FATCA- Using a non US passport to open your foreign bank accounts will not work!

FATCA requires foreign banks to conduct due diligence to see if there are US persons with foreign bank accounts.  The fact you did not give a foreign bank your US passport still does not mean they might not report your foreign bank, financial and other accounts to the US and IRS.

FATCA was enacted to expose those US citizens and green card holders who are trying various tricks such as dual passports, etc. to avoid reporting and paying taxes on their foreign financial accounts.

Under the FATCA law  in order to stay in good graces of the IRS, the foreign banks  must put into place procedures to weed out account holders who are Americans and US green card holders even though the passport they opened the account with said otherwise. These are the questions you need to ask yourself before you take the HUGH risk of not reporting those accounts on form TDF 90-22.1 (FBAR form). 

• Are there any US address associates with your account?
• Are there any US phone numbers with your account?
• Is your birthplace listed as somewhere in the US?
• Have you made more than one wire in or out form the US?
• Any other item that may make the bank suspicious you are a US person.

If any of the questions above you answered yes, there is a significant chance the your bank will disclose your account to the IRS. If you are detected by the IRS before you made an Offshore Voluntary Disclosure, you must expect the harshest penalties both criminal and civil. The IRS has invested everything in this program. It operates by fear and intimidation. It has the law, the political clout (in Congress, no one is standing up for international community).

This form (TDF 90-22.1) for 2012 is due  on 6/30/13 (must be received by IRS as of that date).   It cannot be extended. The statute of limitations for prosecution or huge monetary penalty imposition for not filing this form goes back for 6 years.

Bank accounts in the Central and South America, the Mideast and the Far East — Panama, Ecuador, Argentina, Venezuela, Taiwan, South Korean, Thailand, Dubai, Malaysia, Singapore, Hong Kong, China, India — these are the targets of FATCA.  The US is signing up other countries daily to participate in the program. Remember, the US already had information sharing agreements with European banks. FATCA was put in place to find out  US account holders everywhere in the world.

 

US Expats in Mexico and Denmark on 1/1/13 Will Have Their Financial and Tax Information Disclosed to US

The United States has entered into its second and thir  bilateral exchange of financial and tax information agreements regarding the implementation of FATCA with  Mexico and Denmark.  This new agreements target non-compliant U.S. taxpayers owning foreign accounts.The agreemenst will be  become  on January 1, 2013.

The reciprocal nature of the United States' agreement with  Mexico and Denmark will allow the countries to use the automatic exchange of information to discover non-compliant taxpayers. The good old days of "what happens in Mexico, stays in Mexico" are almost over.

Now is the time to start reporting to the IRS all of your previously unreported Mexican and Denmark business and financial activities before these new programs are geared up.  If in the future the IRS discovers you have unreported income or assets in Mexico or Denmark, and you have not been filing the proper reporting forms with your tax return, it most certainly will impose high monetary penalties and will most likely also seek criminal penalties. The average prison sentence for tax evasion usually runs 3-4 years.  

We can help you catch up. Email us at ddnelson@gmail.com or visit our website at www.TaxMeLess.com  

IRS releases new FAQs for Offshore Voluntary Disclosure Program, announces other rules

The IRS just revised and released new guidance on its 2012 Offshore Voluntary Disclosure Program Initiative.  The revised guidance is located  HERE.     Read this article from the Journal of Accountancy  which explains  in general some of the revised guidelines for entering the program and another new program starting 9/1/12 for those who owe little taxes, live abroad, and did not know about filing US tax returns or Foreign Financial Account Reporting Forms (TDF 90-22.1)

We have advised and/or represented over one hundred clients in connection with these programs with great success.

IRS Announces 2011 Voluntary Offshore Disclosure Program (new program)

The IRS TODAY announced a New 2011 Voluntary Offshore Disclosure Program which will be available through August 31, 2011. It gives taxpayers who are hiding assets abroad, or not disclosing those assets on their tax returns as required by tax law , or those who failed to  file the required forms disclosing their assets abroad a second chance to come out of the closet. The new program will give participants  reduced penalties from those they would have paid if they did not enter the program. The new program's penalties however are in many circumstances higher than those charged participants in the 2009 Offshore Voluntary Disclosure Program which ended 10/15/09.  Over 15,000 taxpayers participated in the original program and over 3,000 taxpayers have  since that time have filed to  disclose foreign bank accounts which had not previously been disclosed to the IRS.

Read more about the program here.  Our firm counseled and represented many  clients involved in the previous IRS Offshore Disclosure program with great results. Please contact us if you need assistance of an Attorney CPA with this New program. Anything you tell us is totally confidential under the attorney-client privilege rule.

2011 IRS Voluntary Offshore Disclosure Program Frequently Asked Questions and Answers