Do you have a non-U.S. bank account?
by Jeff Dunlop
There are many reasons why you might have a non-U.S. bank account. Maybe you spend a significant amount of time in a foreign country and want a local bank account or perhaps you support family members in a foreign country and as a matter of convenience have an account in your family members’ country of citizenship. Regardless of the reasons for your use of non-U.S. bank accounts, every U.S. person has reporting obligations regarding their foreign accounts and the income generated on these accounts. If you have failed to report the income from or existence of a non-U.S. bank account, you could be subject to substantial civil monetary and criminal penalties.
To induce compliance from taxpayers who have inadvertently failed to report the income from or existence of non-U.S. bank accounts, the IRS recently instituted a program where owners of unreported non-U.S. bank accounts can make a voluntary disclosure to become compliant with the IRS requirements, avoid substantial civil penalties, and generally eliminate the risk of criminal prosecution by the IRS. Making a voluntary disclosure also provides the opportunity to calculate, with a reasonable degree of certainty, the total cost of resolving all non-U.S. tax issues.
If a person does not voluntarily disclose non-U.S. bank accounts under the IRS program, he or she could be liable for civil and criminal penalties, which are significantly higher than the voluntary penalties.
The voluntary disclosure program for unreported offshore bank accounts may not be for everyone and the last date to participate is September 23, 2009. For more information regarding this IRS program you can visit:
http://www.irs.gov/newsroom/article/0,,id=206012,00.html?portlet=7.
To comply with certain U.S. Treasury regulations, we inform you that, unless expressly stated otherwise, any U.S. Federal tax advice contained in this communication, including attachments, is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service.
Tags: Jeff Dunlop, Tax Law