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What are IRS Form 5471 penalty triggers?

Obviously, not filing a Form 5471 at all when required to do so can trigger a Form 5471 penalty. But also, any Form 5471 that is filed but that the IRS considers not “substantially complete" may result in Form 5471 penalties. In this article we will discuss what types of mistakes on a Form 5471 could lead to "substantially incomplete" penalties and what you can do to protect yourself from an IRS international audit team that admits it is hyper-aggressive when it comes to assessing Form 5471 penalties.

What Tax Reform Means to Foreign Tax Credit Rules

The Tax Cuts and Jobs Act of 2017 (TCJA) made many changes to how the U.S. taxes earnings or dividends from overseas. One of the areas impacted was foreign tax credits, which changes how taxpayers in the U.S. calculate and pay taxes on certain foreign income. Like many other parts of tax law, this can be complicated, so we’ve broken things down to explain what these changes could mean to you, whether you’re a U.S. expatriate, a corporation, or you receive income from overseas.

Does your child need to file an FBAR?

The Report of Foreign Bank accounts, also known as the FBAR was a tool invented by congress in 1970 to make it difficult for criminal masterminds around the world to use the international banking system to facilitate their criminal mastermind plans. And because of that, any US person regardless of age or mental abilities must file an FBAR should their foreign bank accounts exceed $10,000 in the aggregate. Again, believe it or not this requirement extends to someone who is disabled or is a child - even a baby. Read more to find out why

The IRSMedic MasterGuide to 2019 Federal Tax Table, Rates, and Brackets

Everyone needs to pay tax of one kind or another, so we’ve created a comprehensive guide to most of the ways the IRS and your state will charge taxes to you. From federal tax brackets and standard deductions to corporate, estate, and gift taxes, we’ll share the latest information from the IRS and state agencies on what you’ll need to pay.

The IRS is improperly and automatically assessing $10,000 Form 3520-A penalties - what to do now

The IRS has assessed many of our clients and others taxpayers around the globe who might have even correctly filed Form 3520-A and Form 3520 with substantial penalties - often $10,000. What gives? What can be done about this? In this article we will explain many situations in which a Form 3520-A is required so that you can have a good idea if the IRS's penalty assessments are something you should push back on.

Here’s the best way to deal with certified mail from the IRS

Chances are, you weren’t home when the post office attempted to deliver a certified or letter from the IRS. Chances are, a pink slip was left for you in your mailbox. You might be holding that pink slip in your hand right now. It might be a little sweaty. You might be wondering — Is this bad? Is this good? Is this no big deal? You might question - Am I going to be arrested? Should I pick up the letter? What happens if I do? What happens if I don’t? You probably are very concerned - so read on as we answer as many great questions we can.

What the difference between tax deductions and tax credits and how do they work?

The primary tools the tax code uses to encourage taxpayers to take the actions that Congress wishes are tax deductions and tax credits. So what’s the difference? And which one is better? In this article we talk about the differences between the two and how they can work together to sometimes lower our taxes, and sometimes not.

Business Expenses, Tax Write Off, and Deductions Guide

The owners of businesses must pay various taxes on the profits that their business generates. If your business is a sole-proprietorship, partnership, LLC, or S Corporation, those profits “flow through” to your personal tax return, which is where you will pay any taxes that are owned. C corporations are taxed slightly differently, and pay corporation tax on any profits.

Our guide to IRS Filings for the deceased

Death and taxes are two of the great certainties of life, and if you need help filing taxes for a deceased friend, relative, or colleague, we’ll help you understand what you need to do. This is likely to be an emotionally fraught and difficult time, so let’s keep things simple and straightforward.

Tax Reform: What is the Tax Cuts and Jobs Act and What it Means to Your Business

The Tax Cuts and Jobs Act (TCJA) is a major piece of legislation voted into law as a tax reform in 2017. The changes introduced by the TCJA affect many aspects of how individuals and businesses report on, file, and pay federal income taxes from 2018 and onward. In this guide, we’ll explore the specific changes that businesses need to make so stay compliant with federal legislation and IRS guidelines.

Tax return preparation, accounting, and bookkeeping services for US expats who value their security and piece of mind

Are you being fitted out with a tax time bomb? This is a question you must ask yourself if are a US person who lives overseas. What we've learned about the tax industry the past ten years is sobering. Whether you are retired overseas, working abroad, or have business opportunities around the world, this is the information you need to know about filing your US taxes so that you can breathe easier this tax season --- and well beyond.

501(c)(3) Non-Profit Compliance — Understanding IRS Forms 990, 990-EZ, and 990-N

All non-profit, tax-exempt organizations are required to file specific forms with the Internal Revenue Service (IRS) every year. These forms are known as 990, 990-EZ, and 990-N. You need to file them to make sure your non-profit remains compliant with IRS rules — this means you can maintain your 501(c)(3) tax exempt status.

What is IRS Form 5472? Has tax reform changed it?

IRS Form 5472 is the information return of a 25% Foreign-owned U.S. Corporation or a Foreign Corporation Engaged a U.S. Trade of Business. The form is both difficult to file and consequential if not done correctly. The IRS has kept up its enforcement campaign and additionally, the Tax Cuts and Jobs Act of 2017 (TCJA) made some rather significant changes to both the penalties and who is required to file a Form 5472. In this article, we will discuss what hasn’t changed, and what we consider the most important things that have changed.

IRS Revenue Officers: Nine Surprising Things To Know

Dealing with an IRS Revenue Officer can be incredibly intimidating. Especially after the first time one stops by your house or business, completely unannounced. Your heart may be racing -- as you wonder what is going on, and what exactly the IRS can and will do to you. But your anxiety may be misplaced. In this article we dispel the myths that surround Revenue Officers and we give away some keys to using this knowledge for your advantage.

Is your foreign retirement or pension plan taxable? Is it reportable?

Maybe --- if your foreign retirement plan is located in a tax treaty country like Germany, Canada (RRSP & RRIF), the Netherlands, UK, or Belgium, your foreign retirement plan may not be taxable until distribution (although there are likely reporting requirements). But if your foreign retirement plan is not in one of these countries --- read on.

What is GILTI? Six Global Intangible Low-Taxed Income debunked

GILTI was created in Section 951A of the US tax code by the 2017 Tax Cuts and Jobs Act, aka, Tax Reform. GILTI involves incredibly complicated calculations and huge additional compliance burdens starting for tax year 2018, and for certain types of shareholders in foreign corporations, can dramatically increase taxes. In this article, we debunk six myths surrounding GILTI, so you can lower your tax bill, or the tax bill of your clients'.

How to avoid or lower GILTI - Global Intangible Low Tax Income

The new GILTI tax regime is quite a complicated mess. US shareholders of foreign corporations could be in for a very nasty surprise as GILTI really made a mess of things. In this article we will discuss six possible way to eliminate or reduce GILTI tax surprises.

Help for Common Reporting Standards, FATCA & the OECD

Intergovernmental cooperation on tax reporting has created many complications for not just US persons around the world, but also shareholders and businesses that have nothing to do with the US. In particular, the Foreign Account Tax Compliance Act (FATCA) imposes an obligation on non-US banks and entities to comply with FATCA or risk significant penalties including the withholding of some funds transferred from U.S. sources to their bank accounts. In this article we will discuss the difficulties of filling these FATCA-related forms and what to do if you are still confused.

Why accounting and financial analysis should never scare you

If you are confused when you review the books of your company or a company you are thinking of investing in, consider: perhaps someone wants you to be confused. That's the first lesson of accounting and financial analysis -- confusion can be used as weapon to get you uninterested in something you really should be interested in. In this article, I will share four other key insights that hopefully will make the financial statements, that is, Balance Sheets, Profit & Loss Statements, Statement of Cash Flows, make a lot more sense to you.

Frequently asked questions about the US tax consequences of holding a US Green Card — and surrendering one

The US is the world’s largest economy by far. And currently, the economy of the US is outperforming nearly every major country. So for many around the world looking to get to the next level, they look at being in the US as essential to their growth.

Do you HAVE to make a streamlined disclosure to the IRS? What happens if you don't?

The IRS rules by fear and intimidation. Because of this, tens of thousands of US expatriates who learned they were in non-compliance and took the steps to rectify the situation. However, there are countless US expats who would love to be in tax compliance, but simply can’t afford the cost of hiring a firm like ours to help them submit their Streamlined “Foreign” Submission. Once such person is our latest podcast guest, "Julio." Julio has decided to definitely NOT be in compliance. His reasons are well-known to many US expats, perhaps not so well-known to Congress.

IRS tax relief programs 2018: Answers to the most common questions

If you are looking for some sort of IRS tax amnesty, there are changes and new proposed changes to the law to consider. With Tax Reform passed in 2017, and a new IRS Tax Relief Act (The Taxpayer First Act of 2018) being proposed, now more than ever it is essential if that you understand how IRS tax settlements actually work. In this article we will review the various IRS initiatives, answer some of the very basic and more advanced questions about how to deal with back taxes, penalties and interest, and the issues that arise from owing the IRS money or larger fears.

What Federal Tax Credits are available? Here's the definitive list of what's old and new.

Tax Reform was poised to eliminate many Federal Tax Credits and create new ones. And now that the smoke has cleared, we are able to see which tax credits survived, and which ones have been modified, and which ones have been added and will be available for tax years 2018 and going forward.

Tax audit red flags: separating fact from fiction

It is that time of the year again, when the early tax filing season is upon us and interest not he IRS is at a yearly high. In response, you will see article published claiming to give you the “secret sauce” on how to avoid an IRS tax audit, by warning you of “red flags.” There articles are all fine, I suppose, if this was 2008. However, the IRS has changed drastically since then. In this article, we will discuss what the real audit red flags are, and what is just sort of things are outdated.

What is IRS Subpart F? How has Tax Reform changed it?

When the IRS introduced Subpart F, it completely changed the the rules of international tax planning. Things have never been the same. Yet Congress was not done. The Tax Cuts and Jobs act of 2017, aka Tax Reform, change Subpart F and not for the best. So what are the Subpart F rules? Why are they so awful? What can be done to avoid Subpart F? This article answers these questions.

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