US Taxpayer Pleads Guilty to Failure to File a Foreign Bank Account Report

 

            CONCORD - Georges Mazraani, 57, of Windham, pleaded guilty in federal court on Wednesday to willful failing to file a foreign bank account report, Acting United States Attorney John J. Farley announced today.

            According to court documents and statements made in court, federal law requires that a U.S. person having a financial interest in, or signature or other authority over, a bank or other financial account in a foreign country, must file a Foreign Bank Account Report (“FBAR”) with the Treasury Department identifying each foreign account if the aggregate balance of all foreign accounts exceeds $10,000 at any point in the calendar year.  FBAR information is used by the federal government in criminal, tax, or regulatory investigations or proceedings.  A willful failure to file a required FBAR is a felony.

            Defendant Mazraani owned and operated Dot Square, a New Hampshire corporation that exported computers and related goods primarily to Lebanon.  He also had a financial interest in bank accounts held in Lebanon, from which he sometimes wired money to Dot Square’s bank account held in Salem, New Hampshire.  For calendar year 2012, Mazraani filed an FBAR identifying three accounts in Lebanon.  During the years 2013 through 2017, however, Mazraani did not file FBARs, even though he had an interest in at least one Lebanese bank account holding more than $10,000 during each of those years.  For example, in calendar year 2017, $554,245 was wired, in 13 separate wire transmissions, from Mazraani’s account at a bank in Beirut to Dot Square’s business checking account in New Hampshire.  Although Mazraani’s tax preparer advised the defendant’s bookkeeper about the FBAR filing requirement and Mazraani acknowledged on his 2016 and 2017 tax returns that he was required to file an FBAR, he nevertheless failed to file the report. 

           Mazraani is scheduled to be sentenced on February 14, 2022.

           “Failing to file a Foreign Bank Account Report is a federal crime,” said Acting U.S. Attorney Farley.  “By failing to file these reports from 2013 to 2017, the defendant concealed information about foreign bank accounts that he was required to disclose.  We will continue to work with our law enforcement partners to identify and prosecute those who commit tax crimes and other financial offenses.”

           “The law requires companies who use our country’s financial system to provide financial institutions with truthful information about their business operations, but Georges Mazraani admitted today that he knowingly and willfully failed to do that, over the course of five years. In fact, he went out of his way to conceal his bank accounts in Lebanon, despite a reminder from his bookkeeper,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “The FBI will not hesitate to aggressively investigate companies who are doing business in the United States but failing to adhere to our laws.”

            “The accurate reporting of foreign bank accounts ensures fairness and integrity in the U.S. tax system. By his own admission today, Mr. Mazraani deliberately avoided his reporting requirements in an attempt to hide assets. As a result of his actions, he is now subject to a federal felony conviction,” said Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service-Criminal Investigation Division, Boston Field Office. 

            This matter was investigated by the Internal Revenue Service, Criminal Investigation Division, the Department of Commerce, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney John S. Davis.

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If you have not been reporting your foreign bank accounts you could incur heavy penalties and possible criminal prosecution.  We can help. Email Us to request a consultation with the absolute privacy of attorney client privilege. Email us at ddnelson@gmail.com

Expatriates Living Abroad May be at Risk for an Audit?

Even though you live and work abroad the IRS may still audit your return. This is most often accomplished by mail and telephone. Failure to respond to any audit notice from the IRS will result in assessment for taxes due for all items questioned.

There are some objective factors that may put you as an expatriate

at higher risk for experiencing an IRS audit. Here’s a quick checklist.

• Do you earn over $200,000 annually?
• Have you failed to report past income on your return?
• Have you claimed more itemized deductions than allowed?
• Do you operate a business?
• Did you claim rental losses on your return?
• Did you take a home office deduction?
• Did you claim gambling losses on your return?
• Do you hold a foreign bank account or earn income from a foreign source?
• Do you own a foreign corporation?
• Do you have an interest in a foreign trust>
• Do you own foreign mutual funds (requires special forms be filed with your tax return)?

While none of these factors ensures that you will be audited, they do help create a picture of the type of taxpayer that may draw additional IRS scrutiny.  Under the new Presidential administration there will be a significant increase in audits of those who live outside of the USA.

We can help you if your receive an IRS notice with your response and represent you in an audit.  Email us at ustax@hotmail.com or phone 949-480-1235 (US)

US Social Security Administration Has Three Offices in Mexico to Help Expats Living in Mexico

If you reside in Mexico and have questions regarding services provided by the Social Security Administration (SSA), you must contact the SSA Federal Benefits Unit (FBU) located in Mexico. For more information on their services and how to contact them, please visit their webpage at: https://mx.usembassy.gov/u-s-citizen-services/social-security

For comprehensive information on SSA’s services abroad, please visit SSA’s webpage Service Around the World.

If you are already receiving SSA benefits payments, there will be no change in the method of distribution of those payments.

Need help with your US taxes, past due taxes, IRS collection matters, US estate planning contact a US Attorney with 30 years experience assisting expats in Mexico.  Email. ddnelson@gmail.com Or send a whats app to 18185199219.

US TAXPAYERS CAN LOSE THEIR PASSPORT FOR UNPAID FEDERAL TAXES

The IRS has begun issuing notice CP508C to taxpayers with “seriously delinquent” tax debt and the service has resumed its program of notifying the State Department of taxpayers’ unpaid federal debts.

The U.S. Department of State generally will not renew a passport or issue a new passport to taxpayers after receiving a certification of “seriously delinquent” tax debt from the IRS, and they may revoke or place limitations on current passports. Generally, you can use your passport until you’re notified by the U.S. Department of State that it’s taking action to revoke or limit your passport.

Once a taxpayer receives the notice CP508C, they have 30 days to dispute the notice. Taxpayers are cautioned to retain the notice until the issue is resolved. The IRS contact number is in the top right-hand corner of the CP508C notice. If the debt has already been satisfied, the taxpayer will need to have proof of payment available.

Seriously Delinquent Tax Debt - Seriously delinquent tax debt is an individual's unpaid, legally enforceable federal tax debt totaling more than $54,000 (including interest and penalties) for which:

• Notice of federal tax lien has been filed and all administrative remedies under the Internal Revenue Code have lapsed or been exhausted, or 
• A levy has been issued. 

The seriously delinquent tax debt amount that triggers the IRS to notify the State Department is inflation adjusted, so the $54,000 amount applies to 2021 and will no doubt increase for 2022.

Getting the Certification Reversed – Once IRS has certified the “seriously delinquent” tax debt to the U.S. Department of State the IRS will reverse the certification when:

• The tax debt is fully satisfied or becomes legally unenforceable. 
• The tax debt is no longer seriously delinquent. 
• The certification is erroneous. A previously certified debt is no longer seriously delinquent when: 
• The taxpayer and the IRS enter into an installment agreement allowing the debt to be paid over time. 
• The IRS accepts an offer in compromise to satisfy the debt. 
• The U.S. Department of Justice enters into a settlement agreement to satisfy the debt. 
• Collection is suspended because the taxpayer requests innocent spouse relief. 
• The taxpayer makes a timely request for a collection due process hearing in connection with a levy to collect the debt.

Additionally, a certified debt is no longer seriously delinquent for any taxpayer:

• Who is in bankruptcy. 
• Who is identified by the IRS as a victim of tax-related identity theft. 
• Whose account the IRS has determined is currently not collectible due to hardship. 
• Who is located within a federally declared disaster area 
• Who has a request pending for an installment agreement with the IRS. 
• Who has a pending offer in compromise with the IRS. 
• Who has an IRS-accepted adjustment that will satisfy the debt in full.

How long will it take to get a certification reversed? Once the tax problem with the IRS has been resolved in one of the instances included above, the IRS will, within 3 days, reverse the certification and provide notification to the U.S. Department of State.

If a taxpayer is already overseas when the State Department takes action to revoke or limit the taxpayer’s passport, the agency will either limit the passport only for return travel to the U.S. or issue a limited passport that only permits return travel.

I

FBAR Form 114 Filing Deadline has not been extended - but there is an automatic Extension

With the extension of the individual filing deadline to May 17, 2021, practitioners have been asking if the FBAR filing deadline was also extended. The assumption for many was that, because the FBAR filing deadline has been adjusted to match the individual filing deadline, the FBAR deadline would be extended too. Today the IRS has stated that the extension of the federal income tax filing due date and other tax deadlines for individuals to May 17, 2021, does not affect the FBAR requirement. (IR-2021-83) However, keep in mind that taxpayers are allowed an automatic extension to October 15 if they fail to meet the FBAR annual due date of April 15. You don’t need to request an extension to file the FBAR.

IF you need help with your FBAR or catching up with past unfiled FBAR forms, contact us. There are procedures to avoid the $10,000 late filing penalty if you file the form properly. Remember if your combined highest balances in foreign bank accounts  (or other financial accounts in your congtrol) ever exceed $10,000 (even if just for a day) you must file the form. The form must be filed in your sign on someone elses account or corporate accounts also.  Email us at
taxmeless.  Skype: dondnelson

Beware of IRS Tax Scams

 

A Mini Consultation is Now Available with A US Tax Attorney and Partner in a US CPA Firm about your Expat, Nonresident or International Tax Matters

 If you have specific expat, international or nonresident, tax questions on your personal situation and need to discuss it with an US expatriate international tax expert, with the protection of  Attorney-Client privilege, you can request a "Mini Consultation."   The fee is  $300 US for up to 30 minutes of Mr. Nelson's professional legal tax advice over the phone, skype, zoom or email.  We are virtual and no need to visit our office.

 If  you send us an outline of your situation, facts and questions in advance, we prepare in advance and this time is extremely productive and usually resolves all of your questions  within the time allowed. We can find a solution to your US or US State tax problems.

And remember as a partner in a US CPA firm we can also prepare the returns, forms, and amended returns to solve your tax problems.  We are a one stop solution and make the entire process simple and easy.  Our specialty if fiing past due returns and assisting nonresidents with the tax aspects of owning US real estate.

Many hundreds of expat taxpayers located everywhere in the world  have used "Mini Consultations" to resolve their tax problems and issues.  US Phone (949) 480-1235. US Fax (949) 606-9627 skype address dondnelson. Email:ddnelson@gmail.com  Whatsapp No.  1(818) 519-9219.   Visit our website at www.taxmeless.com 

We look forward to resolving your tax problems and/or  preparing your  US return. Thank you. Don