Irs Offshore Fbar Voluntary Disclosure Program: What Is The Best Possible Option?

There once was a point in time when US taxpayers could protect foreign financial records with impunity

. However, that has changed because of numerous new information sharing agreements the Internal revenue service has created with other countries. In fact, the Internal revenue service already has the information on where these accounts are and who they belong to, they are just too busy sorting through the files to get the time to prosecute everybody. With that in mind the Internal revenue service has promoted its IRS offshore FBAR voluntary disclosure program. The penalties increase with each new version of the IRS offshore FBAR voluntary disclosure program, and the most recent version is the third. The present IRS offshore FBAR voluntary disclosure program has no expiration date. However, at any time these terms could change. .

This is the way the IRS offshore FBAR voluntary disclosure program works:

A taxpayer finds a tax lawyer to study the specifics of the case and make sure a disclosure into the IRS offshore FBAR voluntary disclosure program is the best move. The tax lawyer then mails a letter in and works to reconcile 8 years of returns to include unreported income and missing FBARs. The taxpayer, if they are able, pays the taxes and interest due. At that point, the taxpayer has two choices. They could accept the 27.5% penalty on the highest account value over the last 8 years by agreeing to the standard penalty structure. If the taxpayer purposely evaded taxes, this the best choice.

The supplementary alternative for the taxpayer is to choose to fight for lower penalties rather than agreeing to the standard penalty structure. Usually, this equals a 5% penalty on the higher account value. If the account is worth less than $75,000, only a 12.5% penalty will be charged.

In either case, opt-out or not, the taxpayer's lawyer will also undergo a mini audit to verify that the taxpayer's asserted income is the same as the bank account information. If a taxpayer opt-outs and disagrees with the penalty amount, the taxpayer could take an administrative appeal. Then, if the taxpayer is discontented with those results, they can take the case to US tax court. However, while this is very unlikely, the US Supreme Court could end up as the ending decider of the penalty amount.

by: jontgy1mbe

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