{"id":2643,"date":"2018-06-11T08:52:07","date_gmt":"2018-06-11T12:52:07","guid":{"rendered":"http:\/\/keysolutions.us\/blog\/?p=2643"},"modified":"2018-06-11T08:52:07","modified_gmt":"2018-06-11T12:52:07","slug":"you-may-be-running-out-of-time-if-you-own-offshore-accounts","status":"publish","type":"post","link":"https:\/\/keysolutions.us\/blog\/you-may-be-running-out-of-time-if-you-own-offshore-accounts\/","title":{"rendered":"You May Be Running Out of Time If You Own Offshore Accounts"},"content":{"rendered":"

You May Be Running Out of Time<\/strong><\/span><\/h1>\n

If You Own Offshore Accounts<\/strong><\/span><\/h1>\n

September 28, 2018 Effective Date<\/strong><\/span><\/h2>\n

The U.S. Government, concerned about offshore tax evasion, implemented the Foreign Account Tax Compliance Act (FATCA) which included enhanced enforcement, onerous penalty provisions, criminal prosecutions, and implemented third-party reporting.<\/p>\n

By way of background, we suggest you read our June 4, 2013<\/a>, June 21, 2012<\/a> and August 9, 2016<\/a> blogs that discussed the Bank Secrecy Act (BSA) that requires\u00a0certain U.S. persons who have a financial interest in or signature authority over a foreign financial account to report the account annually to the Department of Treasury by electronically filing Financial Crimes Enforcement Network (FinCEN) Form 114, Report of Foreign Bank and Financial Accounts (commonly called FBAR), through FinCEN\u2019s BSA E-Filing System. In addition to FBAR reporting requirements, in certain circumstances FATCA requires filing Form 8938, Statement of Specified Foreign Financial Assets, with the federal Form 1040 income tax return.<\/p>\n

WHO MUST FILE A FBAR?<\/strong> A U.S. person (includes U.S. citizens and resident aliens) is required to file a FBAR if: The person had a financial interest in or signature authority over (or any other authority over) at least one financial account located outside of the United States and\u00a0the\u00a0aggregate<\/strong>\u00a0value of\u00a0all<\/strong>\u00a0foreign financial accounts<\/u>\u00a0exceeded $10,000\u00a0at any time<\/u><\/strong>\u00a0during a calendar year.<\/p>\n

Many U.S. citizens and resident aliens were unaware that if they owned certain foreign assets, such as cash, monies held in escrow accounts, investment accounts, foreign securities (not held in a USA account), foreign pension plans, foreign joint accounts with family members, etc., that they may have had to report those assets to the U.S. Treasury and the IRS.<\/p>\n

The USA may be the only country in the world that taxes its citizens and residents on ALL of their world-wide income. While there were some wealthy U.S. citizens who fraudulently hid their money from the IRS to avoid taxes, the FBAR reporting also affected many others. For example, immigrants to the U.S., especially those who self-prepared their U.S. tax returns, may have been unaware of their foreign income and asset reporting requirements.<\/p>\n

Due to the onerous penalties for failure to report these foreign assets to the U.S. Treasury and\/or the IRS, the Offshore Voluntary Disclosure Program (OVDP) was enacted to help individuals avoid criminal prosecution if they disclosed their foreign holdings and paid a substantial penalty.<\/p>\n

The IRS believes that the OVDP has been very successful as evidenced by the significant decline in the number of taxpayers participating as well as an increase in awareness of offshore tax and reporting obligations. It has been reported by the IRS that the OVDP has resulted in more than 54,000 voluntary disclosures from individuals who have paid about $8 billion in back taxes, interest and penalties since the program was implemented in 2009.<\/p>\n

Accordingly, the IRS is closing its OVDP program effective September 28, 2018. Does this mean that FBAR reporting is no longer required? NO!<\/strong> It simply means that the 2014 OVDP program is coming to a close. Stopping offshore tax noncompliance and evasion remain top priorities of the IRS.<\/p>\n

The IRS will be announcing on its website<\/a> how such foreign account disclosures can be made after September 28. It is expected that the IRS will be asking for additional information from taxpayers and that the penalties will be increased and due at the time that the disclosure application is made.The IRS will continue to enforce offshore compliance with tax and FBAR requirements using information received under the FATCA, the network of intergovernmental agreements between the U.S. and partner jurisdictions, automatic third-party account reporting, and other data-rich sources such as the Department of Justice\u2019s Swiss Bank Program and various John Doe Summonses. The IRS leverages information resources using enhanced data analytics to continue to make it more difficult to evade tax by hiding offshore.<\/p>\n

Planning TIP<\/u><\/strong>:<\/span><\/p>\n

If you own foreign assets of any type that have not been disclosed to the U.S. Treasury or the IRS (an annual requirement), and you are concerned that your non-reporting was due to willful conduct<\/strong> and are concerned about criminal prosecution (and if you are not concerned about criminal prosecution, you should be), immediately consult with your legal counsel and tax professional. Take this action step now so as not to miss the September 28, 2018 date when the current OVDP terminates.<\/p>\n

Planning TIP<\/u><\/strong><\/span>:<\/p>\n

If your failure to report foreign financial assets did not result from willful conduct on your part, immediately consult with your legal counsel and tax professional about the IRS\u2019s Streamlined Foreign Offshore Procedures program<\/a>.<\/p>\n

If you would like to discuss your business or personal tax planning<\/a>, tax preparation<\/a> and other financial concerns with an experienced tax professional, we invite you to call 610-594-2601<\/a> today to make an appointment at our Exton PA CPA office<\/a> to discuss your situation. You can also schedule a consultation at Click Here<\/a>.<\/p>\n

Copyright \u00a9 2018 Keystone Financial Solutions, P.C.\u00a0 All rights reserved.\u00a0 BE SURE TO READ THE DISCLAIMER PAGE: Content in this blog is for educational purposes only and should not be considered as the rendering of tax, legal or investment advice. The publisher of this blog makes no representations as to the accuracy or completeness of any information herein, will not be liable for any errors or omissions, and shall not assume liability for any losses, injuries, or damages from the display or use of this information.<\/strong><\/h5>\n

About F. Bryan Haarlander, EA, CTRS:<\/u><\/strong><\/p>\n

Bryan Haarlander is an IRS licensed Enrolled Agent and who owns and operates a specialized tax services firm serving clients in the western suburbs of Philadelphia, PA, which includes the cities of Chester Springs, Coatesville, Collegeville, Devon, Downingtown, Exton, Frazer, King of Prussia, Paoli, Philadelphia, Phoenixville, Pottstown, Radnor, Reading, Wayne, West Chester in Berks, Chester,\u00a0 Delaware, Montgomery and Philadelphia Counties, as well as clients in Delaware, New Jersey, New York and throughout the continental USA.<\/p>\n

A Certified Tax Resolution Specialist, Bryan is well-known for his IRS tax resolution expertise and his book How to Resolve Your IRS Tax Debt Problems. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

You May Be Running Out of Time If You Own Offshore Accounts September 28, 2018 Effective Date The U.S. Government, concerned about offshore tax evasion, implemented the Foreign Account Tax Compliance Act (FATCA) which included enhanced enforcement, onerous penalty provisions, criminal prosecutions, and implemented third-party reporting. By way of background, we suggest you read our […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3],"tags":[69,73,63,33,34,21,64,71,31,72,66,23,41,65,32,40,102,103,39,101,67,68,38,70,100,37,36,35,42,28],"class_list":{"0":"post-2643","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-irs-tax-planning-ideas-tips-news","7":"tag-audits","8":"tag-bankruptcy","9":"tag-bryan-haarlander","10":"tag-chester-county-cpa","11":"tag-exton-accountant","12":"tag-exton-cpa","13":"tag-f-bryan-haarlander","14":"tag-first-time-abatement","15":"tag-frank-haarlander","16":"tag-innocent-spouse","17":"tag-installment-agreements","18":"tag-irs","19":"tag-irs-tax-debts","20":"tag-irs-tax-payments","21":"tag-keystone-financial-solutions","22":"tag-offer-in-compromise","23":"tag-offshore","24":"tag-offshore-voluntary-disclosure","25":"tag-oic","26":"tag-ovdp","27":"tag-partial-installment-agreements","28":"tag-penalty-abatement","29":"tag-philadelphia-cpa","30":"tag-reasonable-cause","31":"tag-streamlined-offshore","32":"tag-tax-blog","33":"tag-tax-expert","34":"tag-tax-planning","35":"tag-tax-resolution","36":"tag-west-chester-cpa","37":"entry"},"aioseo_notices":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9W9tf-GD","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2643","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/comments?post=2643"}],"version-history":[{"count":10,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2643\/revisions"}],"predecessor-version":[{"id":2653,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2643\/revisions\/2653"}],"wp:attachment":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/media?parent=2643"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/categories?post=2643"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/tags?post=2643"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}