by Fresh Start Tax | Dec 18, 2012 | FBAR
FBAR Instructions – FBAR Filing & Reporting – FBAR Experts
We are comprised of Tax Attorneys, Tax Lawyers, CPA’s and Former IRS Agents, Managers and Instructors.
We have over 205 years of professional tax experience and over 60 years of working directly for the IRS.
We can help you with the filing of FBAR, FBAR Instructions and FBAR Reporting requirements.
You may call us for a no cost professional tax consultation. 1-866-700-1040.
On June 26, 2012, the IRS announced new streamlined filing compliance procedures for non-resident U.S. taxpayers to go into effect on September 1, 2012.
These procedures FBAR Filings are being implemented in recognition 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 (FBARs), Form TD F 90-22.1, but have recently become aware of their filing obligations and now seek to come into compliance with the law.
All of these new tax procedures are for non-residents including, but not limited to, dual citizens who have not filed U.S. income tax and information returns.
Description of the New FBAR Filing Streamlined Procedure
This streamlined procedure is designed for taxpayers that present a low compliance risk.
Very important to know and understand.
All tax submissions will be reviewed, but, as discussed below, the intensity of review will vary according to the level of compliance risk presented by the submission.
For those taxpayers presenting low compliance risk, the review will be expedited and the IRS will not assert penalties or pursue follow-up actions.
Higher Risk Cases
Submissions that present higher compliance risk are not eligible for the streamlined processing procedures and will be subject to a more thorough review and possibly a full examination, which in some cases may include more than three years, in a manner similar to opting out of the Offshore Voluntary Disclosure Program.
Taxpayers utilizing this procedure will be required to file all delinquent tax returns, with appropriate related information returns for the past three years and to file delinquent FBARs (Form TD F 90-22.1) for the past six years.
Tax Payments or Payment Due
Payment for the tax and interest must be remitted along with delinquent tax returns.
Retroactive relief for failure to timely elect income deferral on certain retirement and savings plans where deferral is permitted by relevant treaty is available through this process.
The proper deferral elections with respect to such arrangements must be made with the submission.
Eligibility
This procedure is available for non-resident U.S. taxpayers who have resided outside of the U.S. since January 1, 2009 and who have not filed a U.S. tax return during the same period.
These taxpayers must present a low level of compliance risk as described below
Amended returns submitted through this program will be treated as high risk returns and subject to examination, except for those filed for the sole purpose of submitting late-filed Forms 8891 to seek relief for failure to timely elect deferral of income from certain retirement or savings plans where deferral is permitted by relevant treaty.
It should be noted that this relief is also available under the Offshore Voluntary Disclosure Program.
All tax returns submitted under this procedure must have a valid Taxpayer Identification Number (TIN).
For U.S. citizens, a TIN is a Social Security Number (SSN).
For individuals that are not eligible for an SSN, an Individual Taxpayer Identification Number (ITIN) is a valid TIN.
Compliance Risk Determination
The IRS will determine the level of compliance risk presented by the submission based on information provided on the returns filed and based on additional information provided in response to a Questionnaire required as part of the submission.
Low Risk Tolerance
Low risk will be predicated on simple returns with little or no U.S. tax due. Absent any high risk factors, if the submitted returns and application show less than $1,500 in tax due in each of the years, they will be treated as low risk and processed in a streamlined manner.
The risk level may rise if any of the following are present:
a. If any of the returns submitted through this program claim a refund;
b. If there is material economic activity in the United States;
c. If the taxpayer has not declared all of his/her income in his/her country of residence;
d. If the taxpayer is under audit or investigation by the IRS;
e. If FBAR penalties have been previously assessed against the taxpayer or if the taxpayer has previously received an FBAR warning letter;
f.. If the taxpayer has a financial interest or authority over a financial account(s) located outside his/her country of residence;
g. If the taxpayer has a financial interest in an entity or entities located outside his/her country of residence;
h. If there is U.S. source income; or
i.If there are indications of sophisticated tax planning or avoidance.
Taxpayers wishing to use these streamlined procedures must:
1. Submit complete and accurate delinquent tax returns, with appropriate related information returns, for the last three years for which a U.S. tax return is due.
Please note:
that all delinquent information returns being filed under this procedure should be sent to the address below with the rest of the submission.
2. Include at the top of the first page of each tax return “Streamlined” to indicate that the returns are being submitted under this procedure. This is very important to ensure that your returns get processed through these procedures.
3. Submit payment of all tax due and owing as reflected on the returns and statutory interest due and owing.
For returns determined to be high risk, failure to file and failure to pay penalties may be imposed in accordance with U.S. federal tax laws and FBAR penalties may be imposed in accordance with U.S. law.
Reasonable Cause
Reasonable cause statements may be requested during review or examination of the returns determined to be high risk. For a summary of information about federal income tax return and FBAR filing requirements and potential penalties.
Also,submit complete and accurate delinquent FBARs for the last six years for which an FBAR is due.
FBAR Instructions – FBAR Filing & Reporting – FBAR Help
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 26, 2012 | FBAR, Offshore Program, Offshore Tax Problems, Tax Help, Tax Lawyer
If you are a US citizen living in Switzerland or the surrounding area and need FBAR help, call us today.
We have a number of Switzerland FBAR clients and understand the tax issues and related tax problems that can occur.
We are comprised of Board Certified Tax Attorneys, Tax Lawyers, CPA’s and Former IRS Agents who have over 60 years with the IRS.
Tax News – February 2, 2012
“Switzerland’s oldest bank was indicted back on February 02, 2012 for conspiring with U.S. taxpayers and others to hide more than $1.2 billion in secret offshore foreign banks and financial accounts and the income they generated from the IRS.
It was the first time in history that an overseas bank was indicted by the United States for facilitating tax fraud by U.S. taxpayers.”
IRS will be paying closer attention to US taxpayers living abroad having overseas bank accounts and financial interests. Large amounts of funds have been placed beyond the reach of the FEDS and they plan to do something about that.
Since IRS received over $5.5 Billion over the last five years as a result of FBAR the IRS plans to ramp up enforcement because of the large pool of revenue sitting in the pockets of foreign banks and financial institutions. The IRS has committed over $500,000 million dollars in the next fiscal year to the areas of tax compliance, no filers and tax enforcement.
If you have nothing to hide or squirm about you can certainly file and report FBAR on your own. However, if you have anything that can make you nervous you should contact us for a free tax consult. 1-866-700-1040.
How you should report your account to the IRS.
Filers of FBAR should report their foreign accounts using the following method:
A. (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).
FBAR due dates:
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 the Internal Revenue Service of an extension to file Federal income tax returns does not extend the due date for filing an FBAR.
Taxpayers who file FBAR cannot request an extension of the FBAR due date.
If a filer does not have all the available information to file the return by June 30, they should file as complete a return as they can and amend the document when the additional or new information becomes available.
The issue of multiple owners of Foreign Accounts
We have had the same issues come up with a our Switzerland clients that bears a comment. With respect to the issue of Multiple Owners of Foreign Accounts:
In the case of co-owners, each taxpayer who makes a voluntary disclosure will be liable for the penalty on his percentage of the highest aggregate balance in the account. His/her voluntary disclosure is effective as to his tax liability only. It does not cover the other co-owners.
The IRS may examine any co-owner who does not make a voluntary disclosure. Co-owners examined by the IRS will be subject to all appropriate penalties or tax crimes.
FBAR Help, US Taxpayers living in Switzerland, Tax Attorneys, Lawyers, Former IRS, FBAR International Experts.
by Fresh Start Tax | Aug 29, 2012 | FBAR, Tax Help, Tax Lawyer
FBAR is the new beast of the Internal Revenue Service.
This reporting form has been a wake up call those taxpayers and persons required to file FBAR reports. It is critical to those needing to file back tax returns to get to work and make sure you have full tax representation before engaging the Internal Revenue Service.
Call us today to hear more about filing and amending FBAR and back tax returns. 1-866-700-1040. Speak to tax attorneys, tax lawyers and former IRS Agents. We are your FBAR tax experts and resource center for FBAR Help.
Information about FBAR
What is the FBAR?
The FBAR is not a tax return.
FBAR is a report filed with the IRS stating that the person filing has a financial interest in, or signatory authority over, financial accounts in a foreign country with an aggregate value exceeding $10,000 at any time during the taxable year, remember that is a aggregate value.
As part of the FBAR reporting requirement, persons or individuals are instructed to indicate on their Form 1040, Schedule B, Part III whether the individual has an interest in a financial account in a foreign country by checking “Yes or “No” in the appropriate box.
The Schedule B will then direct the taxpayer ( individuals ) to the FBAR, which is used to report a financial interest in or authority over bank accounts in a foreign country.Call us if you are not sure about the foreign country application.
The deadline for filing an FBAR for each calendar year is on or before June 30th the following year, no later dates are given.
The FBAR is not attached to the taxpayer’s individual income tax return.
It is therefore not subject to the stringent disclosure restrictions of Internal Revenue Code and the information contained in the FBAR can be shared with other Federal, State and government agencies, other local agencies and authorities.
The instructions to the FBAR explain how tax compliance with the federal statute is accomplished and sets forth the details and the required information and those person(s) obligated to comply with the FBAR reporting requirements as prescribed under the code.
How to amend your FBAR.
Taxpayers or individuals who have previously filed a FBAR form can amend a previously filed FBAR by doing the following:
1. Checking the Amended box in the upper right-hand corner of the first page of the form,
2. Making the needed additions or corrections,
3. Stapling it to a copy of the original FBAR,
4. Attaching a statement explaining the additions or corrections.
Call us today to speak directly to tax attorneys, tax lawyers and former IRS agents who are tax experts in FBAR and all other IRS matters.
Call at 1-866-700-1040. Free tax consults.
by Fresh Start Tax | Aug 27, 2012 | FBAR, Tax Lawyer
With FBAR becoming the latest trend in IRS enforcement many taxpayers were not even aware of FBAR Filing or Due Dates requirements. The IRS is making FBAR a major project because it is yielding Billions of dollars into the Fed Revenue.
It is first important to know who is responsible to file a FBAR Report.
FBAR responsibility.
Any United States person who has a financial interest in or signature authority or other authority over any financial account in a foreign country, if the aggregate value of these accounts exceeds $10,000 at any time during the calendar year.
It is important to understand that the IRS is currently running matching programs with overseas financial institutions tracing the signatures to US persons to Foreign bank accounts.
Do not forget or ignore the deadline-June 30 FBAR due date.
Form TD F 90-22.1 is a reporting document, not a tax form. That means there is no timely delivered provision. You can’t just have the envelope postmarked by June 30. The Treasury expects to have your Form TD F 90-22.1 in hand on June 30.
The FBAR must be received by the Department of the Treasury on or before June 30th of the year immediately following the calendar year being reported. The June 30th filing date may not be extended.
The IRS has just received $500 million in additional Congressional money and a sizable portion of those funds will be dedicated to running unreported FBAR filers down.
If you are in compliance, absolutely no need to worry.
If you are not sure whether you need to file the FBAR report or just want to have questions answered call us today for a no cost professional tax consult.
You can speak directly to a tax attorney or lawyer. 1-866-700-1040.
All consultations are free.
Remember, if you are in compliance you will never have anything to fear.
