IRS promises four new international audit campaigns
We've been reporting on the ramp-up in the amount of International Practice Units the IRS has been developing to assist auditors in assessing large additional tax bills and assessments. We've also commented on how the IRS's bark is sometimes worse than its bite. But recent news leads us to believe a long winter for those with overseas accounts and income is going to start.
2017 Tax reform updates: The winners and losers so far
H.R. 1, "the Tax Cuts and Jobs Act" which is the first draft of the 2017 Tax Reform bill fulfills some of the promises made by Republicans. However, it has got some weak points. In this article I will analyze the major benefits and the drawbacks of the latest tax reform package.
Common tax myths about Americans living overseas
We're once again joined by Keith Redmond - American Overseas Global Advocate, to speak on common myths about Americans living overseas.
China is sharing confidential financial information with the US. How to protect yourself from bad advice
For Chinese-Americans with assets in China and elsewhere who have not disclosed their worldwide income and assets properly, the IRS might be able to target them easily very soon. And, the consequences could be very dire.
Why I stopped worrying about my tax practice and learned to love Trump’s tax plan
With the news that the Senate will allow a ratification of tax reform on a simple majority vote, there exists a larger than 50% chance that tax reform will pass this year. Loaded with stress and anxiety? I suppose I should be suffering these ailments as well, but I am not. I suppose I should join many large players are who actively fighting against reform because they fear a simplified tax code will reduce the need for their services. But I won’t. Why?
Why you should NOT wait until tax reform to settle with the IRS
We have many people reach out to us regarding their tax issues. Lately, the most common question we get is, "Should I wait until tax reform passes before I handle my tax problem?" The short answer is "No." But why?
New IRS streamlined installment agreement program: Can it help you?
While we don't like the IRS, we do like the IRS Streamlined Installment Agreements for those who owe back taxes. Why? Because full financial statements (with supporting documentation) are not needed, which means we don’t have to charge a client nearly as much in order to get into a repayment plan that they can afford. The downside? Unfortunately, there's a few that we can think of. But first -- the upside.
2017 Tax Reform: Why we need Territorial Taxation for Individuals
It’s time to petition Congress to end Citizenship Based Taxation by supporting Territorial Taxation for Individuals (TTFI). We were joined today by Keith Redmond, American Overseas Global Advocate. He brought us up to speed on where things currently stand, and what we can do to support the fight.
The Bedrosian FBAR case: Another Victory
A recent case in the Third Circuit, Arthur Bedrosian v. United States of America, resulted in a huge win for the taxpayer. Yet it was another loss, after Pomerantz and Hom, for the government, which the court ruled failed to meet the burden for proving a willful FBAR penalty violation. After the entire findings of fact and conclusions of law follows this analysis.
OVDP & offshore penalties CLE: Join me, Robert Hanson & Dennis Brager on November 1st.
Last year, Robert, Dennis, and I presented a CLE on "Appealing IRS Penalty Abatement Denials: Offshore Disclosure Penalties, OVDP Denials and Appeals." There have been a lot of developments since then --- both in the court room and internally at the IRS. But one thing hasn't changed: the IRS is incredibly aggressive, yet inconsistent, about assessing international penalties. We invite any tax practitioners concerned about keeping their international clientele safe from this real and present danger to join us.
FATCA is a blinding disaster that the 6th Circuit can't see. So let's help them.
**** UPDATE: We learned the the Sixth Circuit denied an En Banc Hearing September 27, 2017. So it's on the the Supreme Court. **** The US 6th Circuit of Appeals dismissed the Rand Paul/Mark Crawford Foreign Account Tax Compliance Act (FATCA) lawsuit for a lack of standing, claiming that it couldn't see the damage FATCA has caused. Yet we know the damaged caused is so obvious to everyone --- even its supporters --- that there has to be a logical way to explain the 6th Circuit's massive failure to see what everyone knows. One theory is that the FATCA disaster is so massive, like a atomic blast, it temporarily blinds certain observers, making them unable to make use of their faculties. In this article, we will help anyone so confused to make sense of FATCA. We will focus on just one example, just one victim of FATCA, Donna-Lane Nelson. Ms. Nelson is a plaintiff in the FATCA lawsuit. She tells us her story in detail and talks about how FATCA robs opportunity from regular Americans every day.
IRS Superannuation treatment update
A couple of weeks ago, we spoke about US tax treatment of Australian Superannuation funds. We received some feedback about how these funds should be treated, and what IRS reporting forms are required. In this video, we reply to the feedback we received.
Hedge Fund taxation - why state tax hikes are a bad idea if prosperity is your goal
Anthony and I had the opportunity to speak to Bruce McGuire, the Founder and President of the CT Hedge Fund Association, and also the managing partner at Global Alpha Research. He helped us to understand just how much Hedge Fund investors benefit Connecticut's economy.
Should I file a Streamlined Submission or use the Full OVDP?
Too many people, realizing they have a problem with issing FBARs, Form 8938 and income overseas panic. They go to irs.gov and become convinced that they need to enter into the full Offshore Voluntary Disclosure Program (OVDP) --- or else. The problem is that once you go full OVDP, you can't go back, even if the Streamlined program was the most appropriate choice. In this article we will add some perspective on who should use the full OVDP and those who should use the Streamlined program.
IRS Updates for those affected by Hurricanes
Hurricane Harvey wreaked havoc on Texas. Now, Hurricane Irma is threatening Florida. The IRS is offering assistance to those in the affected areas.
Australian Superannuation US tax treatment: Separating fact from (wishful) fiction
US persons are taxed on their worldwide income, even if there is income generated in a tax-deferred account in another country. This is especially a problem for US Expats in Australia, and for Australian immigrants to the US who still have assets that earn income overseas. We recently came across an article claiming that the entire US tax industry is treating all Australian Superannuation funds incorrectly. And the writer of the article claims he has the best solution. No doubt the entire US tax treatment of Australian Superannuation Funds held by US persons is complicated and can be onerous. However, some cases are actually pretty simple. In this article we analyze the claims made and help clarify the issues so that the US holder of an Australian Superannuation can be empowered to make up their own minds if they have a big issue or not.
What is the Carried Interest Loophole?
There is actually no such thing as the Carried-Interest Loophole. Try as one might, it is impossible to find a special tax rule that allows Hedge Funds and Hedge Fund managers to take advantage of the US tax code in a way that no other investor can. In this article we will explain the rules, and why any attempts at closing the non-existent loophole would necessitate the removal of long terms capital gains treatment --- something that is completely infeasible.
Passport Revocation Update from the Taxpayer Advocate
Thanks to our friend and expat advocate Keith Redmond who set up this up, Attorney Anthony Parent had the pleasure of a conference call with the Taxpayer Advocate to get updates on the Passport Revocation and Denial Law. They had some interesting insight into the situation. As a matter of fact, we got more information from them than we've gotten from the IRS.
Can you compromise an IRS Offer in Compromise?
What do you do about an Offer in Compromise you can't afford? Do you allow the Offer in Compromise to default, go back into collections and try something else? Or, can you renegotiate the Offer in Compromise to what you can now afford? That is, can you compromise your Offer in Compromise?
Canada collects $120,000 in Form 5471 penalties for the IRS
Today we want to talk about the Dewees v US Claim for refund suit against the US government. It seems that when someone find out they have FBAR reporting requirements and decide to "come clean"...it's not always enough. If not done correctly, that decision can open a can of worms.
The incredible things we’ve learned as OVDP lawyers
Our work as Offshore Voluntary Disclosure Program (OVDP) attorneys is rewarding. Working with our dynamic clients, getting to know them, their families, while doing our best to mitigate the risk and damage the IRS intend to cause --- we feel great because the work we do is incredibly consequential.
What to do with Offshore Voluntary Disclosure Program regrets
If you were a reasonable person, and weren’t an expert on IRS criminal and civil process, but rather, relied upon what the IRS claimed on their website, you would likely be convinced, that no matter what your criminal intent was, you must enter in Offshore Voluntary Disclosure Program (OVDP) or else. This article is about what to do if you realized you were scared into something you should not have done.
Can you amend FBARs?
Yes. It is possible to amend FBAR forms. But should you? Or should you get an expert to file it for you?
How Federal Tax Amnesty Programs work
IRS problems can sneak up on anyone. But not everyone's circumstances are the same. When solving a tax problem, the best option for your neighbor might not be the best option for you. In this article, we are going to go over some of the tights spots Americans get themselves into each year and the best federal tax amnesty programs for each situation.
IRS targets Streamlined Submissions with Audits
For years the IRS has been saying that Streamlined Submissions for offshore accounts would be ripe fodder for audits. But, we never saw any evidence of them doing so. Until...