The Internal Revenue Service (IRS) has announced plans to initiate dozens of new audits this spring in an attempt to ground high-flying taxpayers and their personal usage of corporate aircrafts. These audits will focus primarily on “highest risk” corporations and large partnerships, IRS Commissioner Danny Werfel stated. Werfel added that audits of high-income earners will likely follow to “ensure that high-income groups are not flying under the radar.”
by Andrew C. Liazos, Ira B. Mirsky, Anne G. Plimpton and Ruth Wimer
A recent shareholder derivative action alleges that the directors of Chesapeake Energy breached their fiduciary duties to shareholders by, among other things, misleading shareholders about the true extent and true cost of personal use of the company’s aircraft. The complaint raises questions about disclosure practices that could affect how public companies determine the aggregate cost of perquisites on proxy statements. It appears that the plaintiffs’ bar is already targeting potential plaintiffs for similar cases using the lure of whistleblower recoveries.
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