Offshore Account Disclosures
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, the US Government requires that you file TDF 90-22.1 Report of Foreign Bank and Financial Accounts (FBAR), with the Internal Revenue Service.
The Form is a tool to help the United States government identify persons who may be using foreign financial accounts to avoid paying US Taxes or to circumvent US Laws. Government investigators use this form to identify and trace funds used for illicit purposes or to identify unreported income. Unfortunately while most taxpayer's whom fail to comply with this reporting requirement do so for reasons other than tax evasion motives, the IRS will still aggressively investigate and prosecute taxpayers.
The penalty for non-compliance with FBAR filings can be incredibly harsh. The willful failure in failing to file an FBAR can result in both criminal sanctions (i.e., imprisonment for up to 5 years) and civil penalties amounting to the greater of s of the highest account balance in an unreported foreign account for each account since 2006.
The statue of limitations for civil penalties for non-compliance of FBARs is 6 years, however if during the course of the IRS audit the revenue agent suspects possible criminal motives, the IRS is free to open up the statute of limitations to include years prior. It is absolutely important that should you be audited, to seek competent and adequate representation immediately.
2012 Offshore Voluntary Disclosure Program
The Offshore Voluntary Disclosure Initiative (OVDI) provides taxpayers with unreported Foreign Bank Accounts an opportunity to get current on their tax returns while avoiding potential Criminal penalties while also limiting potential civil penalties.
Beginning in January of 2012, the IRS decided to open up its OVDI program once again for taxpayers wanting to come into compliance with all Foreign Bank Account Requirements. Unlike the prior programs in 2009 and 2011, the 2012 OVDI program does not have a firm ending date; the IRS is also free to change who can enter and the level of penalties.
The OVDI program is a program administered through the Criminal Investigations Unit at the IRS. It is absolutely imperative that prospective clients with a desire to enter into the OVDI program engage a licensed attorney as only the communications between a taxpayer and his or her attorney are shielded from the IRS.
My firm has the experience and expertise in helping clients enter into prior OVDI programs with favorable results. Together with our team of CPAs, we assist taxpayers in entering into the OVDI program with proven success. The steps taken include the following:
(1) Initial application screening and processing (the IRS Criminal Investigations Unit needs to approve each application before granting admittance into the program)
(2) Filing the previous 6 years of tax returns (taking into consideration any miss tax savings opportunities)
(3) Calculating penalties
(4) Filing backed FBARs
(5) Communicating directly with the IRS
On June 18th the Internal Revenue Service (IRS) announced changes to its Offshore Voluntary Disclosure Program (OVDP) to give low compliance risk taxplayers an opportunity to “come clean” for not filing US Tax Returns through changes to Streamlined Program.
Prior to June 18th, the Streamlined OVDP program allowed low level compliance risk taxpayers residing outside the United States to enter into the streamlined program to resolve their tax liability. With the announced changes on June 18th, the program is now open to taxpayers residing within the US. Under the new Streamlined provisions a Taxpayer qualifies for the reduced penalty amount of 5% (down from the 27.5%) if the Taxpayer can demonstrate that the non-compliance was a result of non-willfull conduct. The IRS has defined Non-willful conduct as, conduct that is due to negligence, inadvertence, or mistake or conduct that is the result of a good faith misunderstanding of the requirements of the law.
是: 美國1-415-685-0813, 香港: 852-6463-4298. 或請參閲我們的綱站