Banks and certain other financial institutions located outside the United States that have U.S. account holders are scrambling to meet a looming IRS deadline. These institutions, known as foreign financial institutions, or FFIs, must achieve full compliance with the U.S.
The new Loose Filed Forms 5471 targeted enforcement campaign was identified through LB&I data analysis and suggestions from IRS employees. IRS employees likely received many Loose Filed Forms 5471 that were not properly filed, as a result, the suggested the
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
The new Offshore Private Banking enforcement campaign was recently identified through LB&I data analysis and suggestions from IRS employees. IRS employees likely saw that many taxpayers were not properly reporting offshore bank accounts, as a result, they suggested the campaign.
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
The Delinquent International Information Return Submission Procedures are one of the four methods for taxpayers with unreported offshore accounts to become compliant. Taxpayers who have failed to file certain international-related information returns. It applies to all the following international-related information returns:
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.
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,
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
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
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
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
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
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
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
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
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 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
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
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
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) announced last week that, to implement the new due date for FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), of April 15 (April 18 for 2017), it will automatically
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
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
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
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
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.
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
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
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
We have had many clients with unreported foreign mutual funds. As a result, it is time to revisit the unfavorable topic of foreign mutual funds as a “Passive Foreign Investment Companies” (PFICs), which is often a surprise to our clients. U.S.