Home » Blog » Accountants in Miami » Accountant Urge Full Disclosure of Foreign Bank Accounts to IRS?
Encontrar un buen Contador, contadores, contador, cpa, certified public accountants, certified public accountant, accountancy service, ahca, contador, ahca consulting, tax , accounting, accountants, accountant, accountants in miami

Accountant Urge Full Disclosure of Foreign Bank Accounts to IRS?

Accountant urge full disclosure of foreign bank accounts due to new IRS incentives to disclose

Miami Accountant Gustavo A. Viera states that as part of the IRS’s continuing crusade against offshore tax cheats, especially among the super-rich, the Internal Revenue Service today announced new incentives for the owners and inheritors of once-secret foreign bank accounts to disclose them.

Accountant Note Reporting Requirements

U.S. citizens, resident aliens and certain nonresident aliens are required to report worldwide income from all sources including foreign accounts and pay taxes on income from those accounts at their individual rates, according to Viera Accountant.

Failure to report the existence of offshore accounts or pay taxes on these accounts can lead to civil and even criminal penalties. There is an increasing risk of getting caught, too. Since 2009 government officials have investigated a slew of foreign banks and ordered them to turn over names of U.S. clients, many of whom have long kept these accounts secret and not paid taxes on them.  Meanwhile, the government is now getting even more offshore records and leads – not only about legendary secret Swiss bank accounts, but those in banks in Israel, Hong Kong, India and the Caribbean according to Viera Accountant.

In addition a new regime, under the Foreign Account Tax Compliance Act (FATCA), which goes into effect on July 1, requires foreign financial institutions to report to the IRS overseas accounts held by U.S. persons.

In most cases taxpayers, or their Accountant, with foreign accounts need to fill out and attach Schedule B to their tax returns. Part III of Schedule B asks about the existence of foreign accounts and usually requires U.S. citizens to report the country in which each account is located. Certain taxpayers may also have to fill out and attach to their return Form 8938, Statement of Foreign Financial Assets, if the aggregate value of those assets exceeds certain thresholds that vary depending on filing status and whether the taxpayer lives abroad. Additional filing requirements apply to those with foreign trusts.

Separately, foreign bank and other financial accounts must be disclosed on a Foreign Bank Account Report, known as the FBAR, if they total more than $10,000. This requirement applies not only to owners, but also to inheritors and anyone with “signatory authority” over the account. Even an adult child with power of attorney on her elderly parent’s foreign accounts must file her own FBAR, even if she never took any action on the account, according to an Internal Revenue Service manual.

Accountant States Penalties & Jail Time are Stiff

Penalties for not taking these steps are substantial. For the Form 8938, the civil penalty alone may be up to $10,000 for failure to disclose and an additional $10,000 for each 30 days of non-filing after IRS notice of a failure to disclose, for a potential maximum penalty of $60,000. For the FBAR, the civil penalty may be up to $10,000, if the failure to file is not willful; if willful, however, the penalty is up to the greater of $100,000 or 50% of account balances.

Currently, the OVDP offers amnesty from criminal prosecution and reduced civil penalties as an incentive to disclose previously-secret accounts – 27.5% of the highest balance in the account during the past eight years, rather than the usual 50%. According to Congress’ Government Accountability Office, between 2007 and 2010, the number of taxpayers reporting foreign accounts nearly doubled, to 516,000.

They will have further inducement to come forward under the OVDP changes announced today. Most notably, it increases the offshore penalty percentage (from 27.5% to 50%) if, before the taxpayer starts the OVDP process, it becomes public that a financial institution where the taxpayer holds an account or another party facilitating the taxpayer’s offshore arrangement is under investigation by the IRS or Department of Justice.

While OVDP is geared for people who must be concerned about the possibility of criminal penalties, the IRS has a separate set of streamlined procedures that, as of today, many other taxpayers can now use. Those who opt for streamlined disclosure do not get criminal protection. And they must be able to show that their failure to disclose the account was not “willful” – a hazy term that may turn out to be difficult to apply.

The changes announced today make it possible for many more people to take advantage of the streamlined procedures. While previously they were available only to non-residents who had not filed their taxes, now certain U.S. taxpayers residing in the United States can also participate, though they must pay a penalty that doesn’t apply to U.S. taxpayers residing outside the United States: 5% of the foreign financial assets that weren’t reported (since the IRS assumes that people living in the country should know better).

Here’s where things could get interesting: Anyone who takes advantage of the streamlined procedures must certify that previous failures to disclose the account were not willful. To do that, they must attach a statement to their tax return describing the facts and circumstances so the IRS can evaluate whether they are being above board.

Robopragma pkv Bandarqq Robopragma Robopragma upgrade akun pro PKV Games http://s3.ascp.org/index.html Parlay pkv games situs parlay bola terpercaya Sbotop dominoqq
pkv games
bandarqq pkv games mix parlay pkv Pkv Games