A Los Angeles businessman has pleaded guilty to conspiracy to defraud the United States government. According to the U.S. Justice Department, the American citizen owned a number of Israeli bank accounts that he failed to report to the Internal Revenue Service. The L.A. man apparently held the accounts in the names of nominee corporate entities in an effort to avoid detection by the agency. In addition, he purportedly asked the Israeli financial institution where the accounts were opened to hold his mail. Instead, the man collected his account statements directly from an international... Read More
A certified fraud examiner and forensic accountant has reportedly pleaded guilty to willfully hiding almost $1 million from the Internal Revenue Service in a Swiss bank account. In USA v. Bloomberg, a 55-year-old Atlanta man was accused of failing to report his ownership and control interest in a foreign bank account between 1997 and 2008. According to the United States Justice Department, the Georgia man failed to report an account that was held at UBS AG, one of the largest banks in Switzerland. The man now faces up to five years in prison and a civil fine of one-quarter of a... Read More
Earlier this month, a judge delayed sentencing for a member of a prominent New York family who pleaded guilty to tax evasion in 2010. In the case, the woman’s father apparently left her and her siblings millions of dollars that were stored in a secret offshore account. Rather than report the Swiss bank account to authorities, however, the siblings allegedly developed and implemented a tax-evasion scheme using the advice of a financial adviser. Although the woman was the first member of the family scheduled to be sentenced in the conspiracy, the federal judge determined that her sentencing... Read More
Earlier this month, an 83-year-old Florida man pleaded guilty to hiding up to $1.1 million in undeclared Swiss bank accounts. He also admitted to submitting false federal tax returns and engaging in a conspiracy that lasted for approximately 25 years. According to United States authorities, the man went so far as to move his undisclosed foreign financial accounts to an Israeli bank after learning that the U.S. government was cracking down on Swiss banking institutions for their alleged role in assisting American taxpayers with concealing overseas assets.
In May 2014, Credit... Read More
California Man Sentenced to Prison Time, Incurs Hefty Financial Penalties for Using Foreign Bank Accounts to Commit Tax Fraud
A California medical device inventor was recently sentenced to six months in prison followed by six months of house arrest after he was convicted of using offshore bank accounts to hide assets from the United States government. In United States v. Desai, a San Jose man apparently used numerous overseas bank accounts to conceal nearly $8 million in assets between 2007 and 2009. Although the man reportedly earned at least $1.2 million in interest from the offshore bank accounts over the course of three years, he only paid a total of $17,000 in federal income taxes.
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Criminal Tax Case Reminds Californians They Cannot Use Offshore Accounts to Avoid Federal Income Taxes
In United States v. Kerr, two individuals and their former attorney were charged with various counts of conspiracy to defraud the United States government by establishing foreign bank accounts used to hide money overseas, willfully filing false federal income tax returns by omitting the income placed in their foreign accounts, and failing to file a... Read More
One of the greatest advantage of participating in the Offshore Voluntary Disclosure Process is the immunity it provides from a variety of civil penalties. If a taxpayer has undisclosed financial assets or accounts which are discovered by the IRS, numerous penalties may apply, potentially creating a huge financial burden on the taxpayer. Participating in OVDP can massive reduce the financial impact of failing to disclose foreign financial accounts and assets. If a taxpayer who is eligible to participate in OVD fails to do so, the following penalties may apply.
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California Online Gambling Case Highlights Significant Penalties Charged to Taxpayers Who Fail to File a Timely FBAR
On June 30th each year, the Report of Foreign Bank and Financial Accounts (FBAR) must be filed by United States Taxpayers who have an ownership or signatory authority over certain foreign financial assets totaling at least $10,000. A taxpayer’s failure to timely file the FBAR may result in steep penalties of $10,000 or up to one-half of the highest balance of the asset. The IRS has stated the FBAR must be filed for a variety of overseas assets... Read More
In the United States, taxpayers who hold one or more financial accounts with more than $10,000 in aggregate assets overseas or who have signature authority over such an account are required to complete a Report of Foreign Bank and Financial Accounts (FBAR). The FBAR is filed to alert the Internal Revenue Service to an individual taxpayer’s relationship with certain offshore financial or securities accounts. All U.S. taxpayers with an ownership... Read More
Recent Federal Case Demonstrates Importance of Filing Timely FBAR for Taxpayers in Southern California and Elsewhere
A recent case out of Florida demonstrates the importance of properly complying with Report of Foreign Bank and Financial Accounts (FBAR) requirements. In United States v. Zwerner, the government filed a lawsuit seeking to recover approximately $3.5 million in civil penalties from an elderly man accused of failing to timely report his overseas assets. Although the man voluntarily disclosed his foreign financial interests on his 2007 tax return and filed an amended tax return and FBAR for the previous three years, no formal voluntary disclosure procedure such as the Offshore... Read More
Recently, the IRS announced additional streamlined procedures and changes to its Offshore Voluntary Disclosure Program, in order to make it easier for taxpayers to satisfy their obligations regarding reporting offshore accounts. These changes do not result in an entirely new OVDP program; rather, they are a continuation of the previous OVDP programs introduced in 2009, 2011 (OVDI), and 2012. The IRS announcement contains expanded streamlined provisions for OVDP as well as changes to the existing 2012 OVDP program already in place.
Purpose of the Offshore... Read More
Basics of the FBAR Filing Requirements
U.S. taxpayers who have interest in foreign financial assets or accounts may have reporting obligations of which they are not even aware. In recent years, the IRS and the Department of Justice have been aggressively pursuing U.S. taxpayers who fail to comply with certain U.S. international tax rules.
FBAR, or “Foreign Bank Account Report,” is an informational filing that must be made to the IRS by “U.S. persons” if the person has an interest in, or signatory authority over a foreign financial account... Read More