Tag Archives: amnesty
To Opt Out or Not Opt Out: That is the Question
When is it appropriate to make a quiet disclosure vs. making a disclosure through the Offshore Voluntary Disclosure Program? This question is not necessarily easy to answer. IRS agents handling OVDI/OVDP cases do not have discretion regarding offshore-related information return
Opting Out of the OVDI Program: Argue for No Penalty and a Warning Letter
The revised IRS OVDP FAQs offer helpful guidance on the opt-out option. The newly revised FAQs illustrate the pros and cons of opting out with examples. Depending on the circumstances, we sometimes recommend some clients to opt out of the
IRS collects over $5 billion in its its offshore voluntary disclosure programs
The Internal Revenue Service (IRS) has announced that its offshore voluntary disclosure programs (OVDPs) have collected more than $5 billion, and that it has tightened the eligibility requirements of the third program it opened in January this year. “We continue
Full Analysis of Updated 2012 OVDP Program
The Internal Revenue Service announced on June 26, 2012 (IR-2012-64) that it is tightening eligibility requirements for the open-ended offshore voluntary disclosure program (2012 OVDP) that it announced in January 2012 for taxpayers with unreported income or assets, generally in
IRS offers tax opportunity to Americans living abroad
Many Americans (including US citizens and US green card holders) living abroad will get a small reprieve from U.S. Internal Revenue Service rules on reporting foreign assets, the agency announced on Tuesday. The IRS said it would allow some U.S.
OVDP Ineligibility Possibility Increases
Yesterday the IRS stated that taxpayers’ eligibility to participate in the OVDP could be terminated if the foreign institution where you have your account faces IRS action. Once the U.S. government has taken action against a financial institution, any U.S.
IRS Announces Penalty Mitigation for Smaller US Taxpayers Living Abroad
The Internal Revenue Service appears to have finally created a process to finally separate small non-resident (foreign resident) US taxpayers from larger non-resident US taxpayers at the front end, and not force everyone through the OVDI/OVDP programs. Yesterday, the IRS
OVDI: Requesting issuance of a FBAR warning letter instead of penalties
In a Tax Notes Today report of statements made at the Eastern Pennsylvania Working Together Conference in Malvern, PA, Jason Kuratnick, IRS Associate Area Counsel (Philadelphia), Small Business / Self-Employed Division is reported to have said: The IRS may send
Opting-out of the Offshore Voluntary Disclosure Initiative: FBAR Penalty Mitigation Guidelines
Depending on the circumstances, we sometimes recommend some taxpayers to opt out of the voluntary disclosure initiative and allow us to demonstrate the absence of willfulness and avoid the normal FBAR penalty regime. We have been aggressively pursuing OVDI opt-outs
The legal standard of “willfulness”: Opt out to avoid high penalties
Under IRS Form 1040, at the bottom of Schedule B, Part III, on Page 2, Question 7(a) states: “at any time during the previous year, did you have any interest in or signatory or other authority over a financial account
Should I close my foreign account?
Suppose you have a foreign bank account holding more than $10,000. You may have inherited it, used it to hide money during a dispute with your spouse or business partner, or just done it on a whim. As you try
Global Enforcement of FATCA: Something to Worry About
The Foreign Account Tax Compliance Act (FATCA) is about disclosure and transparency, but in part is to catch Americans trying to stash money overseas. Controversially, FATCA orders every foreign bank to track down its U.S. account holders, and then share
Difference between Form 8938 and FBAR Requirements
Comparison of Form 8938 and FBAR Requirements Many holders of foreign financial assets must file two disclosure forms this year or else risk draconian penalties. They are Form 8938, which is due with the tax return itself, and
More Tax Complexity: New Form 8938
In recent years, the IRS and US Treasury have stepped up their efforts toward tracking down delinquent tax payers and enforcing payment of overdue taxes. One of these initiatives has been labeled the “Foreign Account Tax Compliance Act”. FATCA is
Form 8938, FATCA, FBAR and penalties for all (including bankers)
The IRS and US Treasury have stepped up their efforts toward tracking down delinquent tax payers and enforcing payment of overdue taxes. One of these initiatives is the “Foreign Account Tax Compliance Act”. FATCA is part of the Hiring Incentives
Frequent Scenarios in Offshore Voluntary Disclosures
I have frequently seen the following scenarios in working with clients to determine whether a offshore voluntary disclosure program filing (OVDP) is appropriate and how they should report foreign account. First, a parent or grandparent entrusts a younger generation family
Eleven foreign financial institutions to share their US customer account information
US authorities have offered eleven financial institutions a settlement agreement in which the US government’s investigations in those financial institutions — for aiding tax evasion — and potential prosecution would be dropped. The eleven financial institutions are: 1. Credit Suisse
The Teeth of the Foreign Account Tax Compliance Act (FATCA)
The Foreign Account Tax Compliance Act (FATCA) is about disclosure and transparency, but in part is to catch Americans trying to stash money overseas. Controversially, FATCA orders every foreign bank to track down its U.S. account holders, and then share
American Citizens Abroad (ACA) writes letter to IRS Commissioner regarding unfair offshore asset treatment
American Citizens Abroad (ACA) has written to IRS Commissioner Doug Shulman of the IRS to express the organization’s profound concern that he has not answered the Directive issued by National Taxpayer Advocate Nina Olson. In her report to Congress issued
No tax = No Passport?
The United States Senate has passed a provision in proposed legislation that would allow the State Department to deny, limit or revoke passports to citizens with “seriously” delinquent taxes. The passport provision is part of the Fight Offshore Tax Abuses
New IRS Form 8938 Statement of Foreign Financial Assets is causing significant confusion
As anticipated, IRS Form 8938 Statement of Foreign Financial Assets is causing significant confusion among taxpayers attempting to complete these Forms for filing. Form 8938, Statement of Specified Foreign Financial Assets, is a new reporting form, which will be used to
Analysis of the new 2012 Offshore Voluntary Disclosure Program (OVDP)
Yesterday the Internal Revenue Service opened its Offshore Voluntary Disclosure Program (OVDP) to encourage more taxpayers with assets in undeclared foreign bank accounts to come forward. While the OVDP was not expected by most tax lawyers and professionals, it may
IRS Announces New 2012 Offshore Voluntary Disclosure Program (OVDP)
The Internal Revenue Service today reopened the offshore voluntary disclosure program to help people hiding offshore accounts get current with their taxes. The IRS reopened the Offshore Voluntary Disclosure Program (OVDP) following continued strong interest from taxpayers and tax practitioners
Beware: IRS Form 8938 Statement of Specified Foreign Financial Assets
Form 8938, Statement of Specified Foreign Financial Assets, is a new reporting form. Form 8938 will be used to report certain foreign financial assets as required as part of the Hiring Incentives to Restore Employment Act (HIRE Act), which was
Another Bank Discloses Accountholders: Credit Suisse to Turn Over U.S. Account Data
Earlier this month Credit Suisse Group AG, Switzerland’s second-biggest bank, told U.S. clients it is giving confidential client account data to the Swiss tax authorities, who will decide whether to disclose it to the Internal Revenue Service. The U.S. is
Fifth HSBC India Customer indicted for tax evasion this year
A federal grand jury in San Jose, California, last week indicted Ashvin Desai of San Jose on three counts of tax evasion, two counts of willfully aiding the preparation of materially false tax returns and three counts of failing to
The Risks of “Opting Out” of OVDI
Under the 2011 OVDI voluntary disclosure program, the penalties for failing to timely file Foreign Bank Account Reports, (FBAR’s) and the penalties for failure to file information returns (such as Controlled Foreign Corporation tax returns) were combined into a single
What if You Missed the OVDI Deadline?
Although the OVDI program has expired, a U.S. taxpayer can still make a voluntary disclosure of foreign accounts pursuant to the IRS’s general voluntary disclosure policy. For over 50 years, the IRS has maintained a voluntary disclosure policy, under which
HSBC India Customer New Indictment Uncovers More HSBC Details
A Wisconsin neurosurgeon was re- indicted by a U.S. grand jury on new charges that he failed to declare an HSBC Holdings Plc (HSBA) account in India valued in 2009 at $8.7 million. Arvind Ahuja was indicted again by a
For Tax Professionals: A Guide to the IRS’s Voluntary Disclosure Practice
IRS Commissioner Shulman has invited persons with unreported foreign accounts to come forward and avail themselves of the IRS’s Voluntary Disclosure Practice. That practice is described in the Internal Revenue Manual 9.5.11.9. The Practice has a bearing upon whether the
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