Report Qualifying Foreign Bank Accounts; the IRS Is Closing In
If you have money in a bank account located in a foreign country, you are required to disclose the account and its balance to the IRS every year by June 15. This law has been on the books since 1970, but what has changed is that now the government can much more easily track transgressors.
Why You Need to Seek Amnesty Immediately
In 2010 Congress enacted the Foreign Account Tax Compliance Act (FATCA) which pressured foreign countries to require their banks to turn over lists of all U.S. account holders. It took about five years for many foreign banks to put systems in place to completely, but now they are in a position to turn over account holders living in the United States. Fortunately, there is an amnesty program called the Offshore Voluntary Disclosure Initiative (OVDI) that minimize penalties if you voluntarily report accounts from past years, albeit late, but to take advantage of these, you must act before the IRS comes looking for you. The window of opportunity is quickly closing.
Taxpayers who fail to report foreign bank accounts to the IRS can face steep penalties and even felony tax evasion charges. In some cases clients have reported penalties that far exceed account balances. The penalty can be $100,000 per year or 50% of the highest account balance for every year.
When you Need Legal Counsel for FBAR Violation
The IRS will want to show you acted willfully, and can do this by simply showing you checked the box on Schedule B of your tax return indicating no interest in a foreign account. Our professionals may be able to help you to abate or avoid penalties, it is important to speak with a qualified offshore tax attorney to develop the right plan for you, as early as possible. Ayar Law prides can help you to navigate the confusing and high-risk waters of OVDI. Don’t waste time. Make the call now.
Read More about FBAR and OVDP
To learn more about the OVDI and penalties for non-reporting, see What is OVDI
- How the OVDP Works With Passive Foreign Investment Companies (PFIC)
- Foreign Real Estate and Offshore Disclosure Landmines
- 2015 OVDP: Where We Stand
- Willful on Non-Willful? What Happens Next in the 2015 SFCP or OVDP
- Do I Need OVDP?
- Where Did All the Quiet Disclosures Go?
- Streamlined OVDP for Canadians
- All about the 2014 OVDI program changes
- 2014 Streamlined Compliance Procedures: Taxpayers living in the U.S.
- 2014 Streamlined OVDP program: Taxpayers living abroad