Those who investments in foreign markets are subject to esoteric federal disclosure rules that are enforced by the IRS. Not only must they disclose these assets, but they must also pay taxes on them. Investors must tell the federal government about any assets they hold in foreign markets, foreign bank accounts, or equity in foreign corporations.
In addition, those holding assets in U.S. markets must do the same. The process for reporting these assets and the rules governing exemptions can be quite confusing. Federal regulations governing tax obligations can be subject to change each time a new tax bill is passed.
This is why the majority of those who seek to hold assets in overseas accounts hire the aid of a Los Angeles CA international tax attorney whose job it is to stay current with both U.S. and foreign tax compliance regulations.
Randall & Associates has helped many of our clients manage audits, identify opportunities, and avoid costly non-compliance penalties. If you need an attorney to help you navigate a tricky situation, offer options regarding your legal obligations, or come up with a tax plan to get you in compliance with U.S. tax laws, our firm can help.
We Can Help You Avoid Costly Mistakes
Our clients are those who have investments in foreign markets, offshore bank accounts, shares in foreign corporations, shares in foreign mutual funds, or otherwise hold foreign assets on which they may or may not realize they are required to pay taxes on.
The IRS demands full disclosure when it comes to foreign assets, gains on interest, and bank accounts. While it is tempting to try to “hide” money from the IRS using foreign holdings, it is not wise or legal in most cases to do so. Whether you are a natural born citizen, a legal resident, or a corporation, you are required to pay taxes on whatever gains you make from foreign investment.
Failure to comply with federal regulations can result in IRS audits, fines, and penalties. When the IRS suspects that an individual has intentionally tried to mislead the government by underreporting their income, they can be ruthless. Massive fines and even jail time are not off the table.
What Must I Report to the IRS?
Los Angeles residents are required to report the following:
- Offshore bank accounts,
- Most foreign assets,
- And income and earnings from foreign sources.
What Tax Forms Does the Law Require Me to Fill Out?
Those with foreign holdings will need to fill out the FATCA Form 8939 and the FBAR (Foreign Bank and Accounting Report).
Additionally, the IRS may require you to disclose:
- Earnings from a foreign trust,
- Earnings from foreign mutual funds,
- And equity shares in foreign corporations.
In recent years, the IRS has become increasingly aggressive prosecuting international investors who try to hide assets and earnings in foreign markets. It is also increasingly common to target those who earn over a million dollars a year. If you are underreporting income in foreign investments, now is the time to report the accounting irregularity to the IRS.
A Los Angeles CA international tax attorney can help you regain compliance with federal regulations. Costly penalties could hurt your bottom line, expose you to unnecessary scrutiny, and even result in criminal prosecution.
Practical Solutions for Los Angeles Multinational Investors
The majority of those who find that they are not in compliance with federal regulations are not those who have intentionally tried to violate the law. Tax laws are complex, prone to change, and this is especially true when foreign assets are involved. Even those who have done nothing wrong may fear IRS scrutiny into their finances.
The attorneys at Randall & Associates have helped our clients navigate otherwise uncomfortable situations or restored tax compliance to those who might be targeted for prosecution.
The Offshore Voluntary Disclosure Program
The OVDP (Offshore Voluntary Disclosure Program) is an IRS program that allows individuals who have failed to report foreign investments to the IRS. It is essentially a grace period for getting into compliance with federal tax law. This program will end on September 28 of this year.
This amnesty extends to individuals who may be prosecuted under federal law. Act now, because the program will end soon. For a limited time, a Los Angeles CA international tax attorney could save you from criminal charges.
Randall & Associates could also provide you with other options. The federal government offers a streamlined offshore disclosure program. You may also be able to raise a reasonable cause defense to your tax burdens.
It’s Important Not to Ignore the Requirements of the IRS
The IRS has extended a grace period to those who are not in compliance with federal tax laws. If you act now, you can save yourself from fines and penalties, as well as prosecution. If you ignore this opportunity the IRS may aggressively pursue charges.
Contact the Los Angeles CA international tax attorneys at Randall & Associates today. We can help you weigh your options.