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October 28, 2013


Sophia Loren Wins Tax Evasion Case Thirty Years Later

Sophia Loren, Italy’s iconic actress has been fighting charges levied against her for over 30 years. In 1974 Italian officials claimed the actress attempted to evade taxes. Ms. Loren voluntarily surrendered and went to jail in 1982 for 17 days of a 30 day sentence. Ms. Loren claimed that her deceased tax preparer had made a mistake.

After an incredibly long battle, the Rome-based Court of Cassation has now ruled that Ms. Loren was correct when she calculated tax on her 1974 income.

Some would question whether or not the IRS exceeded the statute of limitations. In Ms. Loren’s case, the IRS needed more than the six years allotted by the statute of limitations and asked Ms. Loren to sign a form extending the statute. Tax advisers tend to advise clients to agree.

However, in a case of criminal tax evasion, the statute hasn’t run if the taxpayer is indicted within six years after “willfully attempting in any manner to evade or defeat any tax or the payment thereof.” The statute also stops running if the target is outside of the U.S. Not only that, but it can be difficult to pinpoint when exactly the tax crime was committed.

Offshore Accounts/International Tax Disputes