by Fresh Start Tax | Oct 6, 2012 | Back Taxes, Expatriate Tax, FBAR, Income Tax Preparation, Tax Lawyer, Tax Returns
Yes the IRS is really trying to help, well, help them get you to file FBAR reports.
There is a new FBAR procedure out that may help many taxpayers and individuals.
If you are responsible to file a FBAR this better be on your radar screen. The IRS and the DOJ has been very active in going after tax cheats and non- filers. Country by country the IRS is coming your way.
When UBS gave in to US pressure it was just a matter of time that other countries would be next.
When Lichtenstein went down there was a clear sent that the IRS and the DOJ was going country by country. Each country is giving way to US demands and is turning over account information of all US citizens.
Our advice to all our clients, find the IRS before they find you.
We are comprised of Board Certified Tax Attorneys, Lawyers CPA’s and Former IRS Agents. We are FBAR experts. We can help with Foreign Retirement Accounts and Pension Plans.
Call us today for a free tax consult, 1-866-700-1040. Speak directly to a Tax Attorney or Lawyer.
The Internal Revenue Service announced a plan to help U.S. citizens residing overseas, including dual citizens, catch up with tax filing obligations and provide assistance for people with foreign retirement plan issues.
The IRS will provide a new option to help some U.S. citizens and others residing abroad who have not been filing tax returns and provide them a chance to catch up with their tax filing obligations if they owe little or no back taxes.
The new procedure will go into effect on Sept. 1, 2012.
The IRS is aware that some U.S. taxpayers living abroad have failed to timely file U.S. federal income tax returns or Reports of Foreign Bank and Financial Accounts .
Some of these taxpayers have recently become aware of their filing requirements and want to comply with the law.
To help these taxpayers, the IRS offered the new procedures that will allow taxpayers who are low compliance risks to get current with their tax requirements without facing penalties or additional enforcement action.
These people generally will have simple tax returns and owe $1,500 or less in tax for any of the covered years.
The IRS also announced that the new procedures will allow resolution of certain issues related to certain foreign retirement plans (such as Canadian Registered Retirement Savings Plans).
In some circumstances, tax treaties allow for income deferral under U.S. tax law, but only if an election is made on a timely basis.
The new streamlined procedures will be made available to resolve low compliance risk situations even though this election was not made on a timely basis.
Taxpayers using the new procedures will be required to file delinquent tax returns along with appropriate related information returns for the past three years, and to file delinquent FBARs for the past six years.
Submissions from taxpayers that present higher compliance risk will be subject to a more thorough review and potentially subject to an audit, which could cover more than three tax years.
The IRS also announced its offshore voluntary disclosure programs have exceeded the $5 billion mark, released new details regarding the voluntary disclosure program announced in January and closed a loophole used by some U.S. citizens.
by Fresh Start Tax | Oct 4, 2012 | Expatriate Tax, FBAR, Tax Lawyer
Are you Afraid to File FBAR and Amending your Tax Returns?
Do not be worried, file. Stop the worry. 1-866-700-1040
You need to file your FBAR Reports and file your amended tax returns before IRS comes knocking.
The bottom line is this, if you file before contacted by the IRS you will probably avoid prison time however, you still will have to pay the tax but the penalties can possibly be settled.
Not everyone is a tax cheat or a tax crook.
Not everyone is going to jail or will be sentenced. The IRS hangs over the head of all FBAR filers the possibility of sentencing. The CI unit of the IRS or the Criminal Division is not interested in individuals who did not know or the individual who was not willful or intentional of not filing FBARS and amended tax returns, IRS is interested in the large dollar individuals with the intent to deceive and evade paying taxes.
It is critical if you are to take anything out of this article is to absolutely make sure you file your FBAR report and file any and all amended tax returns that should and need to be addressed.
Without question, the IRS will eventual hunt you down. The Foreign banks and financial institutions have gave way to US pressure and are turning over names and bank accounts numbers and dollar amounts to the DOJ and the IRS.
There is now a matching program that is taking place. Once the IRS CADE 2 computers are fully loaded, individuals will be getting letters and notices from IRS and possibly from the criminal division about unfiled FBAR Reports and income that individuals have failed to report.
When UBS gave way Lichtenstein followed and soon everyone will be country will be included. Most investors have little to worry about. They can simple file FBAR and amend their tax return, pay the tax and walk away.
You may want to call our office to find out more detail regarding your individual situation.
Each case is unique and there are no two cases the same.
So , what ever you do, make sure your file all FBAR’s and amended tax returns before the IRS finds you, Michael D. Sullivan
The requirements:
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 any other type of foreign financial account, the Bank Secrecy Act ( BSA ) 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). You can find the form on our website.
If you are required to file a federal income tax return and fail to do so, or you fail to pay the amount of tax shown on your federal income tax return, you may be subject to a penalty under Internal Revenue Code (IRC) section 6651, unless you show that the failure is due to reasonable cause and not due to willful neglect.Call us to avoid penalty and interest. 1-866-700-1040. Speak directly to a tax attorney.
The Penalty
The penalty is 5 percent of the amount of tax required to be shown on the return. If the failure continues for more than one month, an additional 5 percent penalty may be imposed for each month or fraction thereof during which the failure continues.
The total failure to file penalty cannot exceed 25 percent.
Please Note – that there is no penalty if no tax is due.
If you fail to pay you tax
If you fail to pay the amount of tax shown on your federal income tax return, you may be subject to a penalty for failing to pay under IRC section 6651(a)(2), unless you show that the failure is due to reasonable cause and not due to willful neglect.
The penalty begins running on the due date of the return (determined without regard to any extension of time for filing the return) and is 1/2 percent of the amount of tax shown on the return. If the failure continues for more than one month, an additional 1/2 percent penalty may be imposed for each additional month or fraction thereof that the amount remains unpaid.
The total failure to pay penalty cannot exceed 25 percent.
Note that there is no penalty if no tax is due.
Under IRC section 6651(c)(1), the failure to file penalty is reduced by the amount of the failure to pay penalty for any month in which both apply.
Call us today and speak directly to a Tax Attorney or Tax Lawyer. 1-866-700-1040
by Fresh Start Tax | Oct 3, 2012 | Expatriate Tax, FBAR, Offshore Tax Problems, Representation, Tax Lawyer
FBAR Filing Help – Late, Unfiled, Delinquent – Representation & Negotiation – Fresh Start Tax LLC – Attorneys, Former IRS
Michael D. Sullivan is Former Award Winning IRS Agent and Teaching Instructor with the Internal Revenue Service. Mr. Sullivan worked in the local, district and regional offices of the IRS.
Mr. Sullivan has been in private practice since 1982 and is a tax expert in the field of Federal and State Tax Resolution.
FBAR filing is certainly been a hot topic of late. The Department of Justice ( DOJ ) and the IRS has made this priority number one due to the huge amounts of tax revenue it has brought in to the US economy. FBAR filing and paying has been a huge boost to the coffers of the US Treasury. $5.5 Billion has already been collected when 33,000 individuals came forward.
Both government agencies ( IRS and DOJ ) have made this a priority and with the fear of going to jail a record number of individuals are coming forward to file back, late and or delinquent FBAR Reports and Amended Tax Returns.
IRS keep a list of prosecutions on there website. You will find out the fine amounts and the sentencing involved.
The individual has basically two options.
Option number one is to make what is called a ” quiet disclosure.” A Quiet disclosure is simply filing and FBAR report and amending your tax returns. The second option is to contact CI and file through CI.( Criminal Investigation )
There are pro’s and con’s to both. It is critical to contact a Tax Attorney or Tax Lawyer to help make these decision. Those decisions are based on your individual history and fact pattern on your unique case. Many factors are taking into consideration before an opinion can be rendered.
How do you report FBAR and amending your tax returns.
Filers report their foreign accounts by (1) completing boxes 7a and 7b on Form 1040 Schedule B, box 3 on the Form 1041 “Other Information” section, box 10 on Form 1065 Schedule B, or boxes 6a and 6b on Form 1120 Schedule N and (2) completing Form TD F 90-22.1 (PDF).
When is the FBAR due?
The FBAR is due by June 30 of the year following the year that the account holder meets the $10,000 threshold. The granting, by IRS, of an extension to file Federal income tax returns does not extend the due date for filing an FBAR.
PLEASE NOTE – Filers cannot request an extension of the FBAR due date. Due date is the due Date!
Filing and amended FBAR
If you need to amend, FBAR filers can amend a previously filed FBAR by:
a. Checking the Amended box in the upper right-hand corner of the first page of the form,
b. Making the needed additions or corrections,
c. Stapling or attaching it to a copy of the original FBAR and
d. Attaching a statement explaining the additions or corrections.
If you fail to file a FBAR Report.
Failure to file an FBAR when required may potentially result in civil penalties, criminal penalties or both. Much depends on your case history and amount of tax owed and intent or lack thereof.
If you learn you were required to file FBARs for earlier years, file the delinquent, late or past due FBAR reports and attach a statement explaining why the reports are filed late.
Be careful with this statement. It is best to have a tax attorney or tax lawyer write this letter.
No penalty will be asserted if the IRS investigator determines that the late filings were due to reasonable cause. This is the reason a quite disclosure is sometimes recommended.
Can a cumulative FBAR penalties exceed the amount in a taxpayer’s foreign accounts?
This is a killer but the answer is yes!
Under the current penalty provisions found in 31 U.S.C. 5314(a)(5), it is possible to assert civil penalties for FBAR violations in amounts that exceed the balance in the foreign financial account.
For simple FBAR Reporting and amending of tax returns there is no reason why individuals cannot do this on there own. Forms are available online.
If you are not sure about your situation and have other issues, it is highly recommended to a call us today for a no cost tax consult. 1-866-700-1040.
FBAR Filing Help, Amending Tax Returns, Representation & Negotiation, Attorneys, Former IRS, Ex-Pat Representation
by Fresh Start Tax | Oct 2, 2012 | Expatriate Tax, FBAR, Offshore Program, Offshore Tax Problems, Tax Lawyer
Make sure you file all FBAR reports because the IRS and the Department of Justice is putting in systems and getting cooperation for foreign banks and financial institutions to turn over the names of all account holders all over the world.
FBAR is coming your way because of the huge success that the Department of Justice and the IRS has had on the FBAR Program over the past 3 years.
IRS and the Department of Justice collected just north of $5 billion dollars as a result of the first couple of FBAR programs. Over 33,000 persons came forward and many many more are about to ante up to avoid jail time.
IRS and the DOJ hold the threat of prison time over the heads of non-filers and non reporters and the best advice we can give you is to” find the IRS before they find you.”
With the break through of UBS and Liechtenstein, the IRS and the DOJ is working there way country by country.
Why to use Fresh Start Tax LLC.
We are comprised of Board Certified Tax Attorneys, Tax Lawyers, CPA’s and Former IRS agents. We have over 205 years pf professional tax experience and over 60 years of working directly for the IRS in the local, district and regional offices.
We taught Tax Law and know all the tax procedures, thinking and settlement objectives of the IRS. We have a world wide tax practice.
News from Liechtenstein that will effect other countries including Italy and the surrounding areas.
You should known that Liechtenstein was never thought to give away to US pressure. It was such a small country. A little Alpine ski resort of 36,000 persons, it was a tax free haven for years for persons wanting to hide their money free of government reprisal. It was one of the greatest of all tax havens. For many tax professionals involved it was the country of choice because it was called the Teflon Tax country.
The US came in hard and the with the pressure Liechtenstein gave way.
Liechtenstein finally informed on their Bank Clients on the U.S. Tax Evasion Request
Liechtenstein has told all their American clients of the principality’s oldest bank that U.S. authorities have requested their account data as they widen a tax evasion and potential tax fraud probe.
Accounts at’ Liechtensteinische Landesbank AG (LLB)” that contained at least $500,000 at any time since the beginning of 2004 are covered by the information request, according to a May 30 letter sent to a client by the principality’s tax authority.
Who is required to file FBAR.
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.
International Interests:
Individuals or Businesses with International Interests, if you need help or assistance in the following areas call us today: 1-866-700-1040
1. Reporting required for foreign corporations, partnerships, and trusts,
2. Tax Treatment of Passive Foreign Investment Companies,
3. Foreign Bank Account Reporting and consultations,
4. Donations to foreign charities by United States private foundations,
5. Determination for residency for income tax purposes for Foreign Nationals,
6. A Application of Tax Treaties and Totalization Agreements to minimize United States Tax,
7. State residency and Domicile issues,
8. Analysis of foreign tax credit(s) versus foreign earned income exclusions for US expatriates.
The triggering mechanism – The United States Bank Secrecy Act
The US Congress passed the Bank Secrecy Act in 1970 as the first laws to fight money laundering in the United States. The BSA requires businesses to keep records and file reports that are determined to have a high degree of usefulness in criminal, tax, and regulatory matters.
The documents filed by businesses under the BSA requirements are heavily used by law enforcement agencies, both domestic and international to identify, detect and deter money laundering whether it is in furtherance of a criminal enterprise, terrorism, tax evasion or other unlawful activity.
The Internal Revenue Service is a partner in the U.S. National Money Laundering Strategy. The IRS seeks to achieve a balance between enforcement of the money laundering laws and education. This page provides links to information about specific BSA requirements to assist with education and compliance with the law.
by Fresh Start Tax | Sep 30, 2012 | Expatriate Tax, FBAR, Tax Lawyer
We have over 206 years of combined IRS tax experience and over 60 years of working directly for the Internal Revenue Service in the local, district and regional offices of the IRS.
Why chose us.
We can take the fear of FBAR and overseas issue away from individual because of our vast knowledge and experience at the IRS. We taught Tax Law at the IRS and understand their tax policies and settlement strategies.
The Offshore Voluntary Disclosure Program.
You have two options.
1. You can opt in to the voluntary disclosure or,
2.Consider the “quiet disclosure.
You should call us directly to find out which program is best for you. Each case and fact pattern is different and after we hear all the facts we can make a determination and give you a recommendation which of the options best suits your needs.
The Internal Revenue Service voluntary disclosure is a program in which all filing go directly through IRS.
So far the IRS has had total collections of more than $4.4 billion so far from the two previous international programs.
The third offshore program comes as the IRS continues working on a wide range of international tax issues and follows ongoing efforts with the Justice Department to pursue criminal prosecution of international tax evasion. This program will be open for an indefinite period until otherwise announced.
After the third offshore effort, the IRS has collected $3.4 billion so far from people who participated in the 2009 offshore program, reflecting closures of about 95 percent of the cases from the 2009 program. On top of that, the IRS has collected an additional $1 billion from up front payments required under the 2011 program. That number will grow as the IRS processes the 2011 cases.
In all, the IRS has seen 33,000 voluntary disclosures from the 2009 and 2011 offshore initiatives. Since the 2011 program closed last September, hundreds of taxpayers have come forward to make voluntary disclosures.
The Penalty Structure
The overall penalty structure for the new program is the same for 2011, except for taxpayers in the highest penalty category.
For the new program, the penalty framework requires individuals to pay a penalty of 27.5 percent of the highest aggregate balance in foreign bank accounts/entities or value of foreign assets during the eight full tax years prior to the disclosure.
That is up from 25 percent in the 2011 program. Some taxpayers will be eligible for 5 or 12.5 percent penalties; these remain the same in the new program as in 2011.
Participants must file all original and amended tax returns and include payment for back-taxes and interest for up to eight years as well as paying accuracy-related and/or delinquency penalties.
Participants face a 27.5 percent penalty, but taxpayers in limited situations can qualify for a 5 percent penalty. Smaller offshore accounts will face a 12.5 percent penalty.
Exception $75,000
People whose offshore accounts or assets did not surpass $75,000 in any calendar year covered by the new OVDP will qualify for this lower rate. As under the prior programs, taxpayers who feel that the penalty is disproportionate may opt instead to be examined.
The IRS recognizes that its success in offshore enforcement and in the disclosure programs has raised awareness related to tax filing obligations.
This includes awareness by dual citizens and others who may be delinquent in filing, but owe no U.S. tax.
The IRS is currently developing procedures by which these taxpayers may come into compliance with U.S. tax law. The IRS is also committed to educating all taxpayers so that they understand their U.S. tax responsibilities.
Call us today and to learn more and speak directly to a Tax Attorney, Tax Lawyer or Former IRS. We can stop the worry today.
by Fresh Start Tax | Sep 30, 2012 | Back Taxes, Expatriate Tax, FBAR, Tax Lawyer, Tax Returns
If you are a US citizen living in Singapore or the surrounding region and have issues regarding FBAR or Expatiate questions, call us today so we can help with any tax issue or potential tax problems you may have. 1-866-700-1040.
We can relieve your worry today. We are FBAR and Expatiate Tax Experts and have over 206 years of total tax experience and we have over 60 combined years with the IRS in the local, district and regional offices of the IRS.
FBAR filing requirement
For those of you have have a FBAR requirement, that is you are required to file FBAR because you had 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 you 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), call us today to find out if this requirement applies to you.
What are the terms of the 2011 Offshore Voluntary Disclosure Initiative?
Under the terms of the 2011 Offshore Voluntary Disclosure Initiative, taxpayers must:
1. The taxpayer must provide copies of previously filed original (and, if applicable, previously filed amended) federal income tax returns for tax years covered by the voluntary disclosure;
2. The taxpayer must provide complete and accurate amended federal income tax returns (for individuals, Form 1040X, or original Form 1040 if delinquent) for all tax years covered by the voluntary disclosure, with applicable schedules detailing the amount and type of previously unreported income from the account or entity (e.g., Schedule B for interest and dividends, Schedule D for capital gains and losses, Schedule E for income from partnerships, S corporations, estates or trusts).
3. The taxpayers must file complete and accurate original or amended offshore-related information returns (see FAQ 29 for certain dissolved entities) and Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts, commonly known as an “FBAR”) for calendar years 2003 through 2010;
4.Cooperate in the voluntary disclosure process, including providing information on offshore financial accounts, institutions and facilitators, and signing agreements to extend the period of time for assessing tax and penalties;
5. The taxpayer must pay 20% accuracy-related penalties under IRC § 6662(a) on the full amount of your underpayments of tax for all years;
6. The taxpayers must pay failure to file penalties under IRC § 6651(a)(1), if applicable;
7. The taxpayers must pay failure to pay penalties under IRC § 6651(a)(2), if applicable;
8. The taxpayer must pay, in lieu of all other penalties that may apply, including FBAR and offshore-related information return penalties, a miscellaneous Title 26 offshore penalty, equal to 25% (or in limited cases 12.5% (see FAQ 53) or 5% (see FAQ 52)) of the highest aggregate balance in foreign bank accounts/entities or value of foreign assets during the period covered by the voluntary disclosure;
9. The taxpayers must submit full payment of all tax, interest, accuracy-related penalty, and, if applicable, the failure to file and failure to pay penalties with the required submissions set forth by code.
10. The taxpayer must execute a Closing Agreement on Final Determination Covering Specific Matters, Form 906.
You also have another option that you want to hear and know more about.
You have the ability to make a quiet disclosure by filing amended tax returns without notifying IRS. Call us today to find out more and speak directly to a Tax Attorney or Tax Lawyer. 1-866-700-1040. This is called a quiet disclosure.
