Have An Overseas Bank Account - Irs Is Looking

These are not the days to have a non-disclosed overseas bank account. If you do have such an overseas bank account, you are in for mighty rough sailing. For decades, you could count on foreign banks and the Swiss keeping secret account from the prying eyes of all interested governments. The American government tried to penetrate the wall of silence holding these secret accounts, and for years the government failed in its quest. It's all changed now. The IRS went to court against the Union Bank of Switzerland, also known as UBS in an attempt to force the huge European bank to disclose the accounts, and more importantly the names of American citizens holding overseas bank accounts.

Thousands of Americans maintain overseas bank account(s) illegally. It is not the holding of such an account that is illegal. It's the non-disclosure to the Internal Revenue Service that constitutes illegality. Every year your tax form contains a provision with a box that requires checking if you maintain an overseas bank account. If you do have such an account, and you don't check the box, you are in violation. The number of Americans with legal foreign accounts is in the hundreds of thousands. As long as you properly disclose their existence to the IRS, and report any associated income from such accounts, you're fine.

UBS shocked the holders of these accounts by agreeing to give up the names of several hundred of the account holders. The names given up were those which the bank believes are guilty of criminal behavior. You are making a calculated gamble if you are such a holder. The number of Americans having such accounts at UBS alone are in the range of 50,000 plus. The bank is giving up only 250 accounts to start begin with. Are you one of the 250 to be handed over to the government, or are you one of the remaining 50,000? That's the gamble you are taking, and what a gamble it is.

A formal IRS government disclosure program has been created. It allows you to reveal your identity to the IRS until September 23rd. In exchange for your voluntary compliance, the government will probably not pursue criminal actions against you. Such charges would result in a jail sentence. Clemency is the rule of the day and certain fines would be voided. If however, you decide to wait until after the deadline, or if the government should find you first perhaps as a result of the accounts handed over, this could develop into a nightmare you don't want to have. The IRS does can employ its powers which includes liens, arrests, confiscations and a whole set of actions we are better off not knowing.

By merely having an overseas bank account you are not in violation. By not revealing the existence of the account to the IRS, this is what results in violation. Again, it is the non-disclosure of the account to the IRS that creates the violation. There are hundreds of thousands of Americans with legal overseas accounts. To remain within the law, they properly check the box on their tax forms noting the existence of such accounts, and they pay taxes on any and all income generated by such accounts.

The government assumes that you have other motives for maintaining such an overseas account if you allow yourself to be non-disclosed. As an example, there is the issue of where the funds came from and why are you covering up their existence. Were the funds in the account obtained illegally. If the government finds the account and subsequently contacts you, you are opening yourself up to a full investigation, and examination of your complete financial picture - sometimes called a lifestyle audit.

It's this simple, if you have an overseas account that is non-disclosed, you probably should reach out and retain a sophisticated CPA or tax attorney. If you feel your case has real complexity, and that criminal prosecution could result, consider working with a criminal tax attorney. What you don't want to wait on this and do nothing. Time is not on your side. Find a legal representative and deal with the problem. Let him act as your contact with the IRS. The alternative of interacting yourself, or doing nothing is not an alternative at all.

You have read the best review article categorized by IRS Tax Attorney and the title Have An Overseas Bank Account - Irs Is Looking. You can bookmark or spread this post by using this URL https://attorneysearchtips.blogspot.com/2012/02/have-overseas-bank-account-irs-is.html. Thank You!