PFICs – The Fairytale Definition That Lives Happily Ever After…

I was hoping that tax reform would have done away with, or at least modified, the troublesome provisions surrounding the PFIC or so-called “Passive Foreign Investment Company”.  This was not to be and it prompted me to review the PFIC rules and count the ways they cause trouble! What is a PFIC? A PFIC is … Continue reading PFICs – The Fairytale Definition That Lives Happily Ever After…

It’s Finally Here: The IRS Bible for Voluntary Disclosures

As many will remember, the Offshore Voluntary Disclosure Program (OVDP) closed on September 28th with the promise that the Internal Revenue Service (IRS) would issue new guidance on voluntary disclosures made after that date.  The guidance just arrived in the form of a 5-page Memorandum by Kristen B. Wielobob, Deputy Commissioner for Services and Enforcement, … Continue reading It’s Finally Here: The IRS Bible for Voluntary Disclosures

Gifting Your Way to Freedom – How TCJA Can Help You Expatriate

Not surprisingly over 1,000 individuals expatriated (gave up US citizenship or long term residency) in the third quarter of 2018. This is according to the most recent “Name and Shame” list published by the US Treasury in the Federal Register on November 19, 2018. Most likely the real number is higher, as the accuracy of … Continue reading Gifting Your Way to Freedom – How TCJA Can Help You Expatriate

JUST ANNOUNCED! Foreign Related Tax Inflation Adjustments for Tax Year 2019

The Internal Revenue Service today announced the tax year 2019 annual inflation adjustments for more than 60 tax provisions, including the tax rate schedules and other tax changes. Revenue Procedure 2018-57 provides details about these annual adjustments. The tax year 2019 adjustments generally are used on tax returns filed in 2020. For those of you … Continue reading JUST ANNOUNCED! Foreign Related Tax Inflation Adjustments for Tax Year 2019

Before You Think of Becoming an “American Abroad”, Read This….

I was recently asked about the tax problems faced by Americans who move overseas.  Unfortunately, there are many US tax difficulties faced by Americans abroad. In order to make some sense of this vast topic, let's put the major problems into several basic categories.  Once aware of the problems lurking out there, you can get … Continue reading Before You Think of Becoming an “American Abroad”, Read This….

Recent Case “Willful” FBAR Penalty: Even Death is No Escape!

In a recent FBAR case involving an unreported foreign account maintained at none other than UBS in Switzerland, the court was called upon to decide whether the FBAR civil “willful” penalty assessed against the taxpayer survived his death.  The case is United States v. Schoenfeld (Middle District, Fla. 3:16-cv-1248-J-34PDB), dated 9/25/18, and the court order … Continue reading Recent Case “Willful” FBAR Penalty: Even Death is No Escape!

US Owners of Foreign Corporations – Beware the Downsides

My earlier blog post introduced readers to the concepts of so-called CFCs and PFICs and some of the downsides of owning a "foreign" corporation. It analogized to quicksand simply because it is very easy to be swallowed up in harsh tax results and onerous reporting obligations if planning is not undertaken beforehand. I will remind … Continue reading US Owners of Foreign Corporations – Beware the Downsides

FORM 8938: Infinite Statute of Limitations & Everything Else You Need to Know

My prior blog post gave details about how the Form 8938, an important “Foreign Account Tax Compliance Act” (FATCA) enforcement weapon, is currently failing.  IRS enforcement efforts are soon on the upswing.  This is because the Treasury Inspector General for Tax Administration issued a report over the summer pointing out the IRS' failures with regard … Continue reading FORM 8938: Infinite Statute of Limitations & Everything Else You Need to Know

USA: One Country, Two Citizenships

One Country, Two Citizenships: John Richardson Interviews Virginia La Torre Jeker.  Most people don’t know that the US has two kinds of citizenship  – “Immigration” citizenship and “Tax” citizenship.  Tax citizenship, the monkey on your back, is hard to shake off!  Watch the interview, here.   http://www.youtube.com/watch?v=4Kq94qCiNSY https://www.youtube.com/watch?v=

Married to A Non-US Spouse? Use of “Resident” Election, Filing FBAR and Form 8938

My blog post containing tax-saving tips for the filing of a US income tax return when one is married to  a non-resident alien spouse is here. It will be helpful to read that post before embarking on this one as it sets out the basics and provides the income tax rates and brackets for the 2018 … Continue reading Married to A Non-US Spouse? Use of “Resident” Election, Filing FBAR and Form 8938