FBAR Tax Attorney Atlanta
Whether or not you are a bank account holder in a foreign nation, the following article will help shed light on how the IRS is now targeting individuals for new compliance measures. Are you are an American expat and haven’t filed a tax return in years? Have you been living overseas and have recently become aware of your filing obligations?
If you are a US citizen or green card holder living abroad and have years of unfiled tax returns, you are not alone. The IRS has recognized that many taxpayers overseas have not timely filed their U.S. federal income tax returns or Reports of Foreign Bank and Financial Accounts (FBARs), Form 114 (formerly TD F 90-22.1) and is offering a special procedure to get delinquent taxpayers back on track. The IRS presents a very attractive opportunity to come into compliance in a manner that avoids possible IRS enforcement action and the significant penalties that accompany it
The IRS expanded and changed the Streamlined Filing Compliance Procedures first implemented on September 1, 2012. The program now includes not only individual taxpayers who reside outside the United States but also US individual taxpayers residing in the United States.
The 2 programs are the
1. Streamlined Foreign Offshore Procedure and
2. The Streamlined Domestic Offshore Program.
Canadians Caught in the FBAR
Canadians caught by the foregoing would be snowbirds that are consistently present in the U.S. about 120 days in three consecutive years or those working in the U.S. on a visa/work permit that fall into residency rules.
The FBAR filing requirement does not take a treaty-based disclosure (IRS Form 8833) into account. Only IRS Form 8938 (‘Statement of Foreign Financial Assets”) that came out in 2011 (and attached to a U.S. tax return if there is a requirement to file that return) has in its regulations, an exemption from filing as it respects the foregoing treaty disclosure.
Other IRS information returns such as the 5471 for your interest in your Canadian corporation; IRS Form 3520/3520-A for your interests in a Canadian trust or even IRS Form 8865 for your interest in a Canadian partnership would come under their respective filing requirements. Regulations need to be examined to determine if there is a simplified filing requirement of the information return. Generally, without a successful reasonable cause defense, a minimum $10k U.S. penalty for unfiled information returns may be levied.
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FBAR Tax Attorney Atlanta