Foreign Bank Account Representation
It is legal for U.S. taxpayers (including green-card holders) to have foreign bank accounts. There are many legal tax saving reasons for a U.S. taxpayer to maintain a foreign bank account, including, but not limited to, for confidentiality purposes, investment purposes, requirements of a foreign government, and asset protection.
However, the U.S. has complicated reporting requirements for offshore bank accounts, including but not limited to: foreign bank accounts, online gambling accounts, passive foreign investment companies, and investments in foreign mutual funds, foreign trusts, and other areas.
For years, numerous taxpayers holding offshore or foreign bank accounts or having offshore income have not disclosed the existence of these accounts or claimed income from them on their income tax returns. These taxpayers thought that the U.S. government could not obtain information about their accounts.
THINGS HAVE CHANGED
The United States is NOW enforcing a global taxation strategy by efforts such as Foreign Account Transaction Compliance Act (FATCA);
At, Moskowitz LLP, we have a comprehensive understanding of the laws and policies that affect people with money, assets in business and investments in the United States and overseas. We have helped hundreds of offshore account holders, find out how we can help you:
FBAR - Offshore Account Resource Information
The U.S. government’s strategy for enforcing offshore bank account reporting and the taxation of worldwide income & assets has been to go after the banks who then turnover names and information in the hopes of negotiating for lesser criminal charges and fines.
i. Banks : HSBC, UBS, Credit Suisse, Wegelin, Bank Hapaolim, Bank Leumi, Bank of Isreal, Bank Sarasin, Woori, Mizrahi-Tefahot Bank
Note: FAQ 21 of the OVDP's frequently asked questions states that the IRS may announce that groups of taxpayers "that have or had accounts at specific financial institutions will be ineligible [for the OVDP] due to U.S. government actions in connection with the specific financial institution." Presumably, those taxpayers at banks not blocked for participation and who otherwise qualify may still apply for entry to the program.
ii. Promoters: Renzo Gadola, Martin Lack, Stephan Fellman, Otto Huppi, Christof Reist, Hans Thomann, Beda Singerberger, Josef Beck,
Not only have the banks turned over names of their employees for investigation and identification of offshore account holders, but the DOJ is independently following its own source of leads - prior amnesty applications, data mined from summonses, and criminal tax prosecutions.
When individuals such as the above are identified, part of any plea deal requires full disclosure of all information. Therefore, these bankers end up [going] through client by client, colleague by colleague,” said Mark Daly, a trial attorney with the U.S. Justice Department’s tax division. “It has been extremely helpful.”
Avoid Criminal Prosecution
- What is a criminal prosecution
- Criminal Investigations
- Civil Investigations that go Criminal
- Criminal Penalties
- Statute of Limitations
Offshore Voluntary Disclosure Program (OVDP)
The offshore voluntary disclosure programs administered by the IRS have resulted in over thirty thousand US taxpayers coming forward and in exchange for lower penalties and no criminal prosecution. These programs have revealed banks, bankers, lawyers and associated parties who are then prosecuted to the full extent of the law.
Voluntary Disclosure for Offshore Bank Accounts, failure to report FBAR
Civil Tax & FBAR Penalties
- Civil fraud
- Unlimited statute of limitations and the civil fraud penalty
- Willfulness penalty
- Non-willful penalty
- Collection of Penalties
It is a top priority of the current administration in Washington, D.C. to capture the revenue believed lost to the Federal government through the use of and non-reporting of offshore accounts and other foreign financial interests and the income derived from them. The IRS has greatly increased the number of audits in this area and is hiring more auditors, collectors, and criminal investigators with expertise in international tax investigations. Legislation and enforcement policies will continue to provide even more tools to help increase the ability of the IRS to enforce these tax laws.