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Showing posts from July, 2017

Another Plea Agreement for failing to declare an Offshore Account

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If you have not already done so, please read this primer on FBARs before continuing - 
http://www.derrenjoseph.com/2014/11/fbars-and-form-8938.html

So often, we are asked whether the authorities come after taxpayers who failed to disclose 6 figure accounts?  
Or whether the focus is only on taxpayers who fail to disclose 7 figures and above.  

Here's an example of a taxpayer failing to disclose a mid 6 figure account and facing the wrath of the US Government.

USAO CD CA announced here the plea (penalty of $100,000 (par. 5(g))) by a plastic surgeon to one FBAR criminal count.  The relevant excerpts from the announcement are:
          According to the plea agreement filed in this case, while working as a plastic surgeon in Beverly Hills, Mani began to travel to Dubai in 2011 to perform plastic surgery for a foreign medical center. Mani’s accountant, who was aware that Mani was earning foreign income, informed him that he would be required to report any foreign bank accounts under his ow…

IRS heats up compliance enforcement on passport holders with tax debt

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Expats and travelers with tax debt should take notice and take measures to get back into good standing with the IRS.
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In the past decade, Congress and the IRS have made numerous efforts to close the international tax gap.  This is the amount of taxes the Treasury loses each year from U.S. taxpayers abroad not reporting income, paying taxes, or filing tax returns. In recent years, the IRS has tried to close the international tax gap with the Foreign Account Tax Compliance Act (FATCA) and a series of offshore voluntary disclosure programs—all aimed at enforcing proper reporting of foreign financial accounts and overseas income. In December 2015, Congress tried to add another tool to help the IRS address the underpayment part of the tax gap. The provision, Sec. 7345, would give the government the ability to restrict the passports of individuals who owe "seriously delinquent tax debt" (Sec. 7345(a)). The new compliance enforcement is supposed to roll out s…

Is Trump's U.S.A. the new tax haven?

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BVI Secrecy No More

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The BVI Government has passed new legislation that requires Registered Agents for BVI entities to make certain information on the beneficial owners of all BVI companies and limited partnerships accessible by a secure Government search system. The Beneficial Ownership Secure Search System Act, 2017 (the “Act”), which was further amended on 16 June 2017, enables the creation of a new Beneficial Ownership Secure Search System (“BOSS system”). The new law is in addition to the BVI’s existing AML legislation, which already requires Registered Agents to collect and maintain beneficial ownership information for the entities to which they provide services.

The Act, which enters into force on 30 June 2017, was drafted to implement the terms of the Exchange of Notes which the governments of the BVI and the United Kingdom entered into on 8 April 2016. It provides the legal framework for recording accurate beneficial ownership information and the disclosure of that information to law enforcement a…