Bankruptcy is a second chance for an individual or business to to liquidate or reorganize debt with the goal of having a fresh financial start. Individuals and business can abuse this by frivolous filing, repeated filing, and manipulating of assets to appear to be in need of Bankruptcy protection. Couples can use divorce to hide assets, or move the liabilities from one person to another so are to remove the assets from the reach of the law. Tax fraud and return preparer fraud are also on a rise. What is important to know is like the financial statements, bankruptcy schedules and records are signed under perjury and they are penalties for misrepresenting the truth. 

Careless mistakes and math errors are usually a civil matter that can be corrected or penalized. A small percentage of cases make it to the Criminal Investigation division. The bankruptcy code, the Internal Revenue Code and other authorities are public information that CPA or enrolled agents will encounter if there is a tax client or a bankruptcy client. CPA may even find great careers on either side of from the government or in a tax or bankruptcy firm. Large dollar that may meet the discharge criteria are at stake for the client so it can be in important aspect of a CPA career. 

Name an famous tax or bankruptcy case and what were the issues and outcome?