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Foreign Accounts & Assets

California Residents Who Inherit Overseas Financial Accounts Must Comply With International Tax Laws

Changes to the Internal Revenue Service’s Offshore Voluntary Disclosure Program (OVDP) have made headlines in recent months. Although the program currently penalizes taxpayers who willfully fail to timely report their overseas banking income at a rate of 27.5 percent of the highest account balance during the preceding eight years, that penalty will rise to 50 percent for taxpayers who bank with a foreign facilitator that is under investigation by the IRS beginning on... Read More

Now is the Time for California Residents With Foreign Assets to Take Advantage of the IRS’s OVDP

Most nations do not require their citizens to pay income taxes on money earned in another country. The United States, however, is different. Americans who fail to pay the applicable taxes on assets stored in an offshore bank account can face serious financial penalties. Currently, the Internal Revenue Service’s Offshore Voluntary Disclosure Program (OVDP) levies a 27.5 percent penalty for willful noncompliance with the nation’s tax laws. As part of recent changes to the OVDP, U.S. citizens who... 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

FATCA Implementation May Affect San Diego Taxpayers With Overseas Financial Assets

Under current United States tax law, citizens and permanent residents are compelled to pay income taxes on their earnings regardless of where the individual lives or works. Many taxpayers who live or store money overseas are unaware of their duty to pay taxes on income earned in a foreign nation. Others reportedly seek to evade paying their required share of income taxes. Either way, a U.S. citizen or permanent resident who fails to comply with federal income tax laws can face stringent penalties.

 

On July... Read More