IRS Reduces Administrative Burden (for the first time) of Filing Some Forms 3520 and/or Forms 3520-A

- By : Parag Patel

…trusts. Taxpayers who would otherwise be required to file Form 3520 and/or Form 3520-A, will not now be required to file these forms if they qualify for the relief set…

The IRS is Assessing Form 3520 Foreign Information Reporting Penalties

- By : Parag Patel

The IRS is aggressively sending out IRS Notice CP15 “Notice of Penalty Charge” for the late filing of Form 3520 to report the receipt of a foreign gift or foreign…

Beware of U.S. tax consequences to a foreign trust with a U.S. beneficiary

- By : Parag Patel

…at the close of the taxable year. (iv) The failure to timely file a complete and correct Form 3520 or Form 3520-A may result in an additional penalty of $10,000…

Protective Filing of Information Returns

- By : Parag Patel

…thresholds range from a low of $50,000 to a high of $600,000. It is advantageous to make a “protective” filing of tax returns or information returns. The primary reason is…

New Streamlined Domestic Offshore Procedures (SDOP) is a Game Changer

- By : Parag Patel

…U.S. law, and may have failed to file an FBAR (FinCEN Form 114, previously Form TD F 90-22.1) and/or one or more international information returns (e.g., Forms 3520, 3520-A, 5471,…

Method to Cure Delinquent or Incomplete Foreign Information Returns Without Penalties

- By : Parag Patel

…up to $10,000 and the penalty for a willful failure is the greater of $100,000 or 50 percent of the account balance. The various international-related information reporting rpenalties are also…

New IRS internal procedure guidance for Streamline Filing Compliance Procedures

- By : Parag Patel

…(Forms 3520, 3520-A, 5471, 5472, 8938, 926, or 8621) by e-mailing the CIS ID number to “*LB&I OVDP Compliance” with an explanation that the case is being forwarded due to…

Beware of Overlooked Common Overseas Tax Forms

- By : Parag Patel

…the highest value reached during the year and on the last day of the year. These thresholds range from a low of $50,000 to a high of $600,000. Other Overseas…

Full Analysis of Updated 2012 OVDP Program

- By : Parag Patel

…rules could result in a non-willful penalty of up to $10,000 per account per calendar year under 31 U.S.C. Section 5321(a)(5), for failure to file Form TD F 90-22.1 or…

New IRS Disclosure Program Announced for Non-Resident Taxpayers: Streamlined Foreign Offshore Procedures

- By : Parag Patel

…Income Tax Return, together with the required information returns (e.g., Forms 3520, 5471, and 8938) even if these information returns would normally be filed separately from the Form 1040 had…

Details of the Delinquent International Information Return Submission Procedures (DIIRSP)

- By : Parag Patel

…information returns. It applies to all the following international-related information returns: • Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation • Form 3520, Annual Return…

A solution in a tough tax season: the IRS Streamlined Offshore Procedures

- By : Parag Patel

…returns (e.g., Forms 3520, 3520-A, 5471, 5472, 8938, 926, and 8621) for the foreign financial asset; and (4) these failures resulted from non-willful conduct. To be eligible for the streamlined…

More Tax Complexity: New Form 8938

- By : Parag Patel

…$50,000 Highest Aggregate Value at Any Time During the Year: $100,000 Filing Status: Married Filing Joint Aggregate Value at Year End: $100,000 Highest Aggregate Value at Any Time During the…

Below is a List of Common Forms Applicable in Compliance Requirements for U.S. Citizens and Residents with Foreign Assets, Trusts, and Entities

- By : Parag Patel

…Specified Foreign Financial Assets Foreign Trusts Reporting Forms Form 3520-A Annual Information Return of Foreign Trust With a U.S. Owner Form 3520 Annual Return to Report Transactions With Foreign Trusts…

New IRS IRM with Updated Streamlined Filing Compliance procedures

- By : Parag Patel

…filings. Any line marked with a # is for Official Use Only 1 IRM PROCEDURAL UPDATE DATE: 05/09/2016 NUMBER: WI-21-0516-0879 SUBJECT: BMF International Accounts Management AFFECTED IRM(s)/SUBSECTION(s): 21.8.2 CHANGE(s): IRM…

The Misunderstood Extension of time to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR)

- By : Parag Patel

…person with an interest in, or signature or other authority over, one or more foreign financial accounts whose aggregate value exceeds $10,000 at any time during a calendar year is…

Instructions for New Streamlined Filing Compliance Procedures for Non-Resident, Non-Filer U.S. Taxpayers

- By : Parag Patel

…information returns (e.g. Form 3520 or 5471), for the past three years and to file delinquent FBARs (Form TD F 90-22.1) for the past six years. Payment for the tax…

The legal standard of “willfulness”: Opt out to avoid high penalties

- By : Parag Patel

…of up to 10 years in jail and a $500,000 fine. The IRS must prove willfulness in order to assert the $500,000 monetary penalty and the imprisonment for up to…

Checklist of tax forms for taxpayers with foreign assets

- By : Parag Patel

…of Foreign Financial Assets — This is a new tax form that is expected to be required for anyone with more than $50,000 in foreign financial assets in 2010. A…

New Extended Deadline for OVDI

- By : Parag Patel

…Information Return of U.S. Persons With Respect To Certain Foreign Corporations, and Form 3520, Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts, where all…

Foreign bank account reports (FBARs) and the 2011 Offshore Voluntary Disclosure Initiative (2011 OVDI)

- By : Parag Patel

…such account. The IRS previously extended to June 30, 2011, the FBAR filing due date for such persons for 2009 and earlier calendar years. (Notice 2009-62 (8/7/09), Notice 2010-23 (2/26/2010))….

IRS Releases FAQs for the Delinquent International Information Return Submission Procedures

- By : Parag Patel

…penalty for the failure to file the delinquent Forms 5471 and 3520 if there are no under-reported tax liabilities and you have not previously been contacted regarding an income tax…

Frequent Scenarios in Offshore Voluntary Disclosures

- By : Parag Patel

…bequest a Report of Foreign Gift or Bequest (Form 3520) may also need to be filed. Whether the U.S person has dominion or control over the account is determined by…

The IRS is Hiring: Expect New Enforcement

- By : Parag Patel

…will be more audits with respect to Forms 5471 (owners of a foreign corporation), 3520/3520A (owners and beneficiaries of foreign trusts), 8621 (PFICs, including foreign mutual funds) and 8865 (owners…