 1099-K reporting.
And, both the House of Representatives and the Senate propose increasing the $600 reporting threshold for independent contractors or certain other payments reported on Form 1099-NEC to $2,000, adjusted for inflation.
If the reporting rules change, that should mean fewer forms for taxpayers. In 2023, the IRS estimated there could be up to 44 million Forms 1099-K sent to taxpayers (the official IRS projections—released in September 2024—suggested that the numbers were much smaller because of the delayed implementation of the $600 reporting threshold).
That doesn’t mean that there won’t be more recordkeeping requirements down the road. Also included in OBBBA? A 3.5% excise tax on international remittances sent by individuals who live in the United States but are not U.S. citizens or nationals. International remittances are typically transfers of money from individuals working abroad to those in their home countries. It can be a significant source of income, especially for those families in poorer countries.
The U.S. is the largest source of international remittances to lower-income countries—in 2022 U.S. remittances exceeded $79 billion. The second largest remitter—Saudi Arabia—sent a much smaller $39.3 billion. (Rounding out the top four are Switzerland and Germany.)
Here’s where the recordkeeping comes in. Under the bill, a qualified provider must agree in writing to verify whether customers are U.S. citizens or nationals. Some worry this will require providers to collect significant amounts of personal data on a large volume of transactions. While the bill doesn’t say how providers should verify status, it’s been suggested that “it would require the collection and verification of sensitive personal information such as Passport or Social Security number — which presents a very serious privacy concern.”
And there’s no mention of a minimum value threshold, which means transfer providers would have to keep track of everything. That means more paperwork, not less, as the U.S. seeks those records.
Speaking of records, it looks like there will be a lot of potential record high temps broken this weekend. A number of cities could approach or top 100 degrees including Denver (Salt Lake City already saw its first triple-digit high of the year). According to the National Weather City, New York City hasn’t reached 100 degrees since July 18, 2012, while Philly hasn’t reached 100 degrees in June since 1994. Boston’s last 100-degree high was on July 24, 2022.
Translation: It’s going to be hot. I recommend finding a cool spot to settle in and read the newsletter.
Enjoy your weekend,
Kelly Phillips Erb (Senior Writer, Tax)
Questions
This week, a taxpayer asked:
I’m just getting started in crypto. I know the basics of buying and selling, but can you explain what staking is and how I am taxed on it?
Sure. In simple terms, staking is similar to earning interest on your crypto—you get a reward, often in the form of more crypto—for making it available to others.
Some cryptocurrencies use a system called proof of stake to run their network—common examples include Ethereum (ETH) and Solana (SOL). These networks, in turn, use what are called validators to confirm blocks and secure the network.
Since the networks need validators, they solicit them from users. The easiest way to participate is through a staking pool or a platform, like Coinbase. If you agree to lock up a certain amount of crypto (meaning that you can’t sell or otherwise dispose of it for a period of time, even if the value goes down) for the network to use, that’s considered staking. As a reward, the network gives you something, typically more crypto.
For tax purposes, staking rewards are taxed as ordinary income when you receive them or when you have control over them. The value of the reward is based on the fair market value (FMV)—the amount a willing buyer would pay a willing seller. For most taxpayers, this will be reported on your tax return as “Other Income.”
Keep in mind that if you receive crypto as a staking reward, it’s taxable both when you receive it or have control over it (that’s the “Other Income” component) and when you sell or dispose of it (when any increase or decrease from its value when you received it as a staking reward will be treated as a capital gain or loss).
One quick additional note: if you participate in staking as a business, you’d report related income and losses on Schedule C as you would for any business.
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Do you have a tax question or matter that you think we should cover in the next newsletter? We’d love to help if we can. Check out our guidelines and submit a question here.
Getting To Know You
What does a tax professional look like? This week, meet Arielle Tucker, a cross-border Certified Financial Planner™ and Enrolled Agent, who helps U.S. expats build wealth while navigating the tax and financial complexities of life abroad.
When asked about the best tax or financial advice that anyone ever gave her, Arielle says, “The best time to start was yesterday. The next best time is now. This isn’t just tax and financial advice; it applies to most aspects of life.”
Arielle is the first to be featured in our rebooted Getting To Know You Tuesday series—a chance to get to know all kinds of tax professionals and understand that the field of tax is bigger than April 15. If you’d like to nominate a tax professional to be featured, send your suggestion to kerb@forbes.com with the subject: Getting To Know You Tuesday.
Statistics, Charts and Graphs
One of the biggest obstacles in the One Big Beautiful Bill Act is reconciling the House and Senate versions of the state and local tax (SALT) caps.
Currently, if you itemize your deductions, you can deduct state and local income taxes or sales taxes and state and local property taxes—but only up to a $10,000 cap for all these taxes combined. Without any action at all, the SALT cap would expire (before the Tax Cuts and Jobs Act (TCJA), there was no cap on the SALT deduction, other than the Pease limitations, which generally limited deductions for high-income taxpayers).
The version of the bill that passed the House raises the cap to $40,000 per household (the previous version had lifted the cap to $15,000 for singles and $30,000 for married couples filing jointly and some Republicans in the House had hoped to see it boosted to $60,000). The income phaseout—the point at which the value of the tax deduction would decrease as income increases—will begin at $500,000, instead of $400,000 in the previous bill. (For married taxpayers filing separately, the new deduction cap would be $20,000 and the income phaseout would begin at $250,000.) The cap and income phaseout would be subject to automatic annual increases of 1%.
The Senate Finance Committee’s version would keep the SALT deduction at $10,000, a figure that is generally considered a placeholder as both sides negotiate. High tax states stand to benefit the most, while those in Congress with an eye on the cost of the bill don’t see a plus in boosting the cap.
Remember that the deduction is a mix of state and local taxes (SALT)—that’s where the total tax burden matters. That means property taxes can vary wildly even inside the same state.
The above chart shows the property tax burden by state. However, as the Tax Foundation notes, providing a useful state-level comparison can be difficult—that’s why the map compares effective tax rates across states. The effective property tax rates represent the average amount of residential property taxes actually paid, expressed as a percentage of home value.
A Deeper Dive
A recent Tax Court opinion by Judge Goeke in Beaverdam Creek Holdings LLC pairs nicely with a prior opinion in Ranch Springs LLC. Both involve syndicated conservation easements on mining property in the South (Georgia and Alabama, respectively).
In syndicated conservation easement transactions, investors typically acquire an interest in a partnership that owns land and then claim what the IRS argues is an inflated charitable contribution deduction based on an overvalued appraisal.
(Syndicated conservation easements have been included in the IRS’ annual list of Dirty Dozen tax schemes for many years.)
The opinion includes a discussion of burden of proof and whether the appraisal was a qualified appraisal. The burden of proof did not shift from the taxpayer and the appraisal was a qualified appraisal. The contentious important issue was valuation, usually done by the “before and after” method. The “before and after” method of valuation involves determining the fair market value of a property before the easement is granted, and then determining the fair market value (FMV) of the same property after the easement is granted.
The argument that has been made by the industry is that the value that the easement gives (future value) might not be reflected in what the property would change hands for currently. Jones Day argued that accounts for property being valued for a conservation easement at a multiple of the value.
Beaverdam Creek Holdings LLC and Ranch Springs LLC were both represented by Jones Day. However, their innovative approach to valuation once again failed to sell a Tax Court judge. Both cases present a theory of valuation that would be game-changing if it prevails on appeal.
Tax Filings And Deadlines
📅 September 30, 2025. Due date for individuals and businesses impacted by recent terrorist attacks in Israel.
📅 October 15, 2025. Due date for individuals and businesses affected by wildfires and straight-line winds in southern California that began on January 7, 2025.
📅 November 3, 2025. Due date for individuals and businesses affected by storms in Arkansas and Tennessee that began on April 2, 2025.
Tax Conferences And Events
📅 June 26, 2025. Avalara CRUSH on Tour. Iron23 (Flatiron District), 29 West 23rd Street, New York, NY 10010. Registration required.
📅 July 1-September 16 (various dates), 2025. IRS Nationwide Tax Forum in Chicago, New Orleans, Orlando, Baltimore and San Diego. Registration required (discounts available for some partner groups).
📅 July 18-19, 2025. Tax Retreat “Anti Conference.” Denver, Colorado. Registration required.
📅 July 21-23, 2025. National Association of Tax Professionals Taxposium 2025. Caesars Palace, Las Vegas, Nevada. Registration required.
📅 July 22-24, 2025. Bridging the Gap Conference. Denver Marriott Tech Center, 4900 S. Syracuse Street, Denver, Colorado. Registration required.
📅 July 28-30, 2025. Tax Summit 2025. Grand America Hotel, Salt Lake City. Registration required.
Trivia
According to the Tax Foundation, the 16 counties with the highest median property tax payments all have bills exceeding $10,000. Eight of those counties were in the same state. Which state was it?
(A) California
(B) New Jersey
(C) New York
(D) Virginia
Find the answer at the bottom of this newsletter.
Positions And Guidance
The American Institute of CPAs (AICPA) has expressed appreciation to the Senate for efforts to “improve and correct” House Bill. The AICPA has identified several provisions it supports, including an increase in the standard deduction, inclusion of legislation to expand the use of section 529 accounts, and a provision related to expensing section 174 research and experimental (R&E) expenditures.
Noteworthy
Baker McKenzie has added former US Deputy Attorney General Rod J. Rosenstein in Washington, DC as a Partner in its Litigation and Government Enforcement Practice Group. As chair of the firm’s National Security Practice, Rod leads a team of former US government officials, former prosecutors, trade practitioners, and data privacy and cyber lawyers.
Robert Hallman has joined EisnerAmper as a partner in its international tax services group in Minneapolis. Hallman advises clients ranging from individuals to publicly traded multinationals on cross-border tax matters and global structuring strategies.
Norton Rose Fulbright has announced the addition of Jeff Korenblatt as a partner in its tax practice in Washington. Joining from Holland & Knight, Korenblatt focuses on the high-demand intersection of tax law, insurance and transactional risk mitigation.
The Chartered Institute of Management Accountants (CIMA) announced that John Graham, FCMA, CGMA, has been elected as the 92nd President of the Institute. He will also serve as 10th Co-Chair of the Association of International Certified Professional Accountants (the Association), the global alliance formed by AICPA and CIMA.
Indiana drivers will see a boost at the pump beginning July 1. The state’s 7% sales tax on gasoline purchases will be 17.5 cents/ gallon, up from 17.4 cents/gallon in June. The sales tax rate is separate from the 35 cents/gallon gasoline tax—by law, the gasoline tax goes up by 1 cent every July 1, which means that starting this July, the tax will be 36 cents/gallon.
The Arizona Senate has greenlighted a half-billion dollars for improvements to Chase Field, the home of the Arizona Diamondbacks. The bill allocates $500 million in sales taxes collected at the stadium over the next 30 years–the Diamondbacks are also required to chip in.
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In Case You Missed It
Here’s what readers clicked through most often in the newsletter last week:
You can find the entire newsletter here.
Trivia Answer
The answer is (B) New Jersey.
Bergen, Essex, Hunterdon, Monmouth, Morris, Passaic, Somerset, and Union counties have median property tax bills over $10,000. Six counties in New York (Nassau, New York, Putnam, Rockland, Suffolk, and Westchester counties) made the list. California (Marin County) and Virginia (Falls Church) each weighed in with one county.
Additionally, two counties in New Jersey (Hudson and Middlesex), three counties in California (San Francisco, San Mateo, and Santa Clara), and Western Connecticut Planning Region in Connecticut all have median property taxes paid above $9,000.
(Importantly, median property taxes are not the same as effective property tax rates.)
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