International Information Return Penalties 2020: IRS Filing International Information Return Penalties: The IRS International Information Return Penalties can be brutal. The Internal Revenue Service seems to have carved out a niche for aggressive enforcement of foreign accounts compliance. While the FBAR (FinCEN Form 114) and Form 8938 (FATCA) are the two most common international reporting forms, there are actually many more forms a U.S. person may have to file with the Internal Revenue Service. The…
FBAR for Expats: IRS Filing Rules & Guide for Expatriates Abroad – Board Certified Tax Law Specialist FBAR for Expats: IRS Filing Rules & Guide for Expatriates Abroad: The FBAR for Expats filing rules are complex. Expats who reside outside of the United States have the same FBAR reporting and other IRS International Reporting requirements as U.S. residents. In other words, there is no specific rule that exempts foreign residents from having to file an…
Offshore Tax Amnesty – Penalty Avoidance | IRS Offshore Tax Amnesty – Golding & Golding Offshore Tax Amnesty: There are several Offshore Tax Amnesty programs. The IRS has developed various voluntary disclosure programs for tax and international information reporting. The purpose of the programs are to help U.S. Taxpayers safely get into offshore compliance for unreported assets, accounts, and investments. Common filing requirements include reporting Foreign Bank Accounts on FBAR & FATCA reporting forms. With…
Voluntary Disclosure Preclearance Voluntary Disclosure Preclearance: The Voluntary Disclosure Preclearance Letter is now an IRS requirement under the updated IRS Voluntary Disclosure Practice. Under the previous version of the program (OVDP), preclearance was not mandatory. Fast-forward to 2020, and now the IRS preclearance letter is mandatory. Moreover, the Internal Revenue Service has developed a pre-printed form (revised Form 14457) to submit the letter. Under the prior OVDP, form 14457 was also used as part…
Unreported Foreign Income 2020: Update to IRS Reporting Rules Unreported Foreign Income: Unreported foreign income may lead to problems for U.S. persons worldwide. The IRS has significantly increased enforcement of Foreign accounts and income compliance. The U.S. tax rules follow a worldwide income model. Therefore, the U.S. taxes filers on their worldwide income. This is true of all U.S. Persons, whether they reside in the U.S. or overseas — and whether the income is…
Missed Prior Year FBAR Filing: IRS Foreign Account Amnesty 2020 (Golding & Golding) Missed Prior Year FBAR Filing: When a U.S. person missed a prior year FBAR filing, they have many IRS options to available to resolve the issue. Otherwise, the filer may become subject to offshore Penalties for FBAR violations, in addition to various other penalties. The IRS has very strict deadlines when it comes to filing the FBAR. In 2017,…
FBAR vs. 8938: Comparing IRS Offshore Account Filing Rules (Golding & Golding) FBAR vs 8938: Comparing IRS Offshore Account Filing Rules: The FBAR vs FATCA Form 8938 is (unnecessarily) complex. The IRS provides some resources, but oftentimes these instructions and publications are unclear. The FBAR is the FinCEN Form 114, and the 8938 is the FATCA Form 8938. The FBAR is filed electronically with FinCEN and is separate from a tax return. The Form 8938…
Foreign Life Insurance Taxation – Income & Proceeds Taxable? Foreign Life Insurance Taxation: The foreign life insurance taxation rules are complicated. In general a foreign life insurance policy is an important component of an investment portfolio. When a U.S. person owns a foreign life insurance policy there may be tax issues to consider. In addition, if the foreign life insurance policy has a surrender value or cash value, and/or is considered a ULIP there may…
Foreign Life Insurance Policy FBAR – How are they Reported? FBAR Insurance Policy and how to report foreign life insurance to the IRS: The IRS FBAR Insurance rules for reporting life insurance for foreign policies are very complex. The IRS requires U.S. person owners of a foreign life insurance policy to report the policy annually, on an FBAR. In recent years, the Internal Revenue Service has taken an aggressive approach to foreign accounts compliance
Eggshell Audit: IRS High Risk Examination & Criminal Exposure Eggshell Audit: IRS High Risk Examination & Criminal Exposure: With an eggshell audit, the taxpayer is at a high risk for a potential IRS willful violation, tax fraud, and even a criminal investigation by the IRS. An eggshell audit is a situation in which the Taxpayer may have incriminating evidence that the agent is not yet aware of (unless the agent is aware, and…