[SamAdams76]

FWIW, I was told by a member of my family who works for the IRS that if your income is between $35,000 a year and $100,000 a year, that your chances of getting an audit is virtually zilch. Reasoning is that the IRS suspects people making less than $35,000 a year might be "hiding" income and those making under $100,000 (but more than $35,000)won't have enough "bang for the buck" to make the audit worth it. However there are flags that might still cause those in the middle to get an audit, the biggest one being taking deductions for a "home office."

[Southack]

The methods mentioned in the article are all old hat.

A St. Louis attorney is currently convincing rich businesswomen to convert their income streams into an arrangement wherein an ESOP (an "employee" owned stock plan) owns an S corp.

S corps don't pay taxes, but rather pass income directly to owners, who then pay taxes. But ESOP's don't pay taxes (they distribute money directly to employees).

Thus, this new arrangement legally dodges all federal income taxes.

A rather high-level IRS executive admitted to me personally that they've already lost two court cases trying to stop this "scam", and that until Congress changes the law that this thing is going to snowball as more people learn about it.

It certainly puts the old scams of off-shore credit-cards to shame. Who needs to hide a little income and risk jail when they can legally dodge all federal income taxes, after all?!