As a tax practitioner I have assisted many taxpayers for decades with expatriation issues (i.e., relinquishing US citizenship or a green card held for at least 8 tax years). In the best case scenario, the taxpayer can avoid being treated as a "covered expatriate" (CE). Sometimes tax planning, correcting tax returns or submitting delinquent international … Continue reading Expatriation and Tax Compliance – IRS Fails to Process the Tax Return
A very recent FBAR case teaches us a few things. My colleague, attorney John Richardson, noted this after reading the case: "When charities need to raise money they will often have a bake sale or an auction. When the US government wants to raise money it uses an 'FBAR Fundraiser'". Readers, draw your own opinion! … Continue reading Recent FBAR Case: IRS Seeks “Willful” Penalty $8.8M Without Much Regard for the Facts
The Bank Secrecy Act (BSA) contained in Title 31 of the United States Code, requires that every year US persons must report certain foreign financial accounts, such as bank accounts, brokerage accounts and mutual funds, to the Treasury Department and to keep certain records with regard to these accounts. The reporting is done by filing … Continue reading Oops… Made a Mistake on an FBAR?
Today's post is in two parts and was written with my colleague John Richardson, J.D. On March 28, President Joe Biden released the FY2023 Budget, also known as the Green Book, available here. The Green Book is not proposed legislation, but it might be viewed as a kind of reading of the tea leaves showing … Continue reading “With Liberty and Justice (and Death Taxes) for All” …. Biden Proposal Changes the Taxation Game for Gifts and Inheritances (Part I)
The Treasury Inspector General for Tax Administration (TIGTA) just issued a damning report on FATCA: Additional Actions Are Needed to Address Non-Filing and Non-Reporting Compliance Under the Foreign Account Tax Compliance Act (Report # 2022-30-019 4/7/22), available here. The TIGTA audit was undertaken to evaluate IRS efforts to actually use the reams and reams of … Continue reading Treasury Inspector General Says FATCA is a Big Fat Flop ….So Far
My earlier blog post, here examined some of the United States income tax consequences that could occur when a taxpayer mistakenly classifies an advance to a foreign corporation as a “loan” but that the Internal Revenue Service (IRS) treats as a stockholding interest (“equity”) in the corporation. Two follow up posts, here and here examined the … Continue reading Tax Tips for the US Investor in a Foreign Start-Up: Convertible Notes
My recent blog post, here examined some of the tax consequences that could occur when a taxpayer mistakenly classifies an advance to a foreign corporation as a “loan” but that the Internal Revenue Service (IRS) treats as a stockholding interest (“equity”) in the corporation. Last week’s blog post began examining factors used by the courts … Continue reading Determinative Factors: “Debt” v. “Equity” and Your Loan to a Foreign Corporation (Part II)
My earlier blog post detailed some of the US tax consequences that could occur when a taxpayer makes, what he thinks is a “loan” to a foreign corporation, but that the Internal Revenue Service (IRS) later determines should be treated as an “equity” interest in the corporation. As set out in my earlier blog post, Treasury … Continue reading Determinative Factors: “Debt” v. “Equity” and Your Loan to a Foreign Corporation (Part I)
While the focus of today's post is how the United Arab Emirates (UAE) forthcoming Corporate Tax (CT) may impact US persons who are shareholders in a so-called Controlled Foreign Corporation (CFC) or Passive Foreign Investment Company (PFIC), the analysis applies equally to other jurisdictions which impose tax on the corporate entity. We examine today the … Continue reading Foreign Corporate Tax – How Will it Impact the US Taxpayer of a CFC or PFIC?
My earlier post set out certain details about the responsibility for a trust to file the Report of Foreign Financial Accounts (Form 114), or FBAR, with respect to foreign accounts it owns or is deemed to own under the FBAR rules. Today’s discussion covers the situation when trustees, trust beneficiaries and grantors (i.e., the trust … Continue reading Looking for Mr. FBAR: FBAR Filings for Trustees, Beneficiaries & Trust Grantors