Fort Lauderdale, FL.
A crucial IRS deadline is approaching for those taxpayers that have bank accounts or other financial accounts in foreign countries. Michael Sullivan, of Fresh Start Tax LLC , states, "Any US taxpayer with a foreign bank and/or financial account with a value of $10,000 or more during the calendar year must file IRS form TD F 90-22.1 by June 30th, 2012. Failure to do so could lead to criminal prosecution and seizure of assets." The Internal Revenue Service has found a literal gold mine of revenue in taxpayers who do not report their interest or ownership in Foreign Bank and Financial Accounts ("FBAR").
The FBAR Program is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent the law. Investigators use the FBARs to identify unreported income maintained or generated abroad. In 2009, the Internal Revenue Service ("IRS") collected over 4 billion dollars in revenue from people who failed to file the form.
"According the to the Treasury Inspector General, IRS has dedicated millions of dollars to enforcing the FBAR Program", states Sullivan, a former IRS Agent. In talking to fellow IRS Agents, Sullivan found that the IRS will be aggressively pursuing these FBAR cases. Sullivan knows what the triggers are with taxpayers – their pocketbook and jail. Mention those two things to a taxpayer and they will turn tricks for you. The IRS and IRS Agents know exactly how to play that game. For more information, please visit http://freshstarttax.com/fbar-irs-tax-representation/
Who Is Required to File
Any United States person, with few exceptions, who has a financial interest in, or signature authority or other authority over, any foreign financial account(s) in a foreign country, with the aggregated value of these accounts exceeding $10,000 at any time during the calendar year, must file Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts. Foreign financial accounts include, but are not limited to, a checking/savings bank account, brokerage account, mutual fund, trust or other type of foreign financial account.
What Needs to Be Reported on Form TD F 90-22.1
Personal information (name, address and Social Security number)
Maximum value of the account during the calendar year;
Type of account (i.e., bank, securities, etc.);
Name of financial institution;
Account number, and;
Mailing address of financial institution.
*** The IRS defines maximum account value as the largest amount that appear on any quarterly or more-frequently issued account statement during the tax year.
Penalties for Failure to File FBARs
Although the FBAR form is an information return and it does not impose any tax by itself, failure to file this report may result in significant civil and criminal penalties. Civil penalties range from $500 to 50% of the account value, per violation, depending on whether such failure to file was willful. Criminal penalties range from $10,000 to $500,000, including incarceration of up to 10 years.
Recent focus of the IRS and U.S. government on offshore accounts makes it even more important for taxpayers with foreign financial accounts to consult with tax an experienced tax attorney and/or accountant and determine their filing obligations.
Fresh Start Tax is a professional tax resolution firm. On staff are Board Certified Tax Attorneys, CPAs, and Former IRS Agents, Managers and Instructors. We have over 206 years of professional tax experience and over 60 years of direct IRS experience. To learn more about Fresh Start Tax, LLC, please visit http://freshstarttax.com/ or call us at (866) 700-1040.