by Fresh Start Tax | May 2, 2013 | FBAR
FBAR 2014 – IRS looking to be much more Aggressive – Filing & Paying 1-866-700-1040
Just why is IRS being more aggressive on FBAR Cases?
Simply put, that’s where the money is!
If you are looking for FBAR professional tax representation contact us today for a no cost professional tax consult.
We are comprised of tax attorneys, certified public accountants, and former IRS agents and managers with over 60 years working directly for the Internal Revenue Service in the local, district, and regional tax offices of the Internal Revenue Service.
First 3 years of FBAR reporting
After the first three years of a full-court press by the Internal Revenue Service regarding FBAR filing, reporting, paying and the receiving of amended tax returns, the IRS collected over $5 billion.
With this sort of money on the line do not expect the IRS to go away soon.
As a matter of fact, the latest IRS budget has shown that they are going to put a considerable amount of their enforcement revenue on the foreign tax compliance act FTCA).
Some of the reports indicate that the return on investment is anywhere from 3 to 1 to 6 to 1 so don’t expect this to go away soon.
What is helping IRS to be more aggressive.
Country by country is giving into the IRS demands to turn over financial records that belong to US citizens and Americans that should’ve filed tax returns and who have failed to do so.
Nobody ever thought that Lichtenstein would fall into the United States demands however it did cave in to US pressure. As a result the dominoes start to fall.
As a result the IRS is using their criminal enforcement to go ahead and force people into becoming fully compliant. The Internal Revenue Service keeps on their website a list of all those that have fallen to FBAR along with her current sentences matching the penalty of their crimes.
I should also state that many of these taxpayers with unfiled FBARs are very simple and do not require much effort to get fully compliant. I would imagine that 90% of all Fbar cases fall in the simple to easy category.
It best to reach out to the Internal Revenue Service before they reach out to you.
If the IRS reaches out to you first, without question you could be involved in a criminal prosecution. However, if you reach out to them it is very doubtful that you will have to worry about any criminal activities.
The whole goal here is to keep this a civil matter and make sure you file and pay the correct amount of taxes so you can avoid fear and worry at a later date.
Implement Foreign Account Tax Compliance Act (FATCA) 2013 and beyond
This initiative will provide the resources for the IRS to implement changes required by of FATCA included in the Hiring Incentives to Restore Employment (HIRE)(PublicLaw111-147).
ROI of $3.7 to $1.
New reporting, disclosure, and withholding requirements will produce additional annual enforcement revenue of $115.4 million once the new hires reach full potential in FY 2016,an ROI of $3.7 to $1.
Address International and Offshore Compliance Issues.
This initiative will strengthen enforcement activities to address offshore tax evasion and expand the IRS’s global presence and pursuit of international tax and financial crimes. The IRS continues to address tax-avoidance schemes involving offshore activity.
This request will address the significant growth in international activities in the global tax environment and produce additional annual enforcement revenue of $192.8 million, once the new hires reach full potential in FY 2016,an ROI of $4.5 to $1.
Who is required to File and Pay
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 Bank Secrecy Act may require you to report the account yearly to the Internal Revenue Service by filing Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR).
The FBAR is required because foreign financial institutions may not be subject to the same reporting requirements as domestic financial institutions.
The FBAR is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent United States law.
Investigators use FBARs to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad.
Recent FBAR Guidance
On February 24, 2011, the Treasury Department published final regulations amending the FBAR regulations. These regulations became effective March 28, 2011, and apply to FBARs required to be filed with respect to foreign financial accounts maintained in calendar year 2010, and for FBARs required to be filed with respect to all subsequent calendar years.
The FBAR form and instructions (PDF) have been revised to reflect the amendments made by the final regulations.
Financial Crimes Enforcement Network (FinCEN)
On May 31, 2011, the Financial Crimes Enforcement Network (FinCEN) issued FinCEN Notice 2011-1 (PDF), revised June 6, 2011, to provide filing deferral to certain individuals with signature authority over, but no financial interest in, foreign financial accounts of their employer or a closely related entity.
The filing deadline for employees and officers to report signature authority over these accounts was extended to June 30, 2012, for the following individuals:
An employee or officer of an entity under 31 CFR § 1010.350(f)(2)(i)-(v) who has signature or other authority over and no financial interest in a foreign financial account of a controlled person of the entity; or
An employee or officer of a controlled person of an entity under 31 CFR § 1010.350(f)(2)(i)-(v) who has signature or other authority over and no financial interest in a foreign financial account of the entity, the controlled person, or another controlled person of the entity.
For purposes of FinCEN Notice 2011-1, a controlled person is a United States or foreign entity more than 50 percent owned (directly or indirectly) by an entity under 31 CFR § 1010.350(f)(2)(i)-(v).
On June 17, 2011, FinCEN issued Notice 2011-2 (PDF) to provide filing deferral for certain officers or employees of investment advisors registered with the Securities and Exchange Commission who have signature authority over, but no financial interest in, foreign financial accounts of their employer.
The filing deadline for employees and officers to report signature authority over these accounts was similarly extended to June 30, 2012.
Due to additional questions and concerns regarding the signature authority filing exceptions within Notice 2011-1 and Notice 2011-2, FinCEN twice extended the revised filing deadlines imposed by those two notices.
On February 14, 2012, FinCEN issued FinCEN Notice 2012-1 (PDF), extending the reporting deadline to June 30, 2013, for signature authority reporting of the employees and officers identified in Notice 2011-1 and Notice 2011-2, to the same extent of reporting as originally set forth in those notices.
More recently, on December 26, 2012, FinCEN issued Notice 2012-2, further extending this same filing deferral to June 30, 2014.
All other U.S. persons required to file an FBAR this year are required to meet the June 30, 2013 filing date.
On Jan 9, 2012, the IRS reopened the Offshore Voluntary Disclosure Program following continued interest from taxpayers and tax practitioners after the closure of the 2011 and 2009 programs. This program will be open for an indefinite period until otherwise announced.
Who Must File an FBAR
United States persons are required to file an FBAR if:
1. The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
2. The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.
United States person means United States citizens; United States residents; entities, including but not limited to, corporations, partnerships, or limited liability companies created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.
Exceptions to the Reporting Requirement
Exceptions to the FBAR reporting requirements can be found in the FBAR instructions. There are filing exceptions for the following United States persons or foreign financial accounts:
a. Certain foreign financial accounts jointly owned by spouses;
b. United States persons included in a consolidated FBAR;
c. Correspondent/nostro accounts;
d. Foreign financial accounts owned by a governmental entity;
e. Foreign financial accounts owned by an international financial institution;
f. IRA owners and beneficiaries;
g. Participants in and beneficiaries of tax-qualified retirement plans;
h. Certain individuals with signature authority over but no financial interest in a foreign financial account;
i. Trust beneficiaries; and
j. Foreign financial accounts maintained on a United States military banking facility.
Reporting and Filing Information
A person who holds a foreign financial account may have a reporting obligation even though the account produces no taxable income. Checking the appropriate block on FBAR-related federal tax return or information return questions (for example, on Schedule B of Form 1040, the “Other Information” section of Form 1041, Schedule B of Form 1065, and Schedule N of Form 1120) and filing the FBAR, satisfies the account holder’s reporting obligation.
The FBAR is not filed with the filer’s federal income tax return.
The granting, by the IRS, of an extension to file federal income tax returns does not extend the due date for filing an FBAR.
You may not request an extension for filing the FBAR. The FBAR is an annual report and must be received by the Department of the Treasury in Detroit, MI, on or before June 30th of the year following the calendar year being reported. While FinCEN strongly encourages individuals to electronically file FBARs, the form can be mailed to one of the two addresses below, provided that the mailing is received by June 30, 2013:
File by mailing the FBAR to:
United States Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621
If an express delivery service is required for a timely filed FBAR, address the parcel to:
IRS Enterprise Computing Center
ATTN: CTR Operations Mail room, 4th Floor
985 Michigan Avenue
Detroit, MI 48226
Delivery messenger service contact telephone number: (313) 234-1062.
Account holders who do not comply with the FBAR reporting requirements may be subject to civil penalties, criminal penalties, or both.
Electronic Filing for FBAR Forms – MANDATORY Beginning July 1, 2013
On June 29, 2011, FinCEN announced that all FinCEN forms must be filed electronically with certain exceptions.
The FBAR was granted a general exemption from mandatory electronic filing through June 30, 2013. E-filing is a quick and secure way for individuals to file FBARs. Filers will receive an acknowledgement of each submission.
For more information about FBAR e-filing, read the FinCEN news release.
New Reporting Requirements by U.S. Taxpayers Holding Foreign Financial Assets (Form 8938)
by Fresh Start Tax | May 2, 2013 | FBAR
Unfiled, Past Due FBAR – FBAR Experts – FBAR Reporting 1-866-700-1040
The last thing you want to do is have a letter or a knock on your door from the Internal Revenue Service indicating that you have not filed past-due FBAR reports.
The feds are digging in deep to all taxpayers who were required to file FBAR reports and the reason is quite simple.
Over the last three filing seasons the Internal Revenue Service has collected $5 billion in revenue just from those taxpayers coming forward and amending unfiled or past-due FBAR returns and the related income tax returns.
With this type of money on the line, the federal government is beefing up their resources to go ahead and continue the revenue hunt and bring those who have unfiled or past due FBARs to criminal prosecution.
It is in your best interest to make sure you come forward before the Internal Revenue Service reaches out to you.
Once you are contacted by the Internal Revenue Service it may be too late because you could find yourself in the middle of a criminal investigation with both the Department of Justice and the IRS.
I should inform you that most of these cases are very simple and I do not want taxpayers to be alarmed or to live in fear. Simply by making a voluntary disclosure you can live without the worry or fear.
If you have any questions we can help relieve any of the fear you have as a result of unfiled or past due FBAR reports. Simply call us today and you will speak directly to a certified FBAR tax attorney expert who can help you take care of the situation once and for all. Remember reach out to IRS before they reach out to you.
We are comprised of Tax Attorneys, CPA’s and Former IRS Agents. We know the IRS system inside and out. We have over 60 years of direct IRS work experience in the local, district and regional offices of the IRS. We also taught Tax Law at the IRS.
As a general rule IRS will not enforce criminal penalties if you contact them before they contact you. The key is letting IRS know you will be filing your tax returns. At this point it only becomes a civil matter.
As a general rule, we contact IRS by filing a power of attorney so you will never speak to the IRS. We handle all the negotiations and settle the case so you pay the lowest amount allowed by law including the abatement of penalties and interest if your case warrants.
Who needs to file FBAR
A person or individual who holds a foreign financial account may have a reporting obligation even though the account produces no taxable income.
How to file Unfiled or Past due FBARs
Checking the appropriate block on FBAR- related federal tax return or information return questions (for example, on Schedule B of Form 1040, the “Other Information” section of Form 1041, Schedule B of Form 1065, and Schedule N of Form 1120) and filing the FBAR, satisfies the account holder’s reporting obligation.
FBAR is not filed with,
The FBAR is not filed with the filer’s federal income tax return. The granting, by the IRS, of an extension to file federal income tax returns does not extend the due date for filing an FBAR.
Due Date for FBAR
You may not request an extension for filing the FBAR. The FBAR is an annual report and must be received by the Department of the Treasury in Detroit, MI, at one of the two addresses below, on or before June 30th of the year following the calendar year being reported.
File by mailing the FBAR to:
United States Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621
If an express delivery service is required for a timely filed FBAR, address the parcel to:
IRS Enterprise Computing Center
ATTN: CTR Operations Mail room, 4th Floor
985 Michigan Avenue
Detroit, MI 48226
Call us today for a no cost consultation and speak directly to a Tax Attorney or Former IRS agent 1-866-700-1040.
Unfiled, Past Due FBAR – FBAR Experts, FBAR Reporting – Professional Tax Firm, Nationwide
by Fresh Start Tax | May 2, 2013 | Tax Help
Why you need to File FBAR Form – Tax Attorneys, Help with FBAR Experts 1-866-700-1040
Within the last three years the federal government is on a mission to make sure all taxpayers file all required FBARs and related amended tax returns if applicable.
The government is putting much of their resources into the hunting down taxpayers that have not filed FBAR and the reason is simple, the feds have collected $5 billion in the last three years from those coming forward and amending their tax returns as a result of a FBAR crackdown.
Leverage that the federal government using, you get your vacation time in club Fed.
You also will be reading in the media the arrests and prosecutions that are taking place to shake up and alert taxpayers to make sure they understand the consequences of not reporting and paying taxes on income sources.
This information is not being written to scare you but to make you aware that you can be walking into a hornets nest if the IRS contacts you before you contact them.
Should the IRS contact you before you make a voluntary disclosure you very well may be looking at a criminal situation that includes present time.
It is in your best interest to contact a tax attorney from our office and have a free consultation to discuss your matter.
Most of these situations are very simple and can be resolved very easily.
It is worth your time to hear what we have to say to you so you do not have to worry about the letter or the knock on the door from the Internal Revenue Service.
As a former IRS agent myself I want to impress upon you the fact that Fbar will never go away
The government is taking this very serious and is not worth it for taxpayers to roll the dice on this issue. Country by country is giving into the United States demands to go ahead and turn over the financial records from institution holding accounts belonging to taxpayers in the United States.
Remember it is your goal to contact the IRS before they contact you a you will never have to worry about any problem arising.
FBAR Reporting
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 Bank Secrecy Act may require you to report the account yearly to the Internal Revenue Service by filing Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR).
The FBAR is required because foreign financial institutions may not be subject to the same reporting requirements as domestic financial institutions. The FBAR is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent United States law.
Investigators use FBARs to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad.
Recent FBAR news of Arrests
Two Phoenix businessmen have been convicted by a jury on federal tax charges for failure to disclose secret offshore bank accounts in Switzerland.
DOJ – The Justice Department and Internal Revenue Service announced April 12 that Stephen M. Kerr and Michael Quiel were charged with filing false income tax returns individually for 2007 and 2008.
Kerr also received two counts of failing to file a Report of Foreign Bank and Financial Accounts (FBAR).
Also involved was San Diego attorney Christopher M. Rusch who previously pleaded guilty to conspiracy to defraud the government and failing to file an FBAR on Feb. 6.
“This prosecution serves notice that the Department of Justice will not tolerate fraudulent activity designed to undermine the integrity of our income tax system,” said U.S. Attorney for the District of Arizona John S. Leonardo.
According to trial evidence, Kerr, Quiel, Rusch and others established nominee foreign entities and corresponding bank accounts at UBS AG and Pictet & Cie to conceal their ownership and control of stock and income that were deposited into the accounts.
Rusch admitted and testified at trial that he and others caused the sale of the shares of stock through undeclared accounts.
Rusch’s responsibility was to facilitate the domestic sale of 11.4 million shares of stock held in the name of a foreign entity controlled by Kerr.
In order to conceal that the money was income to Kerr, Rusch would transfer the proceeds from the sale of stock to an undeclared foreign account at UBS AG.
Approximately $2 million was transferred by Rusch through his Interest on Lawyer’s Trust Account (IOLTA) before dispersing the money for Kerr and Quiel.
Thereafter Kerr purchased a golf course in Erie, Colo. Additionally, Quiel instructed Rusch to write checks payable to an Arizona bank account owned and controlled by Quiel after the transfer of approximately $955,000 from his undeclared foreign account to Rusch’s IOLTA account.
Reportedly Kerr and Quiel filed false tax returns with the IRS that did not report the proceeds of stock sales, interest and dividend income earned through the secret accounts. Their accountants testified that neither Kerr nor Quiel disclosed their offshore accounts during the preparation of their tax returns.
Individually Kerr also failed to file FBARs in 2007 and 2008 that reported his offshore accounts to the IRS.
“Many investigations are underway and focusing upon an ever wider circle of banks worldwide, their clients and others who would help the clients try to hide income and assets offshore,” said Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally.
“The lesson of today’s guilty verdicts is that no hiding place will prove safe enough.”
Call us today for free initial consultation fee and never have to worry about any fear from the Internal Revenue Service.
Why you need to File FBAR Reports – Tax Attorneys, Help with FBAR Experts
by Fresh Start Tax | May 2, 2013 | Back Taxes
How to File & Pay Back Taxes, Former IRS, Back Taxes Experts 1-866-700-1040
If you need to file and pay back taxes you have come to the right place.
We are comprised of tax attorneys, certified public accountants and former IRS agents and managers who have over 60 years of direct work knowledge and experience working at our favorite ex-boss with the IRS.
Our firm has over 206 years of professional tax experience and we are A+ rated by the Better Business Bureau and have been in private practice since 1982.
We handle all areas of IRS representation including the filing of back taxes and the payment of back taxes including the IRS tax settlement called the offer compromise.
How to file back taxes
Most people come to us needing to file multiple back years tax returns and the common questions that ask is “should I file them all at the same time?”
And the answer is a resounding yes.
You do this so you can close your case all that one time and in doing so you will save yourself tons of money.
Most people who have to file multiple years are hesitant because of fear or worry or they have lost their tax records to complete the filing of their tax returns. If this is your case we should be able to remove your fear and worry and file all your back years tax returns and work out a tax settlement with the Internal Revenue Service. If you have lost, stolen or damaged tax records that is no problem.
If this is the case do not be alarmed or afraid because you don’t have the all your tax records to file your back tax returns. We are tax experts in tax reconstruction in the filing of back income and business tax returns.
We have filed thousands of reconstructed tax returns and we know the exact process and we can make this very simple for you.
If you need to pay your back taxes you must fill out form 433-F
There are multiple tax options in paying your back taxes and the key to doing so is the completion of the IRS financial statement form 433-F.
The Internal Revenue Service will close no case off their enforcement computers unless they have a current and documented financial statement.
You can find that 433-F on our website. Complete it and send it to us and we will do a free tax evaluation on your case and will let you know how the IRS will treat or handle your for entity that owes tax.
Some taxpayers cannot pay back taxes
Factors that support an economic hardship determination may include:
The taxpayer is incapable of earning a living because of a long term illness, medical condition or disability, and it is reasonably foreseeable that the financial resources will be exhausted providing for care and support during the course of the condition.
The taxpayer may have a set monthly income and no other means of support and the income is exhausted each month in providing for the care of dependents.
The taxpayer has assets, but is unable to borrow against the equity in those assets, and liquidation to pay the outstanding tax liabilities would render the taxpayer unable to meet basic living expenses.
Someone in the immediate family of the taxpayer has been hit with a catastrophe.
An act of God causing an unforeseen occurrence.
Remember, each situation is different and each and every case is based on its own merit.
No two cases are ever the same.
If you cannot pay your back taxes IRS can place you into a currently non-collectible file.
IRS will review your current financial statement and may determine that at the present time your expenses exceed your income and that aligns with the national and regional standard test that IRS uses to determine hardship, payments and IRS tax debt settlement. So if this is you contact us today we will review your financial statement and see if you are a true candidate for an economic tax hardship called currently noncollectable.
IRS making payments to the Internal Revenue Service
There are many programs available to you to help you make back payments to the Internal Revenue Service.
Once again your 433F financial statement will allow IRS to see how much that monthly payment should be.
There is also another tool available to the taxpayer and that is to make a streamlined payment for those of you who owe under $50,000 and can pay IRS off within six years.
Contact us today to learn more about the program by making a payment or installment arrangement to the Internal Revenue Service.
Paying back taxes with a tax debt settlement: Offer and Compromise
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can’t pay your full tax liability, or doing so creates a financial hardship.
The Internal Revenue Service will consider your unique set of facts and circumstances such as:
a. Ability to pay;
b. Income;
c. Expenses; and
d. Asset equity.
The IRS generally approve an offer in compromise when the amount offered represents the most we can expect to collect within a reasonable period of time.
You should explore all other payment options before submitting an offer in compromise. The Offer in Compromise program is not for everyone.
Make sure you are eligible for a Tax Settlement
Before the IRS will can consider your offer, you must be current with all filing and payment requirements.
Are you in an open bankruptcy proceeding
You are not eligible if you are in an open bankruptcy proceeding. Use the Offer in Compromise Pre-Qualifier to confirm your eligibility and prepare a preliminary proposal.
Submitting your offer
You’ll find step-by-step instructions and all the forms for submitting an offer in the Offer in Compromise Booklet, Form 656-B (PDF).
Your completed offer package will include:
1. Form 433-A (OIC) (individuals) or
2. 433-B (OIC) (businesses) and all required documentation as specified on the forms;
Form 656(s) – individual and business tax debt (Corporation/ LLC/ Partnership) must be submitted on separate Form 656;
3. $150 application fee (non-refundable); and
Initial payment (non-refundable) for each Form 656.
Select a payment option
Your initial payment will vary based on your offer and the payment option you choose:
Lump Sum Cash.
Submit an initial payment of 20 percent of the total offer amount with your application. Wait for written acceptance, then pay the remaining balance of the offer in five or fewer payments.
Periodic Payment.
Submit your initial payment with your application. Continue to pay the remaining balance in monthly installments while the IRS considers your offer. If accepted, continue to pay monthly until it is paid in full.
How to File & Pay Back Taxes, Former IRS, Back Taxes Experts
