Fbar Foreign Bank Account Reporting On Irs Agenda-hamimelon

Business In the wake of the UBS AG fallout and IRS Offshore Settlement Initiative, the IRS continues its pursuit of tax evaders with undisclosed offshore accounts with their requests of FBAR (Foreign Bank Account Reporting) of suspected violators. What can be expected from the IRS? In 2009, a highly publicized investigation into Swiss bank UBS AG and U.S. account holders was launched by the IRS and U.S. Department of Justice against those who failed to come forward with their assets to the U.S. Government. However, the investigation did not end with UBS. To encourage taxpayers to come forward, the IRS instituted the Offshore Settlement Initiative Voluntary Disclosure Program (the Initiative) where undisclosed offshore account holders could disclose their foreign assets in exchange for reduced penalties. However the deadline to take part in the Offshore Settlement Initiative has since passed. The IRS has made it is known that offshore tax evasion will remain a top priority. So, those U.S. taxpayers with undisclosed offshore accounts that failed to meet the Offshore Settlement Initiative deadline of October 15, 2009 can expect to be contacted by the IRS. As the IRS continues its pursuit, Taxpayers may receive a Form 6564 or Information Document Request (IDR). These IDRs will focus on offshore bank accounts. In order for IRS examiners to validate a tax return they will need to secure the necessary books, papers, and other information. The Information Document Request is a formal and structured process for the IRS to request and secure information from taxpayers, including information regarding offshore bank accounts. Although less formal than a subpoena, an IDR still carries with it consequences for failure to comply and can lead to deeper inquiry and possible sanction. The IRS will focus Information Document Requests on U.S. taxpayers with offshore assets and accounts that failed to disclose these interests to the U.S. government on their Form 1040, U.S. Individual Tax Returns, and file a corresponding Form TD F 90-22.1, Foreign Bank Account Reporting ( FBAR ). If IRS agents discover that a taxpayer has not reported an interest in an offshore account or income accruing on such accounts during the course of an audit, the IRS may impose steep penalties including the greater of $100,000 or 50% of the offshore account balance for willful failure to file an FBAR for each account. These penalties, compounded with interest and fraud penalties, can essentially wipe out the taxpayers foreign assets.Additionally, taxpayers could be subject to criminal prosecution and jail time for tax evasion. The issues surrounding these IDRs are exceptionally delicate and should be met with caution. Taxpayers who have been issued an Information Document Request by the IRS are best served by calling on a tax attorney who is adept at resolving disputes with the IRS quickly. An attorney can direct the taxpayer how best to respond to an Information Document Request and will be able to plan with his attorney the best strategy for a course of action. Otherwise the Internal Revenue Service can seek considerable penalties and possible criminal prosecution against those U.S. Taxpayers believed to be hiding money in undisclosed offshore accounts About the Author: 相关的主题文章: