Tag Archives: FBAR
Caution: Increased FBAR Enforcement
The last month or so has unfortunately seen a lot of FBAR enforcement court rulings against US taxpayers and in favor of the government. The Financial Crimes Enforcement Network (FinCEN) of the Department of the Treasury can levy high penalties
Reasonable Cause Defense Denied: FBAR Penalties Assessed by Court
In the recent 2019 case U.S. v. Ram Agrawal, a US District Court rejected a taxpayer’s reasonable cause defense against foreign bank account reports (FBARs) penalties. It ruled in favor of the government to collect FBAR penalties for the
Details of the Streamlined Foreign Offshore Procedures (SFOP)
Many U.S taxpayers are unfortunately surprised to discover that they have a U.S. tax reporting obligation on financial accounts or assets held overseas. Once they discover their tax and reporting obligation, there are a number of programs through which they
Details of the Streamlined Domestic Offshore Procedures
Many U.S taxpayers are unfortunately surprised to discover that they have a U.S. tax reporting obligation on financial accounts or assets held overseas. Once they discover their tax and reporting obligation, there are a number of programs through which they
New IRS Voluntary Disclosure in 7 Steps
The following are the seven steps of the new updated IRS voluntary disclosure process: A taxpayer will make a voluntary disclosure preclearance request using IRS Form 14457 to IRS Criminal Investigation (CI). Taxpayers can request preclearance via mail or fax.
IRS Updated Voluntary Disclosure Practice is a Game-Changer
Last week the IRS released a memorandum with new procedures for an “Updated Voluntary Disclosure Practice” impacting all voluntary disclosures. The new updated voluntary disclosure practice (VDP) is a game-changer for offshore voluntary disclosures for US persons with unreported foreign assets. The
New Post-OVDP IRS Voluntary Disclosure Procedures Announced
The Internal Revenue Service released new updated procedures for voluntary disclosures since the old Offshore Voluntary Disclosure Program (OVDP) closed on September 28, 2018. Last week, IRS deputy commissioner Kirsten Wielobob issued Interim Guidance Memo LB&I-09-1118-014, Updated Voluntary Disclosure Practice (PDF) on
Federal District Court Holds that FBAR Penalties in Excess of $100,000 is Unlawful
Recently, the U.S. District Court for the Western District of Texas in U.S. v. Colliot, determined that an individual who repeatedly failed to timely file Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts, commonly referred to as an FBAR,
New FBAR Court Case Makes it Easier for Taxpayers to be Deemed Willful
There is a debate as to the “burden of proof” that must be met by the Internal Revenue Service (IRS) in asserting that an FBAR violation was “willful”. This is significant because those who willfully fail to file the required
Denied access to or withdrew from the IRS Offshore Voluntary Disclosure Program (OVDP)?
This year taxpayers who either were denied access to or withdrew from the IRS Offshore Voluntary Disclosure Program (OVDP) have been receiving Letter 5935 (HERE) from the IRS notifying them that they need to come into compliance with U.S. reporting requirements
New Unreported Offshore Assets case: Bad facts leads to bad results
A resident of Connecticut who was originally from Korea has been hit with a record civil penalty of $14M, a six month prison sentence, and a fine of $100,000 for failing to report Swiss bank accounts totaling around $28M, the
IRS Passport Revocation or Denial for Unpaid Taxes
Two years ago, Congress passed Internal Revenue Code Section 7345. This law allows the Internal Revenue Service (IRS) to work with the US State Department to suspend and/or deny the passports of taxpayers with seriously delinquent tax debts. The IRS plans
IRS Announces New Investigative Units
In a press call on August 2, 2017, the Chief of the Internal Revenue Service’s (IRS) Criminal Investigation Division (“IRS-CI” or CID), John D. Fort, announced two new enforcement initiatives: a National Coordinated Investigations Unit and an International Tax Enforcement
New Court Case Limits the Reasonable cause exception to FBAR penalties
Taxpayers across the country rely on advice from their accountants and CPAs to meet the complicated requirements of the U.S. Tax Code. But a new case, Jarnagin v United States, in the U.S. Court of Federal Claims suggests that CPA
New IRS practice unit: “Substantial compliance” doctrine, international information return penalties
The IRS Large Business and International (LB&I) division last week publicly released a “practice unit” that addresses what the term “substantially complete” means with reference to international information return penalties, particularly Form 5471. The IRS recently released a new International Practice
U.S. Taxpayers at New Risk of Audit from OVDP Declines and Withdrawals Campaign
Last year, the US Treasury Inspector General for Tax Administration (TIGTA) released a report which assessed how well that IRS was managing the Offshore Voluntary Disclosure Program (OVDP). OVDP is one of the programs taxpayers may use to become compliant
FATCA Noncompliant Accounts may be Frozen or Blocked
Many of our clients with foreign accounts have received FATCA letters. The letters seek personal information regarding the account holder in order to comply with the US FATCA law. In recent weeks, government authorities in a few foreign countries have
The Misunderstood Extension of time to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR)
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) announced an automatic six-month extension for taxpayers required to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR). Taxpayers now have until October 16 to submit their FBARs for
2016 US Dept of Justice (DOJ) Tax Division: FBAR penalty collection cases
The US Dept of Justice (DOJ) Tax Division recently published it annual summary highlights of civil tax matters. The publication is linked here (Updated through December 16, 2016), and contains brief summaries DOJ Tax activity (decisions, court filings, etc.). Last year it
IRS Announces new OVDP Declines-Withdrawals Campaign
Earlier this month, the IRS’ Large Business and International division released its list of 13 focus areas for issue- based examinations and concerns for compliance. One of those areas involves the IRS Offshore Voluntary Disclosure Program. Entitled, “OVDP Declines-Withdrawals
ABA Conference with Government Officials
The ABA recently held a conference titled National Institute on Criminal Tax Fraud and Institute on Tax Controversy. I attended the conference where many tax attorneys and government officials discussed issues of interest. Also discussed was the effect of streamlined
New IRS IRM with Updated Streamlined Filing Compliance procedures
The Internal Revenue Manual (IRM) is essentially the IRS employee handbook on how to carry out all administrative and procedural matters, such as how to audit specific tax returns, collect taxes, process returns, or assess penalties. The IRM may be
FBAR Reforms Recommended
If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, exceeding certain thresholds, the Bank Secrecy Act may require
IRS Collects $10 Billion From Voluntary Disclosures of Foreign Assets
The Internal Revenue Service’s efforts to prod taxpayers to disclose their offshore bank accounts and pay taxes on their holdings have reached the $10 billion mark and prompted over 100,000 taxpayers to come forward, the IRS said last Friday in
Cost of Compliance Rises under OVDP
The cost of compliance for many people is growing. Those U.S. persons with bank accounts in foreign jurisdictions who have yet to come into compliance with U.S. tax filing requirements have very little time. In addition to the increased amount
Substantially Completed Form 5471 is Required to be Filed
IRS has recently released a new International Practice Unit (IPU) providing guidance to its examiners on the monetary penalties applicable if certain categories of U.S. shareholders fail to comply with the reporting requirements on Form 5471 (Information Return of U.S.
New FATCA Enforcement Expected
The IRS has tightened its enforcement of the Foreign Account Tax Compliance Act (“FATCA”). FATCA was enacted in 2010 by Congress to target non-compliance by U.S. taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs), i.e., foreign banks, to
Trinidad and Tobago and the United States sign new agreement to exchange of information under FATCA
Last week Trinidad and Tobago and the United States signed an agreement to facilitate automatic exchange of information under the US Foreign Account Tax Compliance Act (FATCA). FATCA, enacted by the US Congress in 2010, is intended to ensure that
NY Art Consultant Indicted for Filing False Tax Returns and Failing to File FBARs
Last week, on July 28, 2016, the United States Department of Justice announced an indictment against Lacy Doyle for obstructing the administration of tax laws and filing false foreign bank account report (FBARs). Doyle was arrested in New York. In
India and the US have agreed to collaborate on offshore tax evasion
India and the US have agreed to again enhance collaboration on tackling offshore tax evasion and increase cooperation in sharing of cross-border tax information after the United States Treasury and India’s Ministry of Finance met last week. Following the conclusion
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