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The Five Worst Mistakes Immigrants Make with Taxes

The Five Worst Mistakes Immigrants Make with Taxes

There are almost 400,000 people who were born in a different country across Macomb, Oakland, Washtenaw, and Wayne Counties. Detroit has welcomed people from all over the world throughout its history.  People are coming to enjoy the economic opportunity that only the Motor City provides.

But the situation is not all rosy. Tax laws here are not only different from those in your home country, they are incredibly complex. If you are having issues with the law, call an FBAR tax attorney and keep reading.

Not Reporting Foreign Bank Accounts

Foreign Bank immigrant tax mistakes

This is an easy mistake to make. You may have even forgotten that you had an account back home. But not reporting a foreign bank account is a good way to earn the ire of the IRS. Not only will you be facing steep penalties, you might be hit with felony tax evasion charges.

In 2010, Congress passed the Foreign Account Tax Compliance Act, otherwise known as FATCA. This required foreign banks to turn over names of U.S. account holders. If you have an account in a different country, you should not assume that the authorities will not find it. It is better to be on the safe side.

Not Paying Taxes

Our tax structure can be confusing. No one appreciates that fact more than we do. The federal tax code is 74,608 pages long. That is more than 17 and a half times the entire length of the Game of Thrones book series.  In the face of the sheer amount of laws and their complexity, it can be tempting to just throw up your hands and not pay.

This is a mistake. The IRS has the resources it needs to claw back what they think they are owed. A wide range of options is in their arsenal, including tax liens, wage garnishments, and bank levies. Pay your taxes. If you haven’t paid your taxes, call a tax debt relief attorney as soon as possible.

Failing to Report All Income

If you work and earn money in India, Iraq, or Mexico, it makes sense that you only pay taxes in those countries (or whichever country you are from). As intuitive as that may seem, the IRS disagrees. It is taxed at the source, but you still need to report it. Otherwise, you might run into some trouble.

Not Claiming Tax Treaty Benefits

The US has tax treaties with a number of different countries. If you earned income in one of these countries, you may be eligible to pay reduced taxes, or not pay taxes at all. It is a good idea to look at some of the rules before you go forward without paying taxes.

Not Fighting an Audit

Not Fighting Audit
Even if you are super careful, even if you follow every single rule to the letter, even if you have no bad intentions, you may still face a tax audit. That can be very scary, and we get that. But you should know that the IRS is not always right. They make mistakes, just like everyone else does.

When they do, you can fight back. Legally, you have the option to pursue IRS audit appeals. In some cases, you can even file a lawsuit. An attorney can explain your options to you, and can give you advice on your next steps.

Ayar Law has the resources you need if you are in trouble with the IRS. We have already helped many people across the country with their tax problems. Contact us today.

Venar Ayar, Esq.

Venar Ayar, Esq.

Attorney-at-Law, Master of Laws in Taxation
Principal and founder, Ayar Law

Venar is an award-winning tax attorney ranked as a Top Lawyer in the field of Tax Law. Mr. Ayar has a Master of Laws in Taxation – the highest degree available in tax, held by only a small number of the country’s attorneys.