Tag Archives: OVDP

Offshore Tax Evasion: IRS Tax Audit

January 08, 2015  |   Posted by :   |   Tax Evasion   |   0 Comments

For those US taxpayers committing offshore tax evasion i.e. not reporting foreign income, not disclosing offshore accounts, they face a myriad of IRS tax audit issues: Civil and Criminal Penalties, and a myriad of Statute of Limitations. The IRS Civil and Criminal Penalty Issues include the following: Civil Penalty Issues 1. Civil Tax Fraud (75% […]

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IRS Hikes Offshore Account Penalty To 50% For Bank Leumi, Sovereign, 10 Others

January 06, 2015  |   Posted by :   |   OVDP   |   0 Comments

By Robert W. Wood, Forbes.com The IRS has updated its list of so-called bad foreign banks where offshore accounts trigger a 50% (rather than 27.5%) penalty in the Offshore Voluntary Disclosure Program (OVDP). The IRS added Sovereign Management and Legal, Ltd., plus certain branches of Bank Leumi. Neither addition should come as a surprise. Both […]

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Court Upholds Record FBAR Penalties, Exceeding Offshore Account Balance

June 20, 2014  |   Posted by :   |   FATCA/FBAR,Tax Evasion,Unreported Income   |   0 Comments

In the case of Carl Zwerner a $1.69 million undisclosed offshore Swiss Bank account (ABN/AMRO) cost the Florida taxpayer $3.48 million for FBAR (and other) violations (i.e. two times the account value). The jury found Zwerner willful and imposed the FBAR 50% penalty. The Zwerner case confirms: 1. The IRS/OVDP risks (the taxpayer applied, was […]

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Credit Suisse and the IRS

May 21, 2014  |   Posted by :   |   Tax Evasion,Unreported Income,Voluntary Disclosure   |   1 Comment

After more than 100 years of creating “secret offshore accounts” held covertly in the names of “sham entities and foundations”, on 5/19/14, Switzerland’s 2d biggest bank, Credit Suisse (“CS”) plead guilty to tax evasion (one count of conspiracy to commit tax evasion). CS agreed to pay $2.6B in federal and New York state penalties, and hire […]

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IRS Voluntary Disclosure 2013: An Update

October 05, 2013  |   Posted by :   |   Tax Evasion,Unreported Income,Voluntary Disclosure   |   0 Comments

Two recent cases demonstrate the great risk attendant to the IRS offshore Voluntary Disclosure Program (2012-forward) (“OVDP”). In the Bank Leumi case, dozens of U.S. taxpayers with accounts at Bank Leumi were in 2013 peremptorily disqualified from the IRS OVDP without explanation. The IRS has recently reversed this position and according to tax counsels have […]

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Voluntary Disclosure – Yes or No?

May 15, 2013  |   Posted by :   |   Tax Evasion,Voluntary Disclosure   |   0 Comments

by Sanford Passman, Esq. and Gary S. Wolfe The Internal Revenue Service (“IRS”) Offshore Voluntary Disclosure Program (2012) is offered by the IRS to American taxpayers who may be in violation of U.S. tax laws for a myriad of reasons. Given the enormous sums of money which are spirited to offshore tax havens throughout the world, […]

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IRS Offshore Voluntary Disclosure Program – OVDP

April 26, 2013  |   Posted by :   |   Voluntary Disclosure   |   0 Comments

In January, 2012 the IRS began their third Offshore Voluntary Disclosure Program (OVDP); the two prior initiatives (2009 OVDP, which ran from 3/23/09 through 10/15/09, and 2011 OVDI which ran from 2/8/11 through 9/9/11). The OVDP was established to encourage taxpayers to disclose previously undisclosed foreign offshore accounts, and undisclosed income from offshore accounts. U.S. […]

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IRS OVDP – Tax Compliance 2012

April 26, 2013  |   Posted by :   |   Tax Evasion,Voluntary Disclosure   |   0 Comments

The IRS/OVDI program requires: 1. Filing complete and accurate Form 1040(x) amended federal income tax returns for all tax returns covered by the voluntary disclosure, with applicable schedules detailing the type and amount of previously unreported income from the account or entity (Schedule B for interest and dividends, Schedule D for capital gains and losses, […]

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IRS OVDP – Statute of Limitations

April 25, 2013  |   Posted by :   |   Voluntary Disclosure   |   0 Comments

Under the normal rules, a three year statute of limitations applies for the IRS to assess tax penalty and interest. The three year statute of limitations may be extended: 1. To six years, if the IRS can prove a substantial omission of gross income; 2. If there was a failure to file information returns; e.g., […]

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IRS OVDP – Title 26 Penalty of 27.5%

April 25, 2013  |   Posted by :   |   Unreported Income,Voluntary Disclosure   |   0 Comments

The Title 26 Penalty of 27.5% of the highest aggregate balance in foreign bank accounts/foreign assets includes unreported foreign bank accounts/assets held by individuals or businesses. This “offshore penalty” is intended to apply to all of the taxpayer’s offshore holdings that are related in any way to tax non-compliance, regardless of the form of the […]

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