Articles Posted in Offshore Accounts

If you maintain or have maintained an offshore bank account without disclosure on your federal tax return and have also failed to properly file the Report of Foreign Bank and Financial Accounts, also known as the FBAR, you may face significant civil and criminal sanctions. The failure to file an FBAR can carry a civil penalty of $10,000 for each non-willful violation. If your violation is found to be willful, the penalty could be the greater of $100,000 or fifty percent of the amount in the account for each violation. A taxpayer convicted of tax evasion can face a prison term of up to five years and a fine of up to $250,000.

Fortunately, for those taxpayers whose noncompliance was non-willful, the Streamlined Offshore Compliance Procedures (“Streamlined Procedures”) offer substantially reduced penalties and the avoidance of criminal prosecution. On June 18, 2014, the Internal Revenue Service announced Streamlined Procedures. There are two sets of Streamlined Procedures, one for U.S. taxpayers residing in the United States, and the other for U.S. taxpayers residing outside the United States.

Streamlined Procedures For Taxpayers Residing In The United States