DOJ & IRS Taking Aggressive Positions with Undeclared Accounts in 2013
We pay close attention to DOJ & IRS enforcement actions and statements relating to undeclared accounts held at foreign banks. It appears that that certain holders of undeclared accounts may be running out of time to participate in the amnesty program. Consider the following:
1. U.S. officials have recently suggested that the UBS case is NOT necessarily a template for how the DOJ and IRS will treat individuals with undeclared accounts at other financial institutions in the future. Noting that UBS account holders: (a) received prior notice of a potential disclosure to U.S. authorities; and, (b) remained eligible for the voluntary disclosure program;
2. IRS FAQ 21 posted June 26, 2012 states, in relevant part, that “the IRS may announce that certain taxpayer groups that have or had accounts at specific financial institutions will be ineligible [to make a voluntary disclosure] due to U.S. government actions in connection with the specific financial institution;"
3. U.S. authorities are reportedly investigating the following financial institutions: Credit Suisse, HSBC, Julius Baer, Basler Kantonalbank, Zurcher Kontonalbank, Neue Zuercher Bank, Liechtensteinische Landesbank, Leumi, Hapoalim, and, Mizrahi. Wegelin just pleaded guilty.
It is reasonably foreseeable that the IRS may close the voluntary disclosure program to individuals with accounts at one or more of the banks listed above without prior notice. These individuals will likely face a civil examination and/or criminal prosecution if the U.S. government obtains their identities.
The IRS has Announced a New Offshore Voluntary Disclosure Program (1/9/2012)
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.
New Streamlined filing compliance procedures for non-resident U.S. taxpayers effective September 1, 2012.
The new streamlined filing compliance procedures for non-resident U.S. taxpayers were implemented because 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. Many of these taxpayers have recently become aware of their filing obligations and seek to come into compliance with the law. For more information CLICK HERE
Undeclared Offshore Accounts
If you have been following the offshore enforcement news on mytaxlaw.com, it is likely that you have an undeclared offshore account or other compliance issues. You may be very concerned with the prospect of facing criminal prosecution and/or significant penalties if your foreign bank discloses your account records to U.S. authorities.
We understand that these concerns can be overwhelming. Many holders of undeclared accounts describe a range of emotions including anxiety, depression, fear, and paranoia. These emotions may cloud your judgment and cause you to make irrational decisions which actually make your compliance issues worse. Account holders should make educated decisions which are not fear based decisions.
Our core belief is that the best decisions are made by the people with the most information. We strive to keep our clients and followers informed by tracking the latest news related to UBS, HSBC, Credit Suisse, Julius Baer, Bank Leumi, Deutsche Bank, and Basler Kantonalbank.
I would like to personally thank you for visiting mytaxlaw.com and ask that you kindly consider our Firm in your search for an attorney to assist you with your offshore compliance matter.
Offshore Voluntary Disclosures
Over 90 percent of our practice is dedicated to offshore compliance issues. Our attorneys handle a wide variety of cases ranging from very large complex cases to relatively small simple cases.
We have successfully represented clients in all five of the offshore voluntary disclosure programs offered by the IRS. A short history of the programs is set forth below:
2003 OVCI - The first offshore voluntary disclosure program offered by the IRS was a mere footnote on the back page of the newspaper. The program had approximately 1,500 participants nationwide. We successfully represented several clients in this program.
2004 LCCI - When the 2003 OVCI program ended, the IRS offered the LCCI program to account holders whose offshore credit card accounts were uncovered by the IRS. We successfully represented several clients in this program.
2009 OVDP - In 2008, the DOJ and the IRS successfully cracked bank secrecy with thier combined efforts against UBS. The push by the U.S. government opened up the flood gates as approximately 18,000 account holders participated in this program. We successfully represented numerous clients in this program.
2011 OVDI - When the 2009 OVDP closed and pressure against other banks ramped up, another 15,000 account holders came forward. We successfully represented numerous clients in this program.
2012 OVDP - When the 2011 OVDI program closed and the pressure expanded to eleven different banks under investigation, the IRS opened the door again. We are currently representing numerous clients in this program.
There is no substitute for experience when it comes to dealing with the IRS.
Call 305-576-4242 to speak with Teig Lawrence regarding your Offshore Account.