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foreign trusts

Update: Sole Owner / Beneficiaries of Foreign Trusts Can Face Higher Penalties, Court Says

A trust can be a useful wealth management tool to reduce tax obligations, and ensure beneficiaries receive their intended assets. However, when that trust is held overseas, the IRS requires extra tax returns from both owners and beneficiaries to make… Read More
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Appeals Judges Disagree O…

Appeals Judges Disagree Over Maximum Willful FBAR Penalty

The question of just how expensive a willful penalty for failing to report foreign financial accounts has been making its way through the federal court systems. Now, the Second Circuit has issued a split opinion that shows just how divided judges are… Read More
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Is the FAST Act’s Passport Certification Constitutional?

Can the government restrict your ability to travel overseas if you don’t pay your taxes? Is the 2015 FAST Act’s passport certification process constitutional? One doctor challenged the law, but he may have filed his lawsuit a bit too soon. 20 Yea… Read More
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Categories: Tax / IRS Penalties
Lawsuit

Plaintiff Tries to Dismiss His Own FBAR Lawsuit and Fails

Why would you file a lawsuit against the IRS just to turn around and ask the District Court to dismiss it? A combination of impatience, new precedent, and personality changes left a Plaintiff looking for a way out of the Federal Court of Claims. Inte… Read More
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Emergency fund

Inherited Secret Emergency Account Caused Willful FBAR Violations, Appeals Court Says

Is there ever a good reason to hide something from the IRS? A recent opinion from the U.S. Federal Circuit Court of Appeals suggests that even the best of reasons won’t matter if a taxpayer is later found to have willfully failed to file FBAR forms… Read More
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searching for files in a filing cabinet

One Form, One Non-Willful FBAR Penalty, Circuit Court Says

How many penalties can the IRS assess for a single missed form? That was the question before the Ninth Circuit Court recently in United States v Boyd. At least where an accurate FBAR report was filed late, the Court ruled that the one form and one vi… Read More
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woman reviewing tax documents

Can the IRS Impose FBAR Penalties if You Don’t Owe Taxes?

Many retired U.S. taxpayers don’t owe taxes at the end of the year. If their income from pre-tax retirement accounts and Social Security is offset by medical expenses or other allowable deductions, they may not have enough income to report, or any… Read More
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legal documents

IRS Says Due Process Only Requires Written Response, Not a Hearing

What opportunity should you have to dispute an IRS penalty before it is assessed? Should you be able to take the government to court? What about an administrative hearing by the IRS Appeals Office? In a recent motion to dismiss a taxpayer’s complai… Read More
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Foreign Money

Court Finds Drug CEO’s FBAR Violations Willful, Even if Unintentional

Can the IRS assess penalties for willful FBAR violations if the taxpayer didn’t mean to lie to the government or hide assets? In a second opinion, one federal judge in Pennsylvania has ruled that a drug company’s CEO owed more than $1 million in… Read More
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trust

IRS Ignores Reasonable Cause Statements in Assessing Foreign Trust Account Reporting Penalties, Website Says

Recent changes to the IRS website acknowledged an existing policy to assess penalties for failure to file Form 3520 regarding foreign trust assets without considering taxpayer-provided reasonable cause statements. The website warns that taxpayers wil… Read More
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