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Dear Reader,
Were you convinced that no one would find the money you had in that offshore bank account? Do you know that the IRS issued a Subpoena to Master Card and Visa and got lists of all U.S. persons with offshore credit cards? Do you know that this list has been “updated” several times? Are you aware that the IRS has a special task force assigned to tracking down and penalizing those with offshore credit cards and offshore bank accounts? Are you concerned about the situation with UBS, which has been well documented in the news?
If you are audited, and there is an international issue, the first step is to SAY NOTHING! If you are under IRS investigation, you need immediate legal help to negotiate a favorable settlement and to protect your rights. You must have an agreement in place before providing any information.
In many cases, the minimum civil penalty for not disclosing an offshore bank account or offshore credit card can be $25,000 or the greatest of 50% of the balance in the account at the time of the violation or $100,000. The criminal penalty for willful failure to file a FBAR is a fine of not greater than $250,000 and/or imprisonment for not more than five years. Note that these penalties can be imposed for each year.
I often find that my clients were taken in by unscrupulous offshore banking promoters looking to make a quick buck. While the person on whom you relied to form your structure is sitting safely in the Caribbean, you are here and the IRS is at your door. Even if your monetary assets are offshore, keep in mind that your most important asset might be sitting in jail!
I note that all of these problems could have been avoided. Had you been informed of and filed the necessary IRS and U.S. Treasury forms, you would have no issues with the IRS. Offshore tax law is simple:
1) file the necessary forms each year and
2) personal offshore asset protection does not reduce or defer the taxes of a US resident or citizen.
For more information on the IRS and their focus on audits of offshore accounts, see:
http://www.irs.gov/newsroom/article/0,,id=105695,00.html.
The key to resolving issues arising out of offshore credit cards, offshore bank accounts and offshore banking structures is to prevent the matter from escalating from civil to criminal and negotiating a deal before providing any information to the IRS. Therefore, it is urgent you hire a qualified tax attorney as early as possible in the process.
Best regards,
Chris Rusch
ABOUT THE AUTHOR:
Chris Rusch is a California licensed attorney who has represented clients before the IRS in many States. His practice is focused on international taxation, foreign corporate formations, and resolving complex tax controversies. Please visit his website at http://www.ruschlaw.com/ for more information.
Note: Chris
Rusch is the author of The Expat Tax Bible 2010, published by
International Living. For additional information
click here
to be taken to IL's website.Were you convinced that no one would find the money you had in that offshore bank account? Do you know that the IRS issued a Subpoena to Master Card and Visa and got lists of all U.S. persons with offshore credit cards? Do you know that this list has been “updated” several times? Are you aware that the IRS has a special task force assigned to tracking down and penalizing those with offshore credit cards and offshore bank accounts? Are you concerned about the situation with UBS, which has been well documented in the news?
If you are audited, and there is an international issue, the first step is to SAY NOTHING! If you are under IRS investigation, you need immediate legal help to negotiate a favorable settlement and to protect your rights. You must have an agreement in place before providing any information.
In many cases, the minimum civil penalty for not disclosing an offshore bank account or offshore credit card can be $25,000 or the greatest of 50% of the balance in the account at the time of the violation or $100,000. The criminal penalty for willful failure to file a FBAR is a fine of not greater than $250,000 and/or imprisonment for not more than five years. Note that these penalties can be imposed for each year.
I often find that my clients were taken in by unscrupulous offshore banking promoters looking to make a quick buck. While the person on whom you relied to form your structure is sitting safely in the Caribbean, you are here and the IRS is at your door. Even if your monetary assets are offshore, keep in mind that your most important asset might be sitting in jail!
I note that all of these problems could have been avoided. Had you been informed of and filed the necessary IRS and U.S. Treasury forms, you would have no issues with the IRS. Offshore tax law is simple:
1) file the necessary forms each year and
2) personal offshore asset protection does not reduce or defer the taxes of a US resident or citizen.
For more information on the IRS and their focus on audits of offshore accounts, see:
http://www.irs.gov/newsroom/article/0,,id=105695,00.html.
The key to resolving issues arising out of offshore credit cards, offshore bank accounts and offshore banking structures is to prevent the matter from escalating from civil to criminal and negotiating a deal before providing any information to the IRS. Therefore, it is urgent you hire a qualified tax attorney as early as possible in the process.
Best regards,
Chris Rusch
ABOUT THE AUTHOR:
Chris Rusch is a California licensed attorney who has represented clients before the IRS in many States. His practice is focused on international taxation, foreign corporate formations, and resolving complex tax controversies. Please visit his website at http://www.ruschlaw.com/ for more information.