Showing posts from November, 2014

FBARs and Form 8938

Back in March 2014, I first wrote about FBARs
But my recent interaction with clients suggests that I need to revisit the topic.

Each U.S. citizen and permanent resident must report worldwide income to the IRS even when paying taxes elsewhere. Moreover, you must file an annual FBAR (now called FinCEN Form 114) disclosing your foreign bank accounts if their aggregate value exceeds $10,000 at any point during the year. The penalties for either failure are big, potentially even criminal. FBAR penalties are even worse than tax evasion.

According to the FBAR instructions, U.S. persons include U.S. citizens and U.S. residents. Similarly, the FBAR regulations state that a U.S. person is a citizen of the United States or a resident of the United States, meaning “an individual who is a resident alien under 26 USC 7701(b) and the regulations thereunder.”
In the minds of so many people, FBARs are tied to FATCA.  Nothing …

IRS Goes Undercover and the Movement against Corp Tax Avoidance

When it comes up in conversation, I keep telling people one thing – forget FATCA, we are in the midst of a movement that is much bigger than just one law. The drive for international transparency and substance seems unstoppable at this point. It is not just happening at the individual level, it is happening at the level of MNCs as well

Individuals -

In March this year I wrote about an acquaintance of mine who was arrested for tax fraud and money laundering

One of the things that jumped out at me is the extent to which undercover operatives are being used by the Federal government in general, and the IRS in particular. According to a November 15th article in the New York Times, at the Internal Revenue Service, dozens of undercover agents chase suspected tax evaders worldwide, by posing as tax preparers, accountants, drug dealers or yacht buyers and more, court records show. Interestingly, undercover agents at the I.R.S., a…

Taxpayers Need to be Careful in Evaluating Tax Advisers Based Solely on PRICE