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Posted in on September 19, 2017
How a Boston Tax Attorney Can Help You With OVDP Streamlined Submissions
If you have money in offshore bank accounts or you have signature authority over offshore accounts, you're required to report those accounts to U.S. tax authorities. In addition to declaring accounts to the IRS, you also must comply with a requirement to file a Report of Foreign Bank and Financial Account (FBAR) with the Financial Crimes Enforcement Network (FinCEN) if the aggregate balance of your combined offshore accounts hits $10,000 at any point during the year. Many offshore account holders don't realize they have all these obligations, and thus, inadvertently fail to comply with them.
Non-compliance can be a big problem, unfortunately, that could result in criminal penalties or large civil fines that, in some cases, have exceeded the value of the account balances. Those who wish to avoid criminal prosecution and reduce these substantial penalties should contact a Boston tax attorney at Thorn Law Group as soon as possible. Kevin E. Thorn, Managing Partner of Thorn Law Group, and his legal team can explain the Offshore Voluntary Disclosure Program (OVDP) and advise on whether you can make a Streamlined Submission through this program to limit possible penalties.
Understanding OVDP Streamlined Submissions and Boston Offshore Voluntary Disclosure
The Offshore Voluntary Disclosure Program (OVDP) is essentially an amnesty program for people who, out of their own accord, report previously undeclared offshore accounts. If you are not under investigation already, you can admit that you previously failed to follow the rules for declaring foreign accounts and, in exchange for willingly coming forward, the consequences you face are less severe than they would be if the IRS discovered your compliance failures on its own.
Many taxpayers who wish to participate in the OVDP may be eligible for Streamlined Submissions. The OVDP Streamlined Submission Process is an option if you are a non-willful violator. A non-willful violator is a taxpayer that didn't intentionally fail to report offshore accounts for the purposes of subverting tax obligations to the IRS. If this applies to you, you'll have to attest that you simply were negligent in complying with account disclosure rules or that you didn't understand the rules and that's why you failed to comply with them in the past.
If you are eligible to participate in Streamlined Filing, you will need to submit amended returns and FBARs for all the years you were supposed to report your accounts but didn't. You are going to have to pay back taxes for the years when you failed to report your offshore accounts as well as interest on any unpaid tax balances. You'll also have to pay a penalty equal to five percent of the balances in the undeclared offshore accounts. Our Boston offshore voluntary disclosure firm will review your individual situation and determine if Streamlined Filing is an option for you.
Speak With a Boston Tax Attorney Today to See if You Are Eligible for OVDP Streamlined Filing
Although the financial penalties for OVDP Streamlined Submissions can add up to a substantial amount of money, it’s far less than you would pay if you were considered a willful violator or if the IRS discovered your offshore account on its own – which is extremely likely to happen because many banks and insurance companies are now participating in an amnesty program that is aimed at encouraging financial institutions to give up accountholder information in exchange for avoiding criminal prosecution.
There are risks to attempting a streamlined submission, including the chance the IRS will decide your violation wasn't a non-willful one. However, speaking with a Boston tax attorney before taking action on your own can ensure you make the right choice about OVDP Streamlined Submissions. To see if you are eligible for Streamlined Filing, contact Thorn Law Group today to consult with Managing Partner Kevin E. Thorn.