{"id":2929,"date":"2019-01-22T09:46:36","date_gmt":"2019-01-22T14:46:36","guid":{"rendered":"http:\/\/keysolutions.us\/blog\/?p=2929"},"modified":"2019-01-22T09:46:42","modified_gmt":"2019-01-22T14:46:42","slug":"schoolteacher-assessed-800000-fbar-penalty","status":"publish","type":"post","link":"https:\/\/keysolutions.us\/blog\/schoolteacher-assessed-800000-fbar-penalty\/","title":{"rendered":"Schoolteacher Assessed $800,000 FBAR Penalty"},"content":{"rendered":"\n

When your tax professional\ninquires if you had an interest in or controlled one of more foreign accounts\nwith an aggregate value above $10,000 at any time<\/em><\/strong> during the\ncalendar year, give this question the\nattention it deserves<\/strong>. The question is quite broad. If you have family\nin a foreign country and have joint ownership with another person of a foreign\naccount (not restricted to bank accounts), you may have a foreign reporting\nresponsibility. For example, you are a joint owner with your parents on a\nforeign account. The money may be your parents and your name may be on the\naccount for convenience purposes only, but for U.S. reporting purposes, you are\nan owner of that account. Also if you relocated from a foreign country to the\nU.S. and hold a retirement account in the foreign country, you may have a foreign\nreporting responsibility depending upon the tax treaty the U.S. has with that\nforeign country. It is best to make inquiries with your tax professional to\navoid the FBAR (Foreign Bank Account Report) penalty. <\/p>\n\n\n\n

And then there are those\nindividuals, like Mindy Norman. She opened a Swiss numbered bank account in\n1999 with Union Bank Switzerland (UBS) to conceal her income from the IRS. A\nyear later, she took another step to conceal her financial information from the\nIRS by signing to waive her right to invest in U.S. securities. <\/p>\n\n\n\n

In 2008, Norman transferred\nher funds out of UBS when the bank notified her that it would no longer provide\noffshore banking and would assist the IRS in identifying U.S. clients who may\nhave engaged in tax fraud. She could not provide the courts with any evidence\nthat she attempted to find out what her U.S. reporting responsibilities were\nwith respect to her foreign investments. <\/p>\n\n\n\n

On Norman\u2019s 2007 Form 1040\n(Schedule B), she claimed that she had no foreign bank account. Remember that\nwhen you sign your Form 1040, you are doing so under penalties of perjury.<\/p>\n\n\n\n

In 2009 when she could have\napplied for the Offshore Voluntary Disclosure Program, which would have at\nleast resulted in a significant reduction of FBAR penalties, she filed what is\nknown as a quiet disclosure<\/em><\/strong>through\nher Swiss accountant by filing amended tax returns and FBARS for the years 2003\n\u2013 2008, but failed to notify the IRS or admitting she violated the law. The quiet\ndisclosure<\/em><\/strong> is when a taxpayer merely marks the yes<\/em> boxes on Schedule B that foreign accounts exist and hopes for\nthe best.<\/p>\n\n\n\n

This non-compliance approach\nresulted in Norman being assessed an $803,530 penalty (which was 50% of the\nunreported balance in her account) for a willful failure to file a FBAR (Form\nFinCEN 114) with respect to her UBS account she held in 2007.<\/p>\n\n\n\n

If you have any accounts or\ninvestments relating to assets held outside of the U.S., be sure to share this information\nwith your tax professional.<\/p>\n\n\n\n

<\/p>\n\n\n\n

<\/p>\n\n\n\n

Bryan Haarlander, EA, CTRS
Keystone Financial Solutions, Inc.
47 Marchwood Road, Ste 2G
Exton, PA 19341
(610) 594-2601
www.keysolutions.us
www.stopmytaxproblems.com
www.taxexpertblog.com


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When your tax professional inquires if you had an interest in or controlled one of more foreign accounts with an aggregate value above $10,000 at any time during the calendar year, give this question the attention it deserves. The question is quite broad. If you have family in a foreign country and have joint ownership […]<\/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":[132,69,73,63,33,34,21,64,71,31,72,66,23,41,65,32,199,40,39,67,68,38,70,151,37,36,35,150,42,28],"class_list":{"0":"post-2929","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-irs-tax-planning-ideas-tips-news","7":"tag-accuracy-related-penalty","8":"tag-audits","9":"tag-bankruptcy","10":"tag-bryan-haarlander","11":"tag-chester-county-cpa","12":"tag-exton-accountant","13":"tag-exton-cpa","14":"tag-f-bryan-haarlander","15":"tag-first-time-abatement","16":"tag-frank-haarlander","17":"tag-innocent-spouse","18":"tag-installment-agreements","19":"tag-irs","20":"tag-irs-tax-debts","21":"tag-irs-tax-payments","22":"tag-keystone-financial-solutions","23":"tag-mindy-norman","24":"tag-offer-in-compromise","25":"tag-oic","26":"tag-partial-installment-agreements","27":"tag-penalty-abatement","28":"tag-philadelphia-cpa","29":"tag-reasonable-cause","30":"tag-tax-adviser-near-me","31":"tag-tax-blog","32":"tag-tax-expert","33":"tag-tax-planning","34":"tag-tax-professional-near-me","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-Lf","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2929","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=2929"}],"version-history":[{"count":8,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2929\/revisions"}],"predecessor-version":[{"id":2937,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/posts\/2929\/revisions\/2937"}],"wp:attachment":[{"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/media?parent=2929"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/categories?post=2929"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/keysolutions.us\/blog\/wp-json\/wp\/v2\/tags?post=2929"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}